Team defines stream

According to most of those who have been through it, the process of value stream mapping, or VSM, keeps the makers of Post-Its in business. They recall papering the meeting room with hand-drawn string diagrams bristling with yellow stickers shouting 'Why?' 'Waste?' 'Who'? 'How long?' and 'Find out'. Some describe it as switching on a light, others as the most draining, exhausting and painful exercise of their careers. Virtually every factory with lean regimes that actually work started here, with VSM. Like painting a wall, if you want the colour to stick, it's better to clean and prepare the surface first rather than slapping gloss over the dirt. Benchmark Research's 2005 analysis of lean adoption in UK manufacturing could not turn up a single critical voice from those who had been through the VSM process. So you'd think everyone would be using it? Not so. The same research showed that some 12% of companies embarking on lean changearounds are missing out the VSM stage entirely. Good luck to them - they are going to need it. It is therefore worth recapping the principles of VSM. Its fundamental role is to help pinpoint and eliminate wasteful activities. By assigning cross-functional teams to analyse and document their current information and material flows, it allows them to build a detailed 'map' of the ideal future state of operations. At product level, companies usually derive a series of maps, one for each product family, that chart the value stream from inception to final manufacture and from the first customer contact to delivery and after-market care. At shopfloor level, it helps build a detailed picture of an operation where components and materials can be 'pulled' without interruption or waste through the manufacturing process at a rate that meets customer demand. But it applies equally to non-manufacturing processes such as demand planning along the supply chain or even skills development and training to meet future market plans. It is an invaluable tool that allows companies to understand their shortcomings and set a route for overcoming them. According to Stuart Mitton, lead practitioner with MAS North West at The Manufacturing Institute, process mapping and VSM are commonly confused. "Process mapping is a more detailed step-by-step walk through a particular operation. VSM is a bit like physically lifting the roof off your factory and hovering to look down on it. It gives you a very high-level view of the main activities from door to door." He says one of the major failings of change management is people making local improvements that still don't have a big effect on the value stream because they haven't identified the real issues or tackled the underlying bottlenecks or constraints. "To me, VSM is the strategic improvement plan for the business. Working with a cross functional team, it gives us a good understanding of the major issues in our manufacturing operations and our information flow." Looking at factory floor operations in isolation without considering upstream activities, notably sales, is not viewing VSM in its proper context. Big picture Nonetheless, some companies have made good progress by focusing on strictly limited areas of activity flagged up by the 'big picture' of VSM analysis. Take Brecknell Willis of Chard in Somerset, which specialises in electrification/traction for transportation systems. Working with South West MAS, it mapped a major product family and identified opportunities for reducing lead times through improving two key areas: its machine shop and assembly area. Two sub teams were set up, receiving extensive training in lean concepts and techniques to support them in mapping detailed process changes, and agreeing and implementing the action plan. It led to revised changeover procedures, new measurement systems and visual methods of communicating key objectives and targets, altered working practices to run machines through breaks, changes in workplace organisation and the installation of kanbans for controlling work in progress (WIP). As a result, the company was able to cut set-up times by 60% in the machine shop and reduce assembly workstations from 18 to 5, contributing to a 40% space gain. The new layout has helped continuous flow and, with the addition of kanbans, production is now 'pulled' across the assembly area. Teamwork has improved and there has been an overall 25% efficiency gain. The company is now planning to build on the initial training by developing its managers and team leaders. Production manager Richard Whitefield thinks MAS's workshops made a real contribution: "They have enabled the operators to realise their ability to improve their workplace and be proud of it, which improves morale and also affects efficiencies." Although the process has not yet been carried out across the board, the effects are already rubbing off on other areas. Mitten, however, takes a wider view: "A common understanding of what we are trying to do from the outset is critical. I always try to set an expectation that we need strong decision making capability from as many of the business functions as we can engage in the process." VSM should start with sales, which has a critical input to the effectiveness of manufacturing. "The demand pattern needs to be clear. Companies lucky enough to have a forecast have a good start. But many clients, particularly SMEs, have no forward visibility whatsoever and it's a big problem. So we have to really think about the rate of consumption by the end customer." Mitten has some key rules of thumb for making the VSM process pay dividends (see box p17). The list is comprehensive and makes the whole exercise sound like a mighty mountain to climb with a lot of outside help. T'ain't necessarily so. In fact, one of Mitten's clients, Knowsley-based plastic colorant firm ColorMatrix, needed his direct involvement for no more than 12 days in a year-long lean project which is on track to double productivity, improve output and reduce lead times. His work focused on instilling the principles that helped ColorMatrix to improve its own operations and take control of its own destiny. Mitten's initial engagement was simply to give an overview of lean (45 minutes) and to run a lean Lego game that simulated the move from push to pull (2 hours) to 95% of the operators and managers. "Everyone therefore had an initial awareness of work and waste, value added and none value added." Overlaid with a comprehensive 5S programme across the factory, it provided the basis for the current and future state map. Highlight issues The current state map startled client and practitioner alike: it showed only 2% of the leadtime actually adding value. And this was in a business performing well. Everyone recognised that the traditional push environment was leaving a huge amount of inventory sitting around between steps. It highlighted allied issues: if anyone needed to check progress, they had to physically find the job on the shopfloor - no easy task with such high levels of WIP. Laboratory quality checks - vital where much of the product heads for the food industry - were also causing hold-ups. Ideally, they should be carried out while the product was still being manufactured. But with things taking too long to process, operators were missing their slot in the schedule so batches had to be taken offline and parked. Brainstorming between the multi-disciplinary lean team highlighted 114 real opportunities from the current state - far too many to be handled on the first pass. So the team matched them against a set of five key objectives: a manufacturing leadtime of seven hours; 95%-plus schedule adherence; WIP reduction of 50%; two-hour release time for QC; 50% improvement in first-time passes. "If they didn't meet these key objectives and make a significant impact, they were left for a while," explains Mitten. In effect, the team was being asked to look at the whole value stream and vote for the common good rather than for their specific function. In general, this sometimes leads to problems and often involves sacrifices. For example, if you are buying raw material at a cheaper bulk price, it's tough to pay more for amounts that fit smaller, more frequent batches. Mitten stresses this is yet another reason why any company tackling VSM needs the buy-in of every member of the group. Each project that passed muster was allocated to a team member to develop the future state map and the action plan to achieve it. Taken together, they added up to a potential 60% productivity improvement. It sounds staggering but ColorMatrix is already well on the way to achieving it. Logistics manager Jane Hall says that by eliminating the identified inefficiencies, the company will be able to support a trebling of its business growth. There have been major changes. Forecasting has improved significantly. Orders are placed directly on the factory by sales staff, who have full on-screen visibility of the schedule. The Manufacturing Institute is continuing workshops to align sales and production, but trust is growing between the two as the benefits of lead time reduction and flexibility become apparent. Factory layout has changed: kanbans are in place for runners and repeaters and the bulk of the raw materials. Procurement staff have worked with suppliers to handle replenishment of kanbans. Mitten ascribes much of the success to the way Hall and manufacturing manager Jim Charlton have driven the whole thing with passionate commitment and a strong focus: "When something hit a brick wall, they unblocked it." Mitten points out a salient difference between ColorMatrix's real achievements and the end result of many VSM exercises: "While you may have documented your current state and designed your future state, unless you actually make changes, you have just added more cost. Unless you implement what you have talked about, nothing will be achieved, and you will disillusion your employees with one more management fad." He believes it must become almost the overriding aim of going to work. "It's easy to become sidetracked by other issues but this is all about winning the time to do things right."