Value Stream Mapping

Create Lean value stream maps to visualize flow, identify waste, and design improvement opportunities. Based on Lean manufacturing principles adapted for knowledge work.

What is a Value Stream?

A value stream is the sequence of activities required to deliver value to a customer, from request to delivery. Value stream mapping (VSM) visualizes this flow to identify:

• Value-adding activities - Steps that directly create customer value
• Waste (Muda) - Steps that consume resources without adding value
• Flow problems - Bottlenecks, delays, and inefficiencies

The 8 Wastes (TIMWOODS)

Workflow

Phase 1: Define Scope

Step 1: Identify the Value Stream

Step 2: Set Boundaries

## Value Stream Definition

**Name:** Customer Order Fulfillment
**Trigger:** Customer places order
**End State:** Customer receives product
**Scope:** Order entry → Shipping (excludes manufacturing)
**Customer:** External retail customer

Phase 2: Current State Map

Step 1: Walk the Process

Observe actual work (gemba walk):

• Follow a real work item through the process
• Document what actually happens, not what should happen
• Note handoffs, delays, and workarounds

Step 2: Document Process Steps

For each step, capture:

Step 3: Create Current State Map

## Current State Value Stream

| Step | Owner | PT | LT | %C&A | Inventory | Notes |
|------|-------|-----|-----|------|-----------|-------|
| Order Entry | Sales | 15m | 2h | 85% | 50 orders | Manual entry |
| Credit Check | Finance | 10m | 8h | 95% | 30 orders | Batch processing |
| Inventory Alloc | Warehouse | 5m | 4h | 90% | 20 orders | System lookup |
| Pick & Pack | Warehouse | 30m | 6h | 92% | 40 orders | Manual process |
| Ship | Logistics | 10m | 24h | 98% | 100 orders | Carrier pickup |

**Total Process Time:** 70 minutes
**Total Lead Time:** 44 hours
**Flow Efficiency:** 2.7% (PT / LT)

Phase 3: Analyze Waste

Step 1: Calculate Flow Efficiency

Flow Efficiency = Process Time / Lead Time × 100%

Example: 70 min / 2640 min = 2.7%

Interpretation:

• < 5%: Significant waste (typical for unoptimized processes)
• 5-15%: Moderate efficiency
• 15-25%: Good efficiency

• 25%: Excellent (rare for knowledge work)

Step 2: Identify Waste by Type

## Waste Analysis

### Waiting (45% of lead time)
- Credit check batch processing: 8 hours → could be real-time
- Carrier pickup schedule: 24 hours → could be on-demand

### Inventory (150 orders WIP)
- Orders queue at each step
- No pull system in place

### Defects (15% rework at order entry)
- Manual data entry errors
- Missing required fields

### Overprocessing
- Full credit check for returning customers
- Duplicate data entry across systems

Step 3: Identify Bottlenecks

The constraint (bottleneck) limits the entire system:

## Bottleneck Analysis

**Primary Bottleneck:** Credit Check
- Highest queue (30 orders)
- Batch processing creates 8-hour wait
- Blocks downstream flow

**Secondary Bottleneck:** Pick & Pack
- Manual process
- Variable cycle time

Phase 4: Future State Design

Step 1: Apply Lean Principles

Step 2: Design Improvements

## Future State Design

### Eliminate Waiting
- Real-time credit API vs. batch
- On-demand carrier pickup

### Reduce Inventory
- WIP limits at each step
- Pull signals between steps

### Improve Quality
- Validation at order entry
- Auto-populate from CRM

### Automate Motion Waste
- Single system vs. multiple tools
- API integrations

Step 3: Create Future State Map

## Future State Value Stream

| Step | Owner | PT | LT | %C&A | Inventory | Changes |
|------|-------|-----|-----|------|-----------|---------|
| Order Entry | Sales | 10m | 30m | 98% | 10 orders | Validation, auto-fill |
| Credit Check | System | 1m | 5m | 99% | 0 | Real-time API |
| Inventory Alloc | System | 1m | 5m | 99% | 0 | Automated |
| Pick & Pack | Warehouse | 25m | 2h | 96% | 15 orders | Better tooling |
| Ship | Logistics | 10m | 4h | 99% | 20 orders | On-demand pickup |

**Target Process Time:** 47 minutes (33% reduction)
**Target Lead Time:** 6.7 hours (85% reduction)
**Target Flow Efficiency:** 11.7% (4x improvement)

Phase 5: Implementation Roadmap

Step 1: Prioritize Improvements

Step 2: Define Kaizen Events

Focused improvement workshops:

## Kaizen Event: Credit Check Automation

**Scope:** Eliminate credit check batch processing
**Target:** 8 hours → 5 minutes lead time
**Team:** Finance, IT, Process Owner
**Duration:** 1 week intensive
**Deliverables:**
- API integration specification
- Process redesign
- Training materials

Output Formats

Narrative Summary

## Value Stream Analysis Summary

**Value Stream:** [Name]
**Date:** [ISO date]
**Analyst:** value-stream-analyst

### Current State Metrics
- **Process Time:** X minutes
- **Lead Time:** Y hours
- **Flow Efficiency:** Z%
- **Primary Bottleneck:** [Step]

### Top Waste Categories
1. **Waiting (X% of LT):** [Description]
2. **Inventory (X orders WIP):** [Description]
3. **[Other waste]:** [Description]

### Future State Targets
- **Lead Time Reduction:** X%
- **Flow Efficiency Target:** Y%
- **Quality Target:** Z% first-time right

### Recommended Actions
1. [High priority improvement]
2. [Medium priority improvement]
3. [Lower priority improvement]

Structured Data (YAML)

value_stream:
  name: "Customer Order Fulfillment"
  version: "1.0"
  date: "{ISO-8601-date}"
  analyst: "value-stream-analyst"

  boundaries:
    trigger: "Customer places order"
    end_state: "Customer receives product"
    customer: "External retail customer"

  current_state:
    total_process_time_minutes: 70
    total_lead_time_hours: 44
    flow_efficiency_percent: 2.7
    wip_total: 240

    steps:
      - name: "Order Entry"
        owner: "Sales"
        process_time_minutes: 15
        lead_time_hours: 2
        complete_accurate_percent: 85
        inventory: 50
        waste_types:
          - type: defects
            description: "Manual entry errors"
          - type: motion
            description: "Multiple system entry"

      - name: "Credit Check"
        owner: "Finance"
        process_time_minutes: 10
        lead_time_hours: 8
        complete_accurate_percent: 95
        inventory: 30
        is_bottleneck: true
        waste_types:
          - type: waiting
            description: "Batch processing"

  waste_analysis:
    - type: waiting
      percent_of_lead_time: 45
      root_causes:
        - "Batch processing"
        - "Scheduled pickups"

    - type: inventory
      total_wip: 240
      root_causes:
        - "No WIP limits"
        - "Push system"

  future_state:
    target_process_time_minutes: 47
    target_lead_time_hours: 6.7
    target_flow_efficiency_percent: 11.7

    improvements:
      - name: "Real-time credit API"
        waste_eliminated: waiting
        impact: high
        effort: medium
        lead_time_reduction_hours: 7.9

  roadmap:
    - phase: 1
      improvements: ["Real-time credit API", "Order validation"]
      duration_weeks: 4

    - phase: 2
      improvements: ["On-demand carrier", "Inventory automation"]
      duration_weeks: 8

Mermaid Diagrams

Current State Flow:

flowchart LR
    subgraph Current State
        A[Order Entry<br/>PT: 15m | LT: 2h<br/>WIP: 50] --> B[Credit Check<br/>PT: 10m | LT: 8h<br/>WIP: 30]
        B --> C[Inventory<br/>PT: 5m | LT: 4h<br/>WIP: 20]
        C --> D[Pick & Pack<br/>PT: 30m | LT: 6h<br/>WIP: 40]
        D --> E[Ship<br/>PT: 10m | LT: 24h<br/>WIP: 100]
    end

    style B fill:#ff9999

Future State Flow:

flowchart LR
    subgraph Future State
        A[Order Entry<br/>PT: 10m | LT: 30m<br/>WIP: 10] --> B[Credit<br/>API: 1m<br/>WIP: 0]
        B --> C[Inventory<br/>Auto: 1m<br/>WIP: 0]
        C --> D[Pick & Pack<br/>PT: 25m | LT: 2h<br/>WIP: 15]
        D --> E[Ship<br/>PT: 10m | LT: 4h<br/>WIP: 20]
    end

    style B fill:#99ff99
    style C fill:#99ff99

When to Use

Integration

Upstream (Discovery)

• process-modeling - Understand current process
• capability-mapping - Link to business capabilities
• stakeholder-analysis - Identify process owners

Downstream

• Requirements - Improvement requirements
• Systems design - Automation opportunities
• Project planning - Kaizen event planning

Related Skills

• journey-mapping - Customer experience perspective
• capability-mapping - Capability view of value delivery
• root-cause-analysis - Investigate bottleneck causes
• prioritization - Prioritize improvement initiatives
• process-modeling - Detailed BPMN process diagrams
• estimation - Estimate improvement effort
• benchmarking - Current vs target comparison

Version History

• v1.0.0 (2025-12-26): Initial release