One of the starting activities of the Lean Production System is "Value Stream Analysis." This analysis can be applied to production processes, and it can also be applied to all functional processes. It can be used as an important leverage point for a Lean Production System transformation project.
Let us start first with the concept of "Value." In principle, value can be expressed as an operation or a service that the customer is willing to pay money for. While this value, which is worth money, is being brought about, it passes through certain intermediate stages. Some of these intermediate operations create a value that the customer is willing to pay for. Some operations create no value at all. For example, operations such as transportation, inspection, storage, and type change are operations we have to perform, but that do not create a value. On an injection molding machine, a product coming into being is value-adding work. The mold change before production, and the inspection operation performed after production, are work that has no added value from the customer's point of view. As another example, a machine waiting for work to arrive from the machine before it is a valueless operation. Similarly, finished products or intermediate materials waiting or being stored in the warehouse or in production add no value to the product.
In every case, whether it is a production process or a service process, every process contains a series of intermediate operations that have added value and that do not. At the end of these operations, a product emerges that the customer is willing to pay a price for. When we take the competitive environment into account, the business that has eliminated the operations without added value will naturally have greater competitive strength. Because, in this competitive environment, the producing company cannot freely set the sales price of a product. The price of the product is determined by the market and by customers. As a result, the way to reduce costs and to be competitive is to eliminate, or at least reduce, the operations that do not have added value.
"Value Stream Analysis" is a study carried out for this purpose. It is a study carried out by making the selected process visual in all its stages, and by compiling all the parameters related to each stage and expressing them together. The first goal is to reveal the current state of the process being examined.
For each process stage, data such as processing time, setup time, the inventory level before the operation, the inventory level after the operation, the labor expended, capacity, and working hours are collected. In addition, the raw material inventory level and the finished-product inventory level are added to the table. On top of this data, shipment frequency, the planning process, and the work-order process are also added to the study as a flow diagram. In the end, a picture of the process under examination, with all its details, fitted onto a page of A4 size, is obtained.
The visual obtained helps various analyses of the process to be made. One of these is the overall inventory level. It can be calculated whether more inventory than necessary is being held. Most importantly, it is calculated whether the total time of the process ( Cycle Time ) matches the cycle time demanded by the customer ( Takt Time ). This is a critical indicator. On the other hand, the variants of the products leaving the process, and the capacity utilization rates, can be calculated. Accordingly, the stages that are a "bottleneck" are identified. In the end, by making this and many similar inferences, a detailed added-value analysis can be carried out.
A large part of the data compiled in this study can also be used in calculating operation costs. In this way it can be understood whether there is a difference from the target price determined by the market.
The next stage(s) are "Value Stream Design" studies, aimed at removing the inconsistencies and difficulties identified in the value stream analysis. In these studies too, the aim is to remove bottlenecks, eliminate non-value-adding work, and balance cost.
You can find a sample study for value stream analysis below.
M. Fatih Sütçüler