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Value Stream Mapping

“Wherever there is a product for a customer, there is also a value stream.
The challenge lies in seeing it.”

Mike Rother, John Shook – Learning to See

Introduction

Value Stream Mapping (VSM) is a method for visualising manufacturing processes—specifically, their entire value stream — so they can be analysed and optimised. All activities, both value-adding and non-value-adding, that are necessary for the manufacture of a product are recorded. Together with the flow of materials and information, as well as process and warehouse data, this creates a holistic picture of production.

As the first phase of value-stream management, VSM captures the current state, uncovers non-value-adding processes and exposes waste. Value Stream Design then sketches a future state that shortens waiting times and eliminates unnecessary work, aiming for a flow with short lead time and a high share of value creation. Finally, Value Stream Planning organises and executes the transition from the current to the future state.

In their standard work Learning to See: Value-Stream Mapping to Add Value and Eliminate Muda (Amazon link), Mike Rother and John Shook describe two streams: the manufacturing stream, which carries raw material to the finished product, and the development stream, which takes the product concept to production start-up. Both can be examined with VSM, but the focus here is on the manufacturing stream—“dock to dock.” During the analysis this stream is traced backwards from customer demand to raw material.

Method and Procedure

1. “Segmenting production”: selecting a product or product family

Before mapping begins, the right “altitude” must be chosen. Examining every product family across the whole enterprise is neither practical nor useful. A good starting point is to pick one product or family with prioritisation methods. An ABC/XYZ analysis works well for a single product; for grouping products into a family, use their final production steps. A SIPOC diagram then sets clear start and stop events—typically order receipt as the start and shipment as the stop—so the analysis has precise boundaries.

2. Determining the customer takt

Next, calculate the customer takt for the chosen product or family from average demand and available production time.

Example assumptions:

Annual demand: 12 000 units
Production capacity: 48 weeks (5 days/week, two 8-hour shifts → 28 800 s per shift)

Calculation:

Output per shift = daily demand (= 12 000 / 50 / 5 = 48 units) / 2 shifts = 24 units/shift
Customer takt = 28 800 s / 24 units = 1 200 s per unit (20 min)

The process therefore must produce one unit every 1 200 seconds to meet average demand; slower output fails to satisfy the customer.

3. Visualising the process diagram: sample value-stream map

The first step is to visualize the entire value stream. Observation takes place from the goods issue or from the customer back to the raw material.

3.1 Capturing material and information flow

Distinguish push from pull flows.
Include incoming-goods checks and quality inspections.
Document information flows—how orders arrive, are released to production and transmitted (type, frequency, approvals).

3.2 Defining process-data boxes and times

Record all process-relevant data (cycle time, change-over time, scrap rate, yield, machine availability, etc.); Define lead times and the shares of value-adding vs. non-value-adding time; Derive indicators for assessing process efficiency.

3.3 Validating the current state

All participants review the map to confirm every interface as well as material and information flows.

4. Identifying potentials and defining the future state

Once the map has been completed and validated, it serves to reveal waste wherever it occurs—often made obvious by the visualisation itself. Together with the process owners, a new future process is defined in the Value Stream Design phase so the customer takt can be met more effectively.