VSM Value Stream Mapping

 VSM - Value Stream Mapping :

Irrespective of type & size, every business is objectively working towards making a turnover with help of product or services, to cater the end user & thereby make some earning for themselves.

Manufacturing of any products or catering any services for end users includes many functions & operations at different levels, that eventually becomes part of the net cost of that very product or service.

In every open market where anyone & everyone is free to introduce or sell similar products & services, cost at which they are offered becomes the determining factor, complimented with other benefits that again may come at some cost to the end users.

It is hence very important to carry out these Value Stream Mapping of every business to help identify functions & activities that a customer will be ready & eager to pay for (Known as Value Adding Activity- VA)& those that customers are not going to benefited from them or may not be willing to pay for it (Known as Non Value Adding Activity - NVA).

Moreso, there might be some functions & activities that may be non valued adding but yet essential, which may be termed as Essential NVA.

Let us view an example to have a better understanding, The process starts with one basic Question, What are we doing that a customer will be happy to pay & what are we doing that a customer will not be willing to pay? 

We may take an example of a bread packet as a finished product & try to define what as an end user we may be willing to pay for.

A) Clean Crusts on the sides.

B) Equal slicing from top to bottom.

C) At least one side can be clear to see the level of baking.

D) Plastic packaging must be crystal clear.

E) Sealing must be air tight.

F) Brand name & manufacturing dates & expiry dates must be clear.

G) Of course as we use these bread it should taste as it was last time, that is consistency in quality.

So now as a customer, end user, these are the most important & critical expectations we have from a product, bread. While if we may look into the manufacturing process of a bread, there might be more than 20 to 30 critical checkpoints that they may have to maintain in order to deliver on above expectations. While there might be some other functions & activities that might not be necessary as they do not converge into the above mentioned expectation & by removing those functions & activities there is likely to be no change in the results of the end product. Those functions & activities known as NVA are still cost adding factors to the end product & if removed, either the product becomes more profitable or competitive in the market.

While there are some Essential Non Value Adding Activities, like time keeping at the gate of the bakery, security lights & CCTV set up, these kinds of costs may not bring any direct benefits to the end user but are essential for the operations & hence cannot be avoided.

The objective of VSM is to identify the functions & activities that can be eliminated or modified to reduce the cost & save some resources, without changing the quality or services, whereas in most of the cases after VSM the product or service quality improves as the analysis is customer centric, while the cost of producing the product or providing the given services may also reduce significantly.

Each desk & department can be given these responsibilities to do their own VSM that can be verified by cross functional assignments, it is an in-house process that can start and end within a shortest period of time giving an insight for action plans that can lead the way to 5 S & Kaizen.