Value Stream Mapping in Office and Service

Get Lean - Value Stream

Mapping for Office and Service

Karen Martin President

The Karen Martin Group, Inc.

Kim Scott iGrafx Senior Consultant,

Lean Six Sigma Black Belt

What will you learn?

Value Stream Mapping helps you

understand and improve your Office

and Service processes.

Digitalizing VSMs is easy and makes sharing a snap.

Introducing Karen Martin

• Founder: The Karen Martin Group, Inc. (1993)

• Consultant / Coach: Lead Lean transformations

& develop people in office, service and

knowledge environments.

• Teacher: University of California, San Diego’s

Lean Enterprise program.

• Author:

Winner - 2013

Shingo Research Prize

Introducing Karen Martin

www.ksmartin.com/subscribe

Value Stream Mapping’s Roots

5

Mike Rother & John Shook, 1999 Beau Keyte & Drew Locher, 2004

Whenever there is a product for a customer,

there is a value stream.

The challenge lies in seeing it.

— Mike Rother & John Shook, Learning to See

Value Stream Defined

Value Stream: All of the activities, required to fulfill acustomer request from order to delivery (and beyond tocash received).

Customer

6

Value Stream

Process ProcessProcess

Customer

Request

Customer

Receipt

The Work We Do:Degrees of Granularity

7

Value Stream

Process Process Process

Step Step Step

Value Stream Map

Micro View Tactical; heavy

frontline involvement

Macro View Strategic;

heavy leadership involvement

Metrics-Based Process Map

Office/Service Value Stream Examples: By Industry

• Repair/maintenance – Customer request to revenue received

• Financial services – Mortgage application

• Law – Litigation value stream

• Healthcare – Patient care; revenue cycle

• Technology – Software development

• Government – Permitting

• Construction – Large equipment installation

• Law enforcement – Arrest processing

• Engineering/architecture – Design development

• Oil & Gas – Fossil fuel exploration & production

8

Support (Value-enabling) Value Streams

• Estimating / RFQ response

• Hiring – Recruitment to 1st (or 90th) day

• New product development

• Business plan development

• Annual sales meeting planning & execution

• Contract development & execution

• And more…

9

Value Stream Mapping Benefit:Seeing the Whole

10

60,000 foot view; Rooftop view

VSM Promotes Systems Thinking

11

Individual Efficiency =

Sub-optimization

System Efficiency =

Optimal Value Stream

Performance

Truth

Truth

Truth

Truth

Truth

Truth

Truth

Truth

Truth

CLARITY

12

What’s our customer

really experiencing?

How are we

really performing?

13

Value Stream Mapping:

As Much Art as Science

Create a Value Stream “Storyboard” with Paper & Post-Its (Team-Based)

14

Customer

Process 5

Dept E

LT = 1 daysPT = 15 mins.

%C&A = 95%

4

5

10 mins.

480 mins.

5 mins.

240 mins.

3 mins.

2 days

5 mins.

240 mins.

15 mins.

480 mins. Total LT = 5 days

Total PT = 38 mins.

Activity Ratio = 1.6%

Rolled %C&A = 69.1%

Process 3

Dept C


%C&A = 99%

3

3

Process 4

Dept D

LT = 0.5 days

PT = 5 mins.%C&A = 99%

2

4

ABC Technology, Inc.

Current State Value Stream MapSoftw are Upgrade Order Fulfillment

Customer Demand = 500/year

IT-1 IT-2

45 pcs 10 pcs

Process 2

Dept B

LT = 0.5 daysPT = 5 mins.

%C&A = 75%

2

2

`

Process 1

Dept A


%C&A = 99%

5

1

Basic Value Stream Map

Information

Flow

Material &

Data Flow

Timeline

16

Interim

Briefing(s)

1 Contact Information

2 1

3 2

4 3

5 4

5

1 6

2 7

3 8

4 9

5 10

1 Contact Information

2 1

3 2

4 3

5 4

1

2

3

4 Date: Date:

Signature:

Date:

Potential Obstacles ApprovalsExecutive Sponsor…to the team's success with the mapping activity.

Implementation Plan

Current state VSM Function

Future state VSM SMEs that may not be needed full time

Always a nice touch; keeps

the team from wandering.

Need ample wall space

Planned Deliverables On-Call Support

Aim for objectives w/ measurable targets (from X to X).

Goals & Measureable Objectives

Why are you doing this? What are the current state issues? Function

Leadership-heavy

Event Drivers Mapping Team

List required attendees; others

are optional

Briefing

Attendees

Boundaries &

Limitations

FS Implementation

Timeframe

What is the team NOT authorized to change?

Typically 90-120 days

Last Step Task on last process block

Value Stream Mapping CharterEvent Scope Leadership / Coordination Schedule

Start/End

Times

VP or C-level

If needed - often Director or

Manager level

Specific

Conditions

What circumstances you're including and

excluding? (type of cust, time of year, etc.)

Value Stream

Champion

Contract processing, rebate processing, etc.Executive

SponsorValue Stream Event Date(s)

Team Lead Not always needed

Skilled person leading the activity

Meals

Provided?

Location

Coordinator

The person arranging logistics

(reserving the room, ordering food,

sending meeting notices, etc.)

Facilitator

First Step Task on first process block

Customer Demand

Trigger

How many times is this done per wk, qtr, mo, or yr.?

What need does the value stream address?

Signature: Signature:

3 days typically; sequential is

best

6 hrs minimum; 7 or 8 is best

FacilitatorValue Stream Champion

Aid in consensus building and

organizational learning.

Name

Name

Value Stream Mapping Process

Define

Product Family

Design

Future State

Document

Current State

Execute!

3 Day

Event

Create

Transformation Plan

The Office Version of Product Families

Order

Fulfillment

Process

International

Domestic

Service Parts

Consumables

Units

Non-Warranty

Warranty

Service Parts

Consumables

Units

Non-Warranty

Warranty


Define

Product Family

Design

Future State

Document

Current State

Execute!

3 Day

Event

Create

Transformation Plan

Step 1 – Define Process Blocks

• Identify all process blocks in the value stream

(target 5-15 blocks)

– Each process block (post-it) contains an activity or

group of activities that occurs before a significant

break in the timeline occurs (typically build up of WIP

or handoff to another function)

– Activity format is verb/noun – what happens to what

– WALK THE VALUE STREAM!

20

Customer

Process 5

Dept E


%C&A = 95%

4

5

10 mins.

480 mins.

5 mins.

240 mins.

3 mins.

2 days

5 mins.

240 mins.

15 mins.


Total PT = 38 mins.


Rolled %C&A = 69.1%

Process 3

Dept C


%C&A = 99%

3

3

Process 4

Dept D

LT = 0.5 days

PT = 5 mins.%C&A = 99%

2

4




IT-1 IT-2

45 pcs 10 pcs

Process 2

Dept B


%C&A = 75%

2

2

`

Process 1

Dept A


%C&A = 99%

5

1

Value Stream Mapping Components

Step 2 – Define I.T. Systems

• Identify all I.T. systems used in the process and information flow

– Note any scheduling that occurs (calendar,

system, etc.)

– Who tells whom to do what? How do they tell

them?

22

Customer

Process 5

Dept E


%C&A = 95%

4

5

10 mins.

480 mins.

5 mins.

240 mins.

3 mins.

2 days

5 mins.

240 mins.

15 mins.


Total PT = 38 mins.


Rolled %C&A = 69.1%

Process 3

Dept C


%C&A = 99%

3

3

Process 4

Dept D

LT = 0.5 days

PT = 5 mins.%C&A = 99%

2

4




IT-1 IT-2

45 pcs 10 pcs

Process 2

Dept B


%C&A = 75%

2

2

`

Process 1

Dept A


%C&A = 99%

5

1


Step 3 – Add Data

• Key metrics for all process blocks– Process Time (PT)

– Lead Time (LT)

– Percent Complete & Accurate (%C&A)

• Work-in-process (WIP) at every step.

• Significant barriers to flow (e.g. batching, shared resources, system downtime, etc.)

24

Post-it Conventions

# Staff (if

relevant)

Significant

Barriers to Flow

Process

(Verb/Noun)

Function

%C&A

Process Time

Lead Time

Block #


Customer

Process 5

Dept E


%C&A = 95%

4

5

10 mins.

480 mins.

5 mins.

240 mins.

3 mins.

2 days

5 mins.

240 mins.

15 mins.


Total PT = 38 mins.


Rolled %C&A = 69.1%

Process 3

Dept C


%C&A = 99%

3

3

Process 4

Dept D

LT = 0.5 days

PT = 5 mins.%C&A = 99%

2

4




IT-1 IT-2

45 pcs 10 pcs

Process 2

Dept B


%C&A = 75%

2

2

`

Process 1

Dept A


%C&A = 99%

5

1

Key Metrics: TimeScenario 1

27

Lead Time (LT)

Work

ReceivedWork passed to

next step

Process Time (PT)

LT = PT + Waiting / Delays

Key Metrics: TimeScenario 2

28

Work

Received

Work passed to

next step

Process Time

LT = PT + Waiting / Delays

Lead Time (LT)

Key Metrics: Quality

• %Complete and Accurate (%C&A)

– % of incoming work that’s “usable as is”: the

downstream customer can perform task

without having to do rework:

• Correct information or material that was supplied

• Add information that should have been supplied

• Clarify information that should have or could have

been clearer

– Determined by the person receiving the input;

metric goes on the output block.

29

Customer

Process 5

Dept E


%C&A = 95%

4

5

10 mins.

480 mins.

5 mins.

240 mins.

3 mins.

2 days

5 mins.

240 mins.

15 mins.


Total PT = 38 mins.


Rolled %C&A = 69.1%

Process 3

Dept C


%C&A = 99%

3

3

Process 4

Dept D

LT = 0.5 days

PT = 5 mins.%C&A = 99%

2

4




IT-1 IT-2

45 pcs 10 pcs

Process 2

Dept B


%C&A = 75%

2

2

`

Process 1

Dept A


%C&A = 99%

5

1


Step 4 – Create Timeline

• Create timeline

• Calculate summary metrics

– Timeline PT Sum

– Timeline LT Sum

– Activity Ratio (AR)

– Rolled %C&A

31

Summary Metrics: Time

• Activity Ratio

– The percentage of time anything is being done

to the work passing through the system (whether

value-adding or non-value-adding)

– (∑PT ÷ ∑LT) × 100

– Common current state finding in office/service =

1-10% (across entire value stream)

32

Summary Metrics: Quality

• Rolled % C&A

– The percent of value stream output that passes

through the process “clean,” with no “hiccups,”

no rework required.

– (%C&A x %C&A x %C&A…) x 100

– Common current state finding in office/service

= 0-15%

33


Customer

Process 5

Dept E


%C&A = 95%

4

5

10 mins.

480 mins.

5 mins.

240 mins.

3 mins.

2 days

5 mins.

240 mins.

15 mins.


Total PT = 38 mins.


Rolled %C&A = 69.1%

Process 3

Dept C


%C&A = 99%

3

3

Process 4

Dept D

LT = 0.5 days

PT = 5 mins.%C&A = 99%

2

4




IT-1 IT-2

45 pcs 10 pcs

Process 2

Dept B


%C&A = 75%

2

2

`

Process 1

Dept A


%C&A = 99%

5

1

Current State Value Stream Map

Outpatient Imaging ServicesDemand = 15 per day

Customer Demand:

15 patients per Day

(Takt Time 1920 seconds)

8 hours per day

Referring

Physician

% C&A = 65 %

Check-in

Patient

(Admitting)

Cycle Time = 2 mins.

% C&A = 90 %

5

Send

Reports

(Imaging)


% C&A = 90 %

6

Hospital

5 mins.

Schedule

Appointment


Lead Time = 12 mins.

% C&A = 98 %

6

Pre-register

Patient



% C&A = 100 %

5

CT=Cycle Time

LT=Lead Time

%C&A=% Complete & Accurate

Lead Time = 12 mins.Lead Time = 990 mins.

Prep

Patient

(Tech)


% C&A = 100 %

2

Check-in

Patient

(Imaging)


% C&A = 98 %

3

Complete

Exam

(Tech)


% C&A = 90 %

2

Transmit

Images

(Tech)


% C&A = 100 %

2

Read/Dictate

Exam

(Radiologist)


% C&A = 95 %

2

Transcribe

Report

(MDI)


% C&A = 75 %

6

Review

Draft/Sign

(Radiologist)


% C&A = 95 %

2

Print

Reports

(Imaging)


% C&A = 99 %

230 mins. 5 mins. 248 mins. 365 mins. 960 mins. 110 mins. 120 mins.45 mins.

E Pay

Excel

ADS

Symposium

Internet

Waiting Room

Management

System

Fax Order

Solutions

PACS

5 mins.

Lead Time = 24 days

Meditech

123

4

5 6 7 8 9 10 11 12 13 14

Auto Fax 50%

Us Mail 25%

MD Mailbox 25%

Rework Loop via Fax 25% of

the time

Rolled First Pass

yield = 29%

5 minutes

2 minutes 11520

minutes

1 minutes

45 minutes

10 minutes

30 minutes

15 minutes

5 minutes

3 minutes

248 minutes

15 minutes

365 minutes

5 minutes

960 minutes

1 minutes

110 minutes

1 minutes

120 minutes

3 minutes

L/T = 13464 minutes

VA/T = 11576 minutes

Outpatient Imaging Value StreamCurrent State Findings

36

MetricCurrent

StateProjected

Future State%

Improvement

Lead Time 32.5 hrs

Process Time 56 mins

Activity Ratio 2.9%

Rolled %C&A 29%

Step 5 – Determine VA & N Steps

• Identify all value-adding (VA) and necessary non-value-adding (N) steps

– Add “VA” or “N” smaller post-it to relevant

process blocks

– All unnecessary non-value-adding blocks

remain unlabelled

37

Customer-Defined Value

• Value-Adding (VA) - any operation or activity your external customers value, are (or would be) willing to pay for, or it’s a requirement of doing business with them.

• Non-Value-Adding (NVA) - any operation or activity that consumes time and/or resources but does not add value to the product (good or service) the customer receives.– Necessary – support processes, regulatory

requirements, etc.; also referred to as “essential” or “value-enabling.”

– Unnecessary – everything else - WASTE

38

Eight Wastes (Muda)

• Overproduction

• Inventory

• Waiting

• Over-Processing

• Errors

• Motion (people)

• Transportation (material/data)

• Underutilized

people

39

Typical Current State Findings

Islands of activity (process times) within long lead times.

40

Value Add

Necessary NVA

Order Delivery

Unnecessary

NVA

Work is idle


Define

Product Family

Design

Future State

Document

Current State

Execute!

3 Day

Event

Create

Transformation Plan

Future State Design

• Goal: Eliminate all redundancies and barriers to flow (the work should never stop)– Batches

– Rework

– Bottlenecks & WIP

– Handoffs

– Setup / changeover

– Physical layout

– Motion & transportation

42

Future State Value Stream Map Outpatient

Imaging ServicesDemand = 15 per day

Referring

Physician

% C&A = 85 %

Send

Reports

(Imaging)


% C&A = 90 %

6

Hospital

Schedule appt

Pre-register



% C&A = 98 %

6

CT=Cycle Time

LT=Lead Time

%C&A=% Complete & Accurate

0.0833 hrs.

1 mins.

0.583 hrs.

10 mins.

0.333 hrs.

10 mins.

0.0833 hrs.

2 mins.

2 hrs.

15 mins.

7 hrs.

1 mins.

0.0333 hrs.

1 mins.

0.5 hrs.

3 mins.

LT = 11.3 hrs.

CT = 43 mins.

CT/LT Ratio = 6.32%

Lead Time = 45 mins.Lead Time = 15 days

Prep

Patient

(Tech)


% C&A = 100 %

2

Check-in

Patient

(Imaging)


% C&A = 98 %

3

Complete

Exam

(Tech)


% C&A = 90 %

2

Transmit

Images

(Tech)


% C&A = 100 %

2

Read/Dictate

Exam

(Radiologist)


% C&A = 95 %

2

Review

Draft/Sign

(Radiologist)


% C&A = 95 %

2

Print

Reports

(Imaging)


% C&A = 99 %

220 mins. 5 mins. 120 mins. 420 mins. 2 mins. 30 mins.35 mins.

E Pay

Excel

Symposium

Internet

Waiting Room

Management

System

Fax Order

Solutions

PACS

5 mins.

Set-upReduction

Remove Check in

and ReduceSystem Access

Work Balancing

StandardWork

Pull System(Supplies Kanban)

VisualWorkplace

Voice Recognition

Batch Reductions

5S

Co-locate

StandardWork

Work Balance

ContinuousFlow

Value StreamAlignment

Auto Fax 80%

Us Mail 15%

MD Mailbox 5%

Rolled First Pass

yield = 40%

Rework Loop via Fax 10% of the time

Customer Demand:

15 patients per Day

(Takt Time 1920 seconds)

8 hours per day

12

3

45 6 7 8 9 10 11

Risk Reduction

(Joint Commision)

Meditech

Note: Process Time (PT) is referred to as

Cycle Time (CT) on this map

Outpatient Imaging Value StreamProjected Future State Results

44

MetricCurrent

StateProjected

Future State%

Improvement

Lead Time 32.5 hrs 11.3 hrs 65%

Process Time 56 mins 43 mins 23%

Activity Ratio 2.9% 6.3% 117%

Rolled %C&A 29% 40% 38%


Define

Product Family

Design

Future State

Document

Current State

Execute!

3 Day

Event

Create

Transformation Plan

Value Stream

1 2 3 4 5 6 7 8 9 10 11 12

2 Improve quality of referral KE Sean O'Ryan

3, 4Reduce lead time beween schedulingand

preregistration stepsPROJ

Dianne

Prichard

5, 6Eliminate the need for two patient check-

insKE

Michael

O'Shea

6 Eliminate bottleneck in waiting area KEDianne

Prichard

9Eliminate lead time associated with

transcription stepPROJ Sam Parks

10 Eliminate batched reading KE Sam Parks

7Reduce inventory costs, regulatory risk

and storage needsKE

Michael

O'Shea

12 Reduce delay in report delivery PROJ Martha Allen

12 Reduce delay in report delivery KE Martha Allen

Implement voice recognition technology

Reduce setup required

Cross-train and colocate work teams

Implement additional fax ports

Collect copays in Imaging

Balance work / level demand

5S CT supplies area; implement kanban

Value Stream Mapping Facilitator

Increase percentage of physicians

receiving electronic delivery (rather than

hard copy)

Approvals

Executive Sponsor Value Stream Champion

Signature:

Date: Date: Date:

Signature: Signature:

Block

#Goal / Objective Improvement Activity

Implement standard work for referral

process

Type OwnerImplementation Schedule (weeks) Date

Complete

Date Created

11/21/2007

Allen Ward

Sally McKinsey

Dave Parks 12/13/2007

10/18/2007 1/10/2008

Future State Implementation Plan

Executive Sponsor

Value Stream Champion

Value Stream Mapping Facilitator

Implementation Plan Review Dates

11/1/2007

Outpatient Imaging


Define

Product Family

Design

Future State

Document

Current State

Execute!

3 Day

Event

Create

Transformation Plan

RE

PE

AT

Common Differences - Manufacturing vs. Office VSMs

Manufacturing Office

Customer icon Upper right Center

Supplier icon Upper left None

“The thing” we’re followingRaw material, sub-assemblies,

finished goodsPaper, verbal, and electronic

Information

Information FlowMore structured / formalized I.T.

systemsMultiple I.T. systems and

work-arounds

Schedule notification Multiple points across VSM Work not scheduled

Material flow (via hollow arrow)

Yes Sometimes

WIP icon Inventory triangle In-bin (if preferred)

LT determination for each block

Based on the time to process all of the accumulated WIP between

process blocks

Based on a single item passing through the value stream

Hands-on time to do the work

Cycle Time Process Time

Quality Metric First Pass Yield (FPY)Percent Complete & Accurate

(%C&A)

Takt Time Typically can be appliedApplicable in areas with dedicated

resources

How can we help?

Karen Martin, President

7770 Regents Road #635

San Diego, CA 92122

858.677.6799

[email protected]

Twitter: @karenmartinopex

Blog & newsletter: www.ksmartin.com/subscribe

• www.igrafx.com/lean

• Custom Demonstration

• Process Program Assessments

www.igrafx.com/contact

503-404-6050

How can we help?

Thanks!