Value Streams

Fundamentals of Manufacturing
Excellence Program
 Outline
• What are Value Streams?
• History - Toyota
• Identifying the Value Streams
• Value Stream Mapping
• The Current State
• The Future State
• Unique Situations
• Enhancing the Future State
• Implementing Change
• Roadblocks
 What Are Value Streams?

A Value Stream is the set of all actions (both

value added and non value added) required
to bring a specific product or service from
raw material through to the customer.
 Types of Value Streams

•“Whenever there is a product (or service) for a customer,

• there is a value stream. The challenge lies in seeing it.”

• 3 enterprise value streams:

• Raw Materials to Customer - Manufacturing
• Concept to Launch - Engineering
• Order to Cash - Administrative Functions
 History of Value Streams - Toyota
• Toyota is one of the most efficient manufacturers in the
world
• Building 2 million cars a year outside Japan
• Aiming to become No 1 globally by 2010!
• Not because of brilliant products – but because of a
brilliant production system
• Called Lean Production or Lean Thinking
 History of Value Streams - Toyota
• Toyota has probably the most efficient supply base in
the world
• 300 1st tier suppliers - 2-3 per part
• Co-located and tightly synchronized by 2-4 hourly milk
rounds from Toyota
• Conducting joint process analysis together for 30 years
• As a result each supplier delivers each part 99.9995%
right first time on time!
 History of Value Streams - Toyota
• Toyota has been building cars to order in Japan for 30
years
• Based on a continuing relationship with many of its
customers through door-to-door selling!
• Which it also uses to smooth orders on production
• Yes – buffered by long lead-time export orders
 History of Value Streams - Toyota

• Toyota probably has one of the most efficient distribution

systems – for service parts
• Dealers pre-diagnose and pre-order parts they need –
they do not stock them!
• Local Distribution Centers deliver 2-3 times a day
• Regional Distribution Centers deliver daily
• Most of their parts suppliers can make and ship all the
parts required in a day by the next day
• The system copes with 400,000 part numbers and is
being rolled out across the globe
 History of Value Streams - Toyota

• Toyota’s success is based on a different business logic: -

– Organized to manage the whole value stream for
each product family – rather than to manage and
optimize each asset and firm in isolation
– Pulling the right products through the system quickly
as required by the customer – rather than making to
forecast and selling from stock to strangers
– Based on operational capability and joint process
analysis - rather than relying on supplier auctions and
big centralized information systems
 Identifying the Value Stream

• The starting point is to learn to distinguish value creation

from waste in your whole value stream
• By putting on waste glasses!
• By choosing a product family
• By assembling the team and taking a walk together up
the value stream
• And drawing a map of what you find!
 Identifying the Value Stream

process level

Start Here single plant

(door to door)

multiple plants

across companies
 Value Stream Improvement vs. Process
Improvement

Value Stream
Process Process Process
Customer
Assembly
Stamping Welding
Cell

Raw Finished
Material Product
 Value Stream Mapping

• Helps you visualize more than the single process level

• Links the material and information flows
• Provides a common language
• Provides a blueprint for implementation
• More useful than quantitative tools
• Ties together lean concepts and techniques
 Value Stream Mapping

• Follow a “product” or “service” from beginning to end,

and draw a visual representation of every process in
the material & information flow.
• Then, draw (using icons) a “future state” map of how
value should flow.
Value Stream Mapping
 Value Stream Mapping

• Directly observing flows of information and physical

goods for a product family as they now occur

• Summarizing these flows visually

• Envisioning future states that leave out wasted steps

while introducing smooth flow and leveled pull
 Features to Include
• Total steps versus value creating steps
• Total time versus value creating time
• Noise (demand amplification) in order flow
• Quality/capability (defect damping) of each facility
• Availability of each facility
• Hand-offs, work-arrounds and total logistics costs
Note: This is not a product costing exercise! Follow one
component path all the way back to raw material
 LEAN MANUFACTURING

1  Origins

Production  1.5 Production Bases

Bases

 Aim at satisfying the demand by single-unit production.

Economic The transformations of the production flow resulting from the
Bases
postulate eliminate the need to model the demand and simplify
programming to a substantial degree.
Social
Bases
 Simplify all the operations and eliminate transport, storage and
handling.
Technical
Bases
 Mechanise everything that does belong to a "mental" contribution
TOYOTA by the operators.
PRODUCTION
SYSTEM
 LEAN MANUFACTURING

2  General Principles

 2.1 Fields of Application : WORK ORGANISATION

WORK
ORGANISATION
E.P.  The industrial flow is split between:
operations actions carried out on the material
by machines and operators

Process operations

INTER OPERATION Storage-Controls-Delays-Transport/Handling

O OP O …..
OP
 LEAN MANUFACTURING

2  General Principles

 2.2 Field of Application : WORK ORGANISATION

WORK
ORGANISATION
Optimisation
E.P. The "Lean Manufacturing" programme is centred on
Optimising Operations in the Process

WORK
ORGANISATION
E.P.
 Eliminating waste, delays, handling, controls,
 Reviewing line architecture (flow, installations )
 Reviewing supply chain
 LEAN MANUFACTURING

2  General Principles

 2.3 Field of Application: WORK PROGRAMMING

WORK Obtain the resources
PROGRAMMING  Aim at reducing the production cycle and enable
- Production
- Optimisation Prod. Piecework
Batches Production
 Adapt capacity to the customer's instantaneous demand
WORK Results in resolving the "conflict"
ORGANISATION
Optimisation Saturation Optimisation
E.P. resources of direct
costs
depreciation
inflated
towards zero
WORK
ORGANISATION
Results in founding a social agreement
E.P.

Fixe Mobile
 LEAN MANUFACTURING

2  General Principles Field of Application

MANAGEMENT  2.4 Management Rules they come from the "triangle"

RULES

Reduction in conflicts
of interest
WORK Management / Operators
PROGRAMMING
- Production
- Optimisation

WORK
ORGANISATION
Optimisation
E.P. Respecting the "Equality" of treatment
factory floor staff of operators/structure

WORK Working Social conditions

ORGANISATION conditions
E.P. (making more variable)
 Flexibility

APOD 01 ref SPS

PE005F ind.AB
 Balance : to delete waiting time
Takt time= net worked time / total Manufacturing need ( customer need)
1 60
Break down in basic operation 2 60
Delete all wastes b/w operations
sec sec

Takt time Takt time

Operation
Operation
time
time
30
sec Work 30 Wastes can
data sec be deleted

0 1 2 3 4 5 6 7 8 9 10 0 1 2 3 4 5 6 7 8 9 10

Operators Operators

3 60
Redefine new operation 4 60
Balance basic operation and operator HC
sec. sec. Takt time
Takt time
Operation
Operation
time
time
30 30
sec Staying data sec Balanced
data

0 1 2 3 4 5 6 7 8 9 10
1 2 3 4 5 6 7 8 9 1
0
Operators 0 Operators
Re-stabilize : if variation of customer need
Takt time= net worked time/ total Manufacturing need ( customer need)
a1 if customer need increase operation have been re-stabilised
a2 60 Qty operators increase
60 Takt time decrease.. sec.
sec.
Previous de
Takt time
Operation Operation
time time
Temps de Takt
new de Takt 30
30
time sec.
sec Balanced
operation

0 0
1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9
Operators 10 Operators 10

If customer need decrease , .. Operations have been re-stabilized and

b160 Takt time increase b260 qty of operators decrease Takt
sec. new Takt time sec. time

Operation Previous Operation

time Takt time time
30 30
sec sec Restabilised
operation

0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9
Operators 10 Operators 10
 Balance: Work frequency for operator
Definition : movements rollup and operations made by each operator to make his
operation in defined takt time

Optimised work is done when work charge of every operators is similar and equal to takt time to
delete all waiting time in front of benches
Work balance
part flow
Elasticity
U shaped line allow improving in flow process
single part
 U concept process line
linear In U

Parallel
A 1

B 2
A 16 F 34
B E
C 3 2 5
B 25 E A F
1 6
D 4
C 34 D
E 5
F 6
 U shaped line: different kind of process
To optimise balance of line and respect of takt time , line must re layout to close all process need;
the automatism element must be moved away to operators.

automatic process bench

Process line with manual assembly

including automatic machine

Standard U process
for manual assembly
Loading
mean

Loading mean
Flower process allow to few operators to load many
automatic processes :
- Best balance work charge
- best quality
Conveyer
- team work and mutual aids
- ….