International Conference on Industrial Engineering and Business Management, Yogyakarta

2010

Value Stream Mapping:

Eliminating Waste and Adding Value
Sunday Noya#1
#

Industrial Engineering Department, Ma Chung University

1
sunday.alexander@machung.ac.id

Abstract - This paper explains the nature of Value Stream

Mapping and provides the idea of this lean method by defining it
and explaining the purpose and benefit of using it in production
process. Furthermore, this paper elaborates the steps of
conducting VSM and explains how to apply the method on a
process. To make the explanation clear, detail exposure of
implementing the steps and examples is provided.
Keywords Value Stream Mapping, Current State Map, Future
State Map

I. INTRODUCTION
There are several definitions proposed by academics and
practitioners about Value Stream Mapping (VSM). The
following definitions gathered from the literature provide
important aspects of a more complete definition, presented at
the end of this section. VSM is a pencil-and-paper tool that
helps users recognize the flow of material and information as
products make their way through the value stream. The value
stream includes the value-added and wasted activities that are
needed to bring a product from raw material through delivery
to the customer [1]. While Tony Manos describes Value
Stream Mapping as a tool that combines processing steps and
information flow to be used to create a solid operation plan
that will make the most of the available resources. Value is
added to the product or service by changing the form or
function to meet customers needs [2].
Further, James Womack [3] define it as a lean tool that can
help companies level production, resulting in spectacular
reductions in throughput time and costs, and improved quality.
Therefore, I complete define Value Stream Mapping as a tool,
a stream map drawn on a piece of paper, or a method used by
manager or engineer to visualize all the steps required in
production or service process, and all information and
material flow from raw material to the customer. This
information is used to identify waste in the process and to
optimize result by planning a more efficient and effective
process which reduces the waste and adds value.

II. THE NATURE OF VALUE STREAM MAPPING

These days, when increasing demands for high levels of
performance makes most of organisations in the world attempt
to build efficient processes in their working system, an
effective concept is needed to guide this effort. Lean is one of
the most widespread concepts applied in many manufacture
companies. One of lean powerful tools applied to assist the
creating of efficient process is VSM.
A. Brief History
This method of reducing waste in the process to achieve the
optimum benefit inside an organisation was pioneered in the
1980s by Toyotas Chief Engineer, Taiichi Ohno, and Shigeo
Shingo. It was then popularised by Mike Rother and John
Shook in their book Learning to See. When developed this
concept Ohno identified seven common wastes in every
production process. They are overproduction - producing
items for which there are no orders; waiting time - employees
standing about; unnecessary transport - moving material
unnecessarily over long distances; over-processing - using
more steps to produce a product than necessary; excess
inventory - retaining unnecessary inventory between workinprocess steps; unnecessary movement any wasted motion by
man or machine; and defect - making incorrect products [4].
Using the VSM all these waste are trying to be identified and
eliminated.
B. Purposes and Benefit of Using Value Stream Mapping
Value Stream Mapping is designed to visualize the system
of the process from start to finish in system perspective. It is
also used to clearly see the overall process stream and
recognise the waste in the process; hence, they can be
eliminated. This method also recognizes each important action
needed to create the desired value [3]. Therefore we can
provide optimum value to the customer through a complete
value creation process with minimum waste. VSM also help
us in providing plan for implementing step by step
improvements procedures to the production process. Lastly, it
facilitates us to transform the process into more efficient and
effective way, reduce costs and enable broad involvement in
creating valuable future state.

International Conference on Industrial Engineering and Business Management, Yogyakarta

C. Disadvantages of Value Stream Mapping
Value Stream Mapping is a good method to reach optimal
product, but it still has disadvantages. Researchers at The
Ohio State University identified three weaknesses of VSM
like: failure to show multiple products that do not have
identical routings; lacks of economic measured value; and
failure to capture the time value in money value.
III. THE STEPS IN CONDUCTING VALUE STREAM MAPPING
There are several approaches to determine the steps in
conducting VSM. Following is the VSM step proposed by
Tony Manos in [2]. The first step is understanding the scope
of the value stream. The second step is forming a crossfunctional team. The team is formed that includes supervisory
or managerial level members from all through the
organization. Includes the representatives from sales,
customer service, scheduling, purchasing, operations,
inventory control, maintenance, quality and information
technology as contributors to VSM event. Customers or
suppliers participation can also be a unique perspective.
The third step will be the core of conducting VSM. It called
kaizen event, the continued improvement. In this stage, the
team create the current state map and the future state map
along with the draft plan. There are four important steps in
this stage:
A. Determine the Product Family
A Product family is a cluster of products or services that
have the same or similar processing steps. To determine the
process family, a matrix is created as in Fig.1.
Along the top row, write all the process steps your
organization performs.
In the first column, write down the parts (for example,
components, stock keeping units, finished good items
or services) your organization makes or provides.
Place an X in the corresponding box if the part goes
through the processing step.

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workers using similar or related steps more efficiently in a

manufacturing cell.
B. Draw the Current State Map
To create a current state map, gather the data and
information by walking the flow and interviewing the worker
who carry out the task. Do not depend on historical data or
opinion [5]. The current state map must show the
organisation's processes performed at the present work
settings.
From walking the flow, the team can collect several types
of information on a worksheet, such as cycle time or
processing time, changeover time, reliability of equipment,
quantities, number of operators and shifts, hardcopy
information, electronic information, inventory levels, and
queue or waiting times.
Data collected from walking the flow and the resulting
team discussions then will be drawn on paper. VSM can be
drawn using simple symbols or icons.

Fig. 2 Material Flow Icons

Fig. 3 Information Flow Icons

(Source: Learning to See, Rother & Shook 2006)

Fig. 1. Process Family Matrix

After finishing this step, examine the matrix and find the
parts that have a similar or the exact same processing steps
and procedures that can be created together by the same

There are key areas on the map. The upper right corner for
customer information; the upper left corner for supplier
information; the top half of the paper for information flow; the
bottom half for material (or product) flow; and the gutters on
top and bottom to calculate value added and non value added
time.
Calculate the cycle time vs. the inventory time (in days) for
the material and information flow. Every VSM will be slightly

International Conference on Industrial Engineering and Business Management, Yogyakarta

different depending on the exact process, the creator who
drew the map and how it was drawn.

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Are the first pass yield or quality levels acceptable? Do

we need to create a new layout for an area?

(Source: Lean and Environmental Toolkit Training Module, 2006)

Fig. 4 Current State Map Example

(Source: Lean and Environmental Toolkit Training Module, 2006)

Fig. 4 Future State Map Example

After map the current state of the value stream, waste

throughout the stream must be identified and removed to
On the map, place a kaizen burst around any items to
shorten lead-time and improve the value-added percentage. indicate that they need improvement. These Items may
However, the only way to identify the waste is to understand include low equipment reliability or first pass yield, long
the seven elements that do not add the value to the product [1]. changeover times, large batches, any waste such as
overproduction, motion, transportation, waiting, defects or
C. Determine the Future State Map
adjustments, and over or extra processing. Place the kaizen
The next step is setting the future state map. To develop a burst at any place where we are not sure whether improvement
realistic future state map, team members need the basic is needed. That can be determined later when the general plan
knowledge of lean principles. Here is a short list of questions is set.
identified by Manos in [2] as guidance for creating a future
state map with common elements that may fit most types of D. Draft a Plan to Arrive at the Future State
business:
The most important stage of VSM is creating or executing
What is the takt time? Takt time is the time to finish a the draft plan. The draft plan is created based on the
complete product. The formula of takt time is the time information from the future state map; it is a strategy about
available (per shift) divided by the demand (per shift). what action should be taken to arrive at Future State Map. The
For example: 22,000 seconds (time available) 200 plan will need further modification especially in determining
pieces (demand) = 110 seconds/piece.
resources required, such as time, labour and budgets. A good
Are there constraints? From the information gathered plan will include the description of the project, name of the
during the kaizen, look at processing times. If any of project leader, possible team members, a schedule of events
these are greater than takt time, it might be a constraint. and deliverables, an estimate of costs, and the impact, goals or
This may cause overproduction waste or work in benefits.
process (WIP) or extra processing time, such as
overtime.
Where can inventory (or queue time) be cut or
supermarkets used? Look at raw material, WIP, buffer
stock, safety stock and product inventories to see
whether these can be reduced. Does it make sense to
put in a supermarket replenishment system?
Where can you improve flow? Is it possible to put
materials into a cell or eliminate materials from
stopping and waiting? If flow improvement is
Source: Value Stream Mapping An Introduction, Manos 2006)
impossible, can a first in and/or first out lane be
Fig. 5 Example of VSM Plan
established between processes?
What other improvements are required? For example,
does the reliability of equipment need to be enhanced?

International Conference on Industrial Engineering and Business Management, Yogyakarta

IV. CONCLUSIONS
As a summary, Value Stream Mapping is a method used to
visualize all the steps required in process, and all information
and material flow from raw material to the customer. This
data is used to identify waste in the process and to optimize
result by planning a more efficient and effective process
which reduces the waste and adds value. The steps of VSM
can be summarized into four major steps: define the process
family; draw the Current State Value Stream Map; create the
Future State Value Stream Map; and develop the draft plan to
arrive at Future State Value Stream Map.

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