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2025 January TPM University Newsletter

Welcome to 2025! I am excited to see where the TPM domain infused with GenAI will be taking us. And focusing my career at the moment in SRE, I am anticipating some exciting things in that space as well.

Doron Katz

Dec 30, 2024 — 5 min read

Photo by No Revisions / Unsplash

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⭐️ What is Value Stream Mapping?

Recently, I completed a brief course on PMI’s Value Stream Mapping (VSM) and would like to share my insights gained from the experience. Value Stream Mapping (VSM) is a lean management technique employed to document, analyze, and enhance the flow of information or materials necessary for the production of a product or service. It presents a comprehensive visual representation of each step within a process, thereby identifying waste and optimizing workflows to augment efficiency.

What is a Value Stream?

A value stream according to PMI consists of a set f actions that take place to add value for customers “from the initial request through realization of value by the customers” and forms one of four layers of the Disciplined Agile® (DA™) tool kit, depicted below.

PMI categorize value streams as one of three types 1) development value stream encompassing activities related to operational value streams, 2) operational value stream encompassing activities necessary to deliver a product or service to customer (explicit value drivers often expressed in OKRs), and 3) support value stream which comprises of activities supporting the organization, development, and operational value streams (such as databases, security measures).

In the following diagram, the stream starts off with a customer ordering a ride, and the operational value stream discovering drivers nearby, and notifying the driver to pick up the passenger, terminating with the designation of the driver. The development value stream consists of three software engineering teams authoring and deploying the code into production. Additionally, there is a support value stream consisting of the database to support the platform as well as OKRs to guide the business metrics.

What is Value Stream Mapping?

Value Stream Mapping goes further by visualizing the flow of value of their product or service from conception or design to its final deployment form, encompassing all actions, value and non-value-creating along the way, denoting interfaces between activities, loop backs, and the time/queues involved in and between these process steps.

PMI explain that while you may use current state (“as-in”) to map value, they advocate that it is more helpful to begin with an idealized development value stream as a basis for having conversations, akin to a Pareto analysis. That is, get a good enough picture to facilitate engagement, identifying areas of improvements that will address 80% of the issues and repeat the process incrementally to find the next constraint or waste. The following diagram from PMI can be evaluated as follows:

Request as the initial step takes 0.5 hours with no additional wait time;
Approve step takes 0.1 hours of work but 7.9 hours of waiting time;
Requirements step takes 60 hours of active with an additional 100 hours of waiting time;
Sign Off requires 1 hour of active work but entails 7 hours of waiting time; and
Analysis takes 40 hours of active work with an additional 60 hours of waiting time.

Further examining the process diagram we can highlight some inefficiencies, such as rejections and defects leading to additional work.

20% Rejection Rate: The “Approve” step has a 20% rejection rate, causing rework and repeating this step once;
65% Defective Rate: The “Sign Off” step has a 65% defect rate, which means this step is repeated three times on average.
The red text in the diagram denotes the time between steps (delay in transition from one stage to the next).

Evaluating our value stream through mapping we can make a few assertions here. There is a high delay cost for waiting, a high defect rate (65% at sign-off) resulting in considerable rework and added time, and substantial rework cycles (rework for approve and sign-off). These highlighted inefficiencies present opportunities for improvement.

Benefits of Value Stream Mapping

Understanding the benefits of Value Stream Mapping is crucial for organizations seeking to enhance their efficiency, effectiveness, and customer satisfaction. By mapping out the value stream, organizations can identify bottlenecks, inefficiencies, and opportunities for improvement. This knowledge empowers them to make informed decisions, optimize processes, and deliver exceptional customer experiences.

Identifying Waste: VSM helps in identifying and eliminating waste, which can be in the form of time, resources, or materials. This results in more streamlined operations.
Improving Efficiency: By visualizing the entire process, teams can pinpoint bottlenecks and areas for improvement, leading to increased efficiency and productivity.
Enhancing Communication: VSM creates a common language for discussing processes and improvements, facilitating better communication across teams.
Focus on Customer Value: It emphasizes on enhancing customer value by focusing efforts where they have the most impact and aligning all activities to meet customer needs effectively.

According to PMI:

The key aspect of a value stream map is that it creates visibility about the work that is taking place. This helps people to have conversations about the current state, explore the effectiveness of existing processes, identify areas of waste, and propose new ways of working. While the numbers can be helpful (especially in classic lean approaches), in knowledge work the biggest benefit comes from visibility and conversations.

When Not to Use Value Stream Mapping?

Conversely, you may consider not using VSM because it is costly to implement as well as time-consuming, especially for large processes with numerous steps. Having said that, you can explore creating further decomposed VSM for sub-processes to find improvements incrementally. Implementing VSM is also not a once-off but a continuous commitment as new processes and steps get added, many may get removed over time, resulting in cascading effects.

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