Value Stream Mapping: The Lean Tool That Drives Real Business Change

Value Stream Mapping: The Lean Tool That Drives Real Business Change

1. Introduction to Value Stream Mapping (VSM)

Lean is a business improvement methodology focused on maximising customer value by eliminating waste and improving flow. It originated from the Toyota Production System and has since been adopted across many industries. There are a variety of tools within this methodology to help achieve this goal. One of them is Value Stream Mapping.

Value Stream Mapping (VSM) is a key Lean tool used to create a visual overview of the organisation, enabling analysis, collaboration, adjustment, and ensuring more productivity from the conception of a product or service until the handover to the client.

The industries where VSM is commonly applied are varied, yet each benefits from this Lean tool. Here are some of the industries and why they would use VSM:

• Manufacturing: would use VSM to improve production flow and reduce waste within a project’s lifecycle.
  
• Healthcare: would use VSM to streamline patient flow and reduce wait times, enhancing the patient journey.
  
• IT & Software: use VSM to optimise DevOps pipelines.
  
• Financial Services: use VSM to improve loan processing or claims handling to ensure efficiency and accuracy.
• Customer Service & Shared Services: use VSM to enhance service delivery and response times.
  

There are various reasons these organisations use VSM. Some of these reasons help with identifying the areas that detract value, and others in areas that could be improved to assist with increasing the value-add. 

Here are some reasons that VSM would be used: 

• Launching a Lean or continuous improvement initiative, VSM helps with:
  
  • Gaining a holistic view of the end-to-end process.
    
  • Engaging cross-functional teams in identifying inefficiencies throughout the project.
    
  • It can serve as a baseline for improvement tracking for both the current and future projects.
    
• Identifying bottlenecks or waste in a process, VSM is used to:
  
  • Pinpoint excessive wait times and overproduction.
    
  • Visualise rework loops and unnecessary handoffs.
    
  • Highlight constraints in people, process, or technology.
    
• VSM is used as a part of operational transformation projects by:
  
  • Aligning process changes with business strategy.
    
  • Supporting digital or automation initiatives.
    
  • Facilitating structured change management.
    
• To align cross-functional teams around improvement priorities, you could use VSM to:
  
  • Build shared understanding of process realities.
    
  • Enhance communication between departments.
    
  • Encourage joint ownership of improvement goals.
    

2. What is a Value Stream Map?

Understanding what a value stream is will help you find the relevance in VSM. A value stream is a set of activities that take a product or service (whether it is product or service-based) from request to delivery. This includes all activities, whether they are value-adding or non-value-adding. 

Therefore, a value stream map is a tool used to visualize the flow of materials and information throughout the various activities. This visual would include process steps, inventory levels, data metrics, and communication lines. 

For example, Jarred began to look at a VSM for his product. There were some key questions he had to ask himself. These questions will help him map out every phase, boosting the efficiency. Some of these questions are: 

• What are all the steps needed to create the product / deliver the service?
• Are these steps all adding value for the customer?
• Are the steps only adding value to the business? Are the steps actually pure waste?
• How many people are involved at each step?
• How is information shared?
• What is the cycle time for this step? Can some steps go faster than others?
• What things happen in series and what happens in parallel?
• How many times does the process get interrupted?
• Are there any delays? Does the process ever stop?
• Can we see any queues forming behind any particular steps?
• What is the timeline for each task to be started and completed by?
• What issues or challenges are linked to this task/phase?
• Do errors occur? Does rework get carried out?

When working with VSM, there are two main types of maps: a Current State Map and a Future State Map.

A Current State Map shows in detail how the process is operating at any given time. It is an accurate snapshot of what is happening. This includes:

• An understanding of real-time flow and delays.
• Inefficiencies and redundancies are exposed.
• This provides the basis for improvement planning.
• To highlight where the overall bottlenecks and constraints lie

A Future State Map is now a visualisation of how the process could operate after improvements have been implemented. This helps:

• To show the impact of applying lean principles, i.e., kanban, reduced batch sizes, process rebalancing, etc.
• To quantify the macro benefits for the entire end-to-end process 
• To set new performance targets for the business to aim for
• To prioritise the initiatives that will really make an impact

Jarred has drawn up a Current State Map and notes that there is a large delay between ordering materials and their delivery. He can see that this was due to poor communication and bad scheduling. In his Future State map, he can implement procedures to prevent this communication breakdown and eliminate the time delays.

These Value Stream Maps use symbols and flow type diagrams to map the process from start to finish. This can help the leader or manager to see the flow of work, enhance efficiency, and identify areas that might cause delays.

This might sound similar to a process flowchart, however, these are two very different tools. A process flowchart focuses on the task steps, while the VSM focuses on the entire, end-to-end value chain. VSM also integrates timing, inventory, communication, process metrics, and identifies waste explicitly, while a process flowchart does not.

For more information about these differences, read our article, Value Stream vs Process Mapping: Which will Deliver Better Business Outcomes.

3. Purpose & Benefits of VSM

Now that you understand what VSM is all about, what could the purpose of one be in your business? Why would you want to look at using this tool?

There are a variety of elements to the purpose of a value stream map, these are:

• Visualising the  end-to-end processes, which include:
  
  • Capturing the complete picture, not isolated tasks.
    
  • Promoting transparency of handoffs and systems used.
    A lot of time can be wasted double-handling information and translating the same information from one person to the next.
    
  • Helping non-technical stakeholders understand the workflow to align their expectations with the reality of the work.
    
• Identifying non-value-adding steps, or waste, by:
  
  • Highlighting excess motion, waiting time, errors, mistakes, double handling, and overproduction (amongst others).
    
  • Differentiating between value-added and non-value-added time.
    
  • Enabling prioritisation of improvement actions and additional efficacy.
    
• Understanding process flow and delays with a view to:
  
  • Showing bottlenecks and imbalances throughout the end-to-end process.
    
  • Analysing push vs. pull systems and their effect on the overall process.
    
  • Illustrating lead time vs. cycle time.
    
• Establishing a common understanding among teams and stakeholders with:
  • Siloed departments are being united under shared goals and visions.
    
  • A visual tool for cross-functional discussion and goal tracking. (How do we all work better to deliver for our customers?) 
  • Supportive change initiatives with data-backed evidence for real-time decisions and improvements.
    
• Creating a baseline for future improvement by:
  
  • Serving as a measurement reference point for future development.
    
  • Tracking progress over time over multiple projects.
    
  • Providing data for ROI evaluation.
    

How would these elements support your business? Here are some benefits of using this method:

• You can identify activities that waste time and negatively impact performance. This could be any activity that does not add value. Once you know of these activities, you can eliminate them (either immediately for the current order or in the future). VSM can also help you quantify the waste in detail - whether it is time, money, labour, etc.
• Reducing lead times will benefit your overall flow of the business. VSM can help you plan in such a manner that your lead times are optimal and your productivity is increased.
• This approach also ensures increased collaboration and cohesion between team members. This increases the team's vision and ability to integrate teams within each phase of work or between departments.
• VSM is a framework with the long-term in mind, there is always a view to use Lean tools to improve future work and continuously improve your approach with data-driven changes.

4. Value Stream Mapping in Lean & Six Sigma

While Lean’s primary goal is to reduce waste, it can be hard to visualise how this looks in reality. A value stream map is the way to create a tangible and visual image of the overall process.

VSM mapping does this by showing the macro, end-to-end view of how your product or service is delivered. What are the main steps, how long do things take, where do queues form, how is labour balanced, etc. It also helps to highlight what tasks are value-adding and what are not. More specifically, what types of waste exist in the process (transportation, inventory, motion, waiting, overproduction, overprocessing, defects, and skills underutilized). This awareness is the first step in streamlining the process and increasing efficiency.

When looking at the DMAIC (Define, Measure, Analyse, Improve, Control) in Six Sigma, you will be able to see that VSM integrates Lean’s drive towards simplicity and Six Sigma’s data-driven process.

Here is how VSM can integrate with DMAIC:

• Define: creates a map of the current state, providing an accurate view of current problem areas, and helps you define priority problems.
• Measure: VSM encourages users to quantify the lead time, waiting times, labour utilization, etc. This quantifies the amount of waste, or improvement potential.
• Analyse: A VSM is at its heart an analysis tool, so it naturally helps to analyse a process, identify bottlenecks, and look for practical ways to decrease waste.
• Improve: This information will allow for future state maps to be completed to build on better processes for future projects.
• Control: VSM isn’t normally directly applied to the Control phase of a DMAIC improvement project. You may want to check at the end of a project to see if the future state VSD was effectively implemented and adjust if necessary.

How does VSM help with Kaizen?

As Taiichi Ono once said, “the worst problem to have is not having any problems”. Paraphrasing him, we can also say that not seeing any opportunities for improvement is a serious problem.

Value Stream Mapping, when done well, will uncover an enormous list of opportunities for improvement and provide an incredible amount of fuel for your Kaizen (or Continuous Improvement) process. It is not uncommon for business leaders to ask their teams for ideas only to receive a lukewarm response… “we’re pretty good”, “there's not really much more we could be doing better,” etc. Value Stream Mapping will turn that point of view on its head. It is a tool that leaders can use to (in effect) “cure” their teams of blindness when it comes to waste. People are, in reality, surrounded by waste but unable to see that and as a result don't do much about it. 

VSM helps teams to see the flow in their processes and any interruptions to that flow. This awareness then kicks off their Kaizen process.

Furthermore, Kaizen encourages teams and individuals to make small quick improvements. When those small improvements are also aligned to the bottleneck (identified through your VSM) in your business, the effect on your business and the subsequent benefits are supercharged.  

5. VSM for Service-Based vs Manufacturing-Based Processes

There are key differences when looking at value stream mapping for manufacturing processes and value stream mapping for services. Understanding these differences will ensure that your VSM is tailored for your specific situation. 

When looking at Manufacturing VSM, you will see a focus on: 

• The physical product flow. Which tracks the movement of raw materials, WIP, and finished goods. This can also help highlight bottlenecks at machine steps and manual steps while identifying excessive inventory or underutilised capacity.
• Inventory levels at each process step, which is important to understand how the process is flowing. Will orders move quickly through the system or will it take days and weeks? Control of inventory is a key element of Kanban and JIT implementation.
• Equipment cycle times, set up times , downtime etc. These key metrics clarify how the process is performing and can be used to benchmark with other facilities
  

Whereas when you look at the service industry VSM, you can see there are different areas of focus, such as: 

• The flow of information (emails, approvals, data entry). This helps to map routes of digital documentation or customer data. It will help to show queue times in systems and manual reviews, and identify redundant approvals or outdated systems.
  
• The direct interactions with and wait times of the customers. This can be done by plotting touchpoints from inquiry to resolution, measuring the speed and quality of these interactions, and highlighting areas of customer dissatisfaction.
  
• Areas relating to internal touchpoints and delays in handoffs between departments. This ensures there is a tracking of responsibilities through different teams and departments.
• Visualise when rework happens. Perhaps this is due to unclear instructions and poor standardization of handovers.

For example, Steph used VSM for her healthcare project. This helps to map the patient’s journey from entering the building to discharge. The map allowed Steph to see the delays in areas such as triage, waiting for a bed, laboratory results, etc. This would enable her to find ways of improving the process with the minimization of waste.

Whereas Dudley works in finance and he uses VSM to help him track the process of his client’s journey from loan application to approval, ensuring the most efficient process that will enhance the client’s experience and minimise dissatisfaction. 

6. IT Value Stream Mapping

Looking closely at the IT sector, you can see that IT value stream mapping in both DevOps and digital transformation aims to create an end-to-end flow of information and data for a process. This is important, especially for a company that is siloed - VSM can provide one overarching map by creating a shared understanding of the product or service being created.

VSM helps to answer the question of how long it will take before the customer can use the software. Helping to solve the code-to-customer problem in an effective manner. This involves tracking the software delivery pipelines to ensure any discrepancies between tools and teams are identified.

VSM can also help IT customer service teams. Companies that map workflows from when an issue is raised by a customer, logged by customer service, verified by the Dev team, fixed and released by QA etc., can uncover lots of areas for improvement. Some typical improvements can relate to issue prioritisation, approval gates, Dev team resource allocation, Dev process updates etc.

When businesses and IT services interact, there may be misunderstandings due to the difference in goals and frames of reference. VSM can support this collaboration by offering a shared language (flow, value, waste, etc), visibility on how the business’s requests become tasks or are actioned, and an aligned view of what is slowing down processes. 

VSM is an important part of the IT industry for good project management.

7. Steps: How to Create a Value Stream Map

Creating a value stream map works by completing 7 specific steps. For an in-depth look at these steps, read our article, ‘How to Create a Value Stream Map: A Step-by-Step Guide for Lean Success’. 

This is a high-level breakdown of the value stream mapping procedure:

• Define the product/service family. 

This refers to identifying a product or service workflow that shares similar processing steps and customer value. It is recommended to map a product or service that is common or generates a lot of profit.

• Select the process owner and cross-functional team.

You need to assemble a team that includes stakeholders from all departments involved in the value stream, from start to finish. There will need to be a person leading the creation of the VSM and a team responsible for implementing the recommended actions.

• Map the current state.

This is where you create your Current State Map. You visually chart the flow of information, people, and tasks as they currently exist, including handoffs, delays, rework, and queues. Confirm what has been written on the map by doing a "Gemba Walk". Go to the actual process in person and confirm you've got the process right.

• Collect relevant metrics (cycle time, lead time, inventory).

Here you will collect a number of key data. How long each individual step takes - cycle times. How long it takes from request to delivery - lead time. What is being kept waiting (inventory, WIP, work orders, people)? Collecting this data is important to help you identify the areas that are non-value-adding.

• Identify wastes and bottlenecks.

From this point, you can analyze the current map to spot non-value-adding activities (the 8 wastes), long wait times, rework loops, and process interruptions. You should prioritise those with the biggest business impact, namely those that directly affect the bottleneck.

• Map the future state.

Now you can design the Future State Map. You design a streamlined version of the process that removes or reduces waste, improves flow, and shortens time-to-value.

• Develop an implementation plan.

The last step is to create a phased plan to move from the current to the future state, assigning responsibilities, timelines, success metrics, and feedback loops.

8. Common Symbols and Terminology

Understanding the common symbols and terminology of VSM will assist you in creating and reading value stream maps. Here are some key symbols and terms for you to understand:

• Process Box - Represents an activity, step, or task where value is added (e.g., development, testing, assembly).
• Inventory Triangle - Indicates a queue, backlog, or waiting material/work between processes.
• Information Flow Arrow - Shows communication or data passed between systems/people (e.g., Jira ticket, email, phone call).
• Timeline Bar - Tracks value-added vs non-value-added time beneath the process steps.
• Data Box - Sits under a process to show metrics like lead time, cycle time, uptime, and number of operators.
• Lead Time - Total time from request to delivery (includes wait time).
• Cycle Time - Time actively spent on a task (value-added).
• Takt Time - The maximum allowable time to produce one unit based on customer demand.
• Touch Time - Actual time someone works on a task.
• Wait Time - Time a task sits before being worked on.

9. Digital Tools & Software for VSM

Using tools and software, or a value stream map creator, to assist you in building your maps would be important to maintain a level of accuracy and efficacy.

Sometimes you will find free value stream mapping software, while you may have to pay for others or for more advanced features. To explore more detailed explanations of the free value stream mapping software, go to the article ‘Top Free Software for VSM: Improve Flow, Drive Change’.

Here is a list of basic software that you could look at engaging with:

• Lucidchart - This is a cloud-based diagramming tool known for its intuitive interface and collaborative features. Which is helpful for process mapping and VSM. It also allows integration with Google Workspace, Microsoft, and Slack.
• Miro - Is an online collaborative whiteboard platform used for brainstorming, Agile ceremonies, and mapping workflows. It is beneficial when doing cross-functional team mapping with interactive board templates.

• EDrawMax - Is a versatile diagramming tool offering thousands of templates for flowcharts, technical diagrams, and value streams.
• Microsoft Viso - Is an enterprise-grade diagramming solution from Microsoft, widely used in corporate environments. It has integration with Microsoft 365 and offers industry-standard templates. 

10. Best Practices from Learning to See

A core value stream mapping book is ‘Learning to See’, by Mike Rother and John Shook. This book’s aim was to bring the Lean principle of VSM from Japanese business practice to a global audience and engage them in learning to see value stream mapping.

Using a practical workbook format, Rother and Shook addressed their audience in a manner that enabled them to start thinking about systems rather than individual processes, to understand Lean principles, and develop their own practices for minimizing waste. 

Some of the key points of the book, such as current state maps, future state maps, takt time, understanding customer demand, and eliminating waste by seeing flow, help the reader to engage with this visual tool to redefine how they see a project (whether it is manufacturing or service-based).

Here are some application tips from the book - if these sound interesting, it is recommended that you read their full book.

• Start with a product or service family, not the whole business.
  
• Walk the process (“go to the gemba”) — don’t rely on assumptions or documents, have your own take.
  
• Map both material and information flow — delays often come from decision-making, not just physical work.
  
• Capture real numbers: lead times, WIP counts, wait times — not guesses, this is where data-driven approaches are key.
  
• Use future state design to ask:
  
• Where can we create flow?
  
• Where can we pull instead of push?
  
• Where is the pacemaker process (linked to takt time)?
• Update regularly — VSM is not a one-time exercise. It evolves as systems improve.

11. Real-World Examples of Value Stream Mapping

To gain a further understanding of this process, here are two case studies:

1. Lem works at a mid-sized automotive company. They have experienced a problem of long lead times, excess WIP, and late deliveries.

Lem decided to engage with VSM. This is the summary of his Current State Map:

• 14-day lead time from order to shipment.
• 5 inventory piles between 6 processes.
• Manual scheduling and overproduction in the early stages.

He then completed his Future State Map:

• Introduced a pull system with kanban between steps
• Balanced workloads based on takt time
• Set one pacemaker process with controlled flow

With this plan implemented, Lem was able to reduce lead time from 14 days to 4 days, inventory was reduced by 60%, and delivery was improved by 79%.

1. Xavier works at an urban outpatient facility that is experiencing long patient wait times and bottlenecks in triage. Xavier uses VSM to discover the following: 

• The average patient journey was 3 hours.
• There were registration delays, duplicated info entry, and a triage nurse bottleneck.
• Inconsistent communication between the admin and clinical teams caused delays as well.

Xavier implemented the following from his future state plan: 

• He standardized the intake form used to a digital version.
• He added float staff to support triage during peak times.
• He implemented real-time status boards and visual cues.

This allowed the centre to halve the patient journey time; first step triage was up to 95% in 15 minutes, and patient satisfaction increased by 30%.

12. Conclusion + Downloadable Templates / Tools

As you can see, VSM is key in following Lean principles for eliminating waste, increasing flow, and maximizing efficiency throughout the delivery of a product or service, whether it is in manufacturing, healthcare, logistics, construction, financial service or any other industry.

To help you begin your journey with VSM, you can access our PDF reference guide, PPT template for workshops, and Excel VSM template. 

These valuable tools will give you a springboard to dive into this exciting process. For more information, contact us, and we can provide further support.

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