Value Stream Mapping has been successfully used by manufacturing since 1950, why not service organizations? Review this explanation accompanied with a service organization case study.

1.  Robert Baird
President
+1 215 353 0696
Value Stream Mapping for
Service (Case Study)
14-Jul-14 1www.leanteamsusa.com

2. 14-Jul-14 www.leanteamsusa.com 2
Receive
Order
Customer
Value

3. 14-Jul-14 www.leanteamsusa.com 3

5. Manufacturing
• Cycle Time
• Time to complete one unit (Minutes)
• Throughput
• Units/Hr.
• Uptime
• % of schedule processing units
• Changeover
• Preparation time for next order
• Inventory
• Unit WIP
• Defects
• Yield Loss%
• Distance Traveled
• From one process to another (Feet)
• Value Add Time
• Part of cycle time adding customer value
• Non-Value Add Time
• Part of cycle time adding no value to
customer
Service
• Cycle Time
• Time to complete one item (Hour)
• Throughput
• Items/Hr.
• Uptime
• % of work hours processing step items
• Changeover
• Preparation time for next order
• Inventory
• Item WIP
• Defects
• Item error%
• Distance Traveled
• From one process to another (Feet)
• Value Add Time
• Part of cycle time adding customer value
• Non-Value Add Time
• Part of cycle time adding no value to
customer
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Value Stream Term Comparison

6. www.leanteamsusa.com 6

7. Small sporting equipment
business is experiencing strong
growth but customers are
complaining about the time to
fulfill their orders
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Problem

8. 14-Jul-14 8
Reduction of Lead Time to
1 hour
Orders Processed per day
Increase capability to 40

9. Customer Order Process
www.leanteamsusa.com 9
Customer Requirement
Scheduled Time 7 Hours
Orders per day 30
Takt Time 0.23 Hr.
Receive
Order
2
Package
6 4
.33 Hr.
.17 Hr.
.14 Hr.
.14 Hr.
.75 Hr.
.25 Hr.
Order
Entry
Fulfill
1
.67 Hr.
.17Hr. Lead
Time =
2.62 Hr.
Receive Order
Cycle Time (Hr.) 0.17
Throughput (items/Hr.) 6
Items per day complete 30
Uptime (%) 71.4%
Changeover (min) 20
Inventory (WIP) (items) 2
WIP Time (Hr.) 0.33
Defects 99.99%
Distance travelled (Ft.) 400
Value Add Time (Hr.) 0.12
Non-Value Add (Hr.) 0.05
Number of People 1
Order Entry
Cycle Time (Hr.) 0.14
Throughput (items/Hr.) 7
Items per day complete 33
Uptime (%) 67.5%
Changeover (min) 10
Inventory (WIP) (items) 1
WIP Time (Hr.) 0.14
Defects 99.95%
Distance travelled (Ft.) 0
Value Add Time (Hr.) 0
Non-Value Add (Hr.) 0.14
Number of People 1
Fulfill
Cycle Time (Hr.) 0.25
Throughput (items/Hr.) 4
Items per day complete 34
Uptime (%) 60.0%
Changeover (min) 30
Inventory (WIP) (items) 6
WIP Time (Hr.) 0.75
Defects 98.00%
Distance travelled (Ft.) 2100
Value Add Time (Hr.) 0.2
Non-Value Add (Hr.) 0.05
Number of People 2
Package
Cycle Time (Hr.) 0.17
Throughput (items/Hr.) 6
Items per day complete 32
Uptime (%) 75.0%
Changeover (min) 20
Inventory (WIP) (items) 4
WIP Time (Hr.) 0.67
Defects 99.99%
Distance travelled (Ft.) 300
Value Add Time (Hr.) 0.08
Non-Value Add (Hr.) 0.09
Number of People 1
Total
0.73
4
30
80
13
1.89
97.93%
2800
0.4
0.33
5

10. Visual Review
www.leanteamsusa.com 10
Customer Requirement
Scheduled Time 7 Hours
Orders per day 30
Takt Time 0.23 Hr.
Receive
Order
2
Package
6 4
.33 Hr.
.17 Hr.
.14 Hr.
.14 Hr.
.75 Hr.
.25 Hr.
Order
Entry
Fulfill
1
.67 Hr.
.17Hr. Lead
Time =
2.62 Hr.
Receive Order
Cycle Time (Hr.) 0.17
Throughput (items/Hr.) 6
Items per day complete 30
Uptime (%) 71.4%
Changeover (min) 20
Inventory (WIP) (items) 2
WIP Time (Hr.) 0.33
Defects 99.99%
Distance travelled (Ft.) 400
Value Add Time (Hr.) 0.12
Non-Value Add (Hr.) 0.05
Number of People 1
Order Entry
Cycle Time (Hr.) 0.14
Throughput (items/Hr.) 7
Items per day complete 33
Uptime (%) 67.5%
Changeover (min) 10
Inventory (WIP) (items) 1
WIP Time (Hr.) 0.14
Defects 99.95%
Distance travelled (Ft.) 0
Value Add Time (Hr.) 0
Non-Value Add (Hr.) 0.14
Number of People 1
Fulfill
Cycle Time (Hr.) 0.25
Throughput (items/Hr.) 4
Items per day complete 34
Uptime (%) 60.0%
Changeover (min) 30
Inventory (WIP) (items) 6
WIP Time (Hr.) 0.75
Defects 98.00%
Distance travelled (Ft.) 2100
Value Add Time (Hr.) 0.2
Non-Value Add (Hr.) 0.05
Number of People 2
Package
Cycle Time (Hr.) 0.17
Throughput (items/Hr.) 6
Items per day complete 32
Uptime (%) 75.0%
Changeover (min) 20
Inventory (WIP) (items) 4
WIP Time (Hr.) 0.67
Defects 99.99%
Distance travelled (Ft.) 300
Value Add Time (Hr.) 0.08
Non-Value Add (Hr.) 0.09
Number of People 1
Total
0.73
4
30
80
13
1.89
97.93%
2800
0.4
0.33
5

11. Path to Charter Objectives
• Determine new Takt time
• Identify downtime causes
• Eliminate or combine unnecessary process
steps (non-value add)
• Reduce items waiting in WIP
• Reduce distance travelled between process
steps – question current layout
www.leanteamsusa.com 11
Customer Requirement
Scheduled Time 7 Hours
Orders per day 40
Takt Time 0.17 Hr.

12. Identify Solutions to Meet Charter
www.leanteamsusa.com 12
Lead Time
Combine process steps
New layout (cell structure)
One Piece Flow
Throughput
Kaizen downtime causes
Improve changeover time
Improve Quality
WIP Reduction Increase Operator Uptime

13. Customer Order Process
www.leanteamsusa.com 13
Customer Requirement
Scheduled Time 7 Hours
Orders per day 40
Takt Time 0.175 Hr.
Receive & Enter
Order
1 1
.17 Hr.
.17 Hr.
.10 Hr.
.20 Hr.
Fulfill Package
1
.17 Hr.
.17Hr. Lead
Time =
0.97 Hr.
Receive & Enter Order
Cycle Time (Hr.) 0.17
Throughput (items/Hr.) 6
Items per day complete 40
Uptime (%) 95.0%
Changeover (min) 12
Inventory (WIP) (items) 1
WIP Time (Hr.) 0.17
Defects 99.99%
Distance travelled (Ft.) 10
Value Add Time (Hr.) 0.16
Non-Value Add (Hr.) 0.01
Number of People 1
Fulfill
Cycle Time (Hr.) 0.20
Throughput (items/Hr.) 5
Items per day complete 42
Uptime (%) 60.0%
Changeover (min) 15
Inventory (WIP) (items) 1
WIP Time (Hr.) 0.10
Defects 99.99%
Distance travelled (Ft.) 8
Value Add Time (Hr.) 0.2
Non-Value Add (Hr.) 0.00
Number of People 2
Package
Cycle Time (Hr.) 0.17
Throughput (items/Hr.) 6
Items per day complete 40
Uptime (%) 95.0%
Changeover (min) 8
Inventory (WIP) (items) 1
WIP Time (Hr.) 0.17
Defects 99.99%
Distance travelled (Ft.) 20
Value Add Time (Hr.) 0.12
Non-Value Add (Hr.) 0.05
Number of People 1
Total
0.53
5
40
35
3
0.43
99.97%
38
0.48
0.06
4

14. • Combining process steps because of a new layout reduced information and
product travel, this was the most significant contribution towards achieving
the growth to 40 orders per day and reduction of lead time by -63%
• Non-value added time was reduced by -81.8% through combining process
steps and two Kaizen events.
• Reducing changeover time contributed towards improving Uptime
• New layout enabled “one piece flow” of order completion and one less
person (this person moved to continuous improvement efforts)
• Improving quality at Fulfill step contributed towards improving Uptime
14-Jul-14 14
Result

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14-Jul-14 www.leanteamsusa.com 15