Operational Excellence
OPEX Team has always been a fan of Keanu Reeves in the Matrix with the ability to see through the digital world. In production and business we can also do that with Value Stream Mapping.
We told that because Value Stream Mapping is really a very powerful tool, especially for senior leaders and business owners. Value Stream Mapping is used to understand and redesign the entire business operation chain, including production, services, software, health … to increase value content and eliminate waste.
What is Value Stream Mapping?
Value Stream Mapping, or Value Flow Mapping, is a Lean method – streamlined management to analyze the current state and design the future state for a sequence of processes, stages from the moment customers place orders. goods, by the time the customer receives the product or service. Value Stream Mapping represents both information and material flows through the company’s processes.
First, Value is what the customer accepts to pay for us to provide them. This value is created after a series of activities, processes, stages – Value Stream. Mapping is a process of redrawing the current state of the value stream, designing the future how it will improve, and when that future becomes a reality, we continue to optimize and design the value flow. of the future.
Value Stream Mapping Including Parts?
Value Stream Mapping always includes 2 diagrams: Present and Future – who are we if we are not superheroes when drawing the future and making it a reality?
Value Stream Map (VSM) – Value flow diagram
Steps to Draw Value Stream Mapping?
Step 1: Determine the type of product / service you will choose to draw.
Step 2: Determine what your drawing goals are, or what are you trying to solve? From both the customers’ perspective and the internal views of the company. When different needs will lead to focus on the parts or indicators important to solve that problem.
Step 3: Establish a team to draw the Current Value Flow Diagram: the expert’s advice is that this team should include key members related to each part of the value chain. This team will go together and draw all the stages together.
Step 4: Identify opportunities for improvement that are implemented.
Step 5: Redraw the flow chart of the future.
For example, on the OPEX appliance company Flow Chart above, we see the biggest opportunity lies in having too much inventory in the material stock, 32 tons is equivalent to 32 days. This may be due to the supplier in another country or province. The problem may also occur when the supplier has a minimum order quantity that is too large for OPEX’s current production scale.
Suppose we find an opportunity to improve our inventory of raw materials down to 7 days, then we can release a working capital equivalent to 25 days equal to 54.7% of the total dead capital in inventory.
From another perspective, Lead Time or Response Time with orders is also shortened by 54.7% and capital also rotates twice faster! This is Lean’s greatest benefit – Lean Manufacturing. You can read more about Lead Time here.
How does using VSM help your business?
– Get the picture of overall operation of the entire enterprise, understand each detail that affects production and business activities that are sometimes overlooked when just making a common system diagram.
– Through the Value Flow Map, you can immediately recognize and always the stages that actually bring value but have not been focused on or the stages that are wasted that we have not realized. Based on those detailed data, we can plan to invest more in activities that create value for our businesses, eliminate unnecessary waste, create close links between stage together.
– Plan for improvement clearly, prioritizing which improvements are based on data rather than just making decisions based on your feelings.
With more than 15 years of experience in working with more than 50 factories, OPEX Team are confident that, when you have this Value Stream Mapping, you discover a treasure map for your own business.
Let’s get started drawing the Value Flow Map for your business! You can find other LEAN articles on https://Opexvn.com/ to accumulate knowledge before applying or contact OPEX to receive specific advice for the problem you are having.
OPEX Consulting – Operational Excellence Your Business
