Value Stream Mapping

Note: Alan just finished recording an Elegant Code Cast with me that will be published later.

I attended Alan Shalloway’s session at Agile 2008 on Value Stream Mapping. I have been wanting to pick up the skill of creating value stream maps for some time and this is a great introduction to the idea. Value Stream Mapping is essentially modeling a problem in terms of Lean and looking for opportunities to optimize your organization in terms of Lean.

Frankly, this looks like typical Business Process Modeling with the added dimension of the value you are trying to optimize for. It also looks similar Root Cause Analysis. I will definitely try this in the real word to see how effective a communication device this model can be.

Here are the steps of creating a value stream map.

1. Identify Actions Performed in the Value Stream
   1. Identify the stream of work between idea conceptualization and delivery to a customer
   2. Model the major process and gates involved in creation and delivery
2. Determine Calendar Time
   1. How long does it take to get from conceptualization to delivery
3. Calculate Time Actually Worked on the Action
   1. Measure time per person
4. Identify Times Between Actions
   1. How long do you pause in between actions?
5. Identify Loop Backs Required
   1. How much rework is occurring?
   2. How many pieces of work are being rejected for defects?
6. Identify how many items are waiting in any queues in the system.
   1. Are there any queues occurring before actions in the process?
   2. How large are they? Don’t go overboard here, just look for big or little.
7. Compute Process Cycle Efficiency
   1. Process Cycle Efficiency = Tome Worked/Total Cycle Time
      • This is pretty self evident and pretty cool. How many of us actually look at this?
      • 509 hrs/3433 hrs = 14.9% efficiency
      • This is worth shock value, but it the key is to raise the % by reducing the denominator
      • If you can approach 50% in software development, you are cooking well. Most teams run between .01% and 8%. Agile teams typically run around 30%.

Other Notes

• Single Piece Flow is always a theme with Alan and today was no exception. Single piece flow is a technique of optimizing the whole and reducing time to market by focusing on one thing at a time.
• Determine the prime metric of value before you begin. Are you measuring time, cost, quality, or what?
• Focus on delays and loop backs for optimizations
• Value streams may be created on a feature by feature basis
• “Metrics as they are applied today are almost always counterproductive.”
• “The best metric I know is end-to-end cycle time.”
• “Measuring the efficiency of a single step is extremely counterproductive.”