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Optimizing Value Streams and Processes

Value streams are getting a lot of attention these days for a couple of reasons. One is that value streams allow us to identify opportunities to minimize waste or bottlenecks across organizations, processes and functional silos, and to improve the flow of value. Organizations adopting DevOps, for example, are using value stream mapping as a way to improve the flow of activities during the software development lifecycle, and to improve cross-functional collaboration. Another reason is that value streams direct our attention to what customers value. For example, organizations can use value stream mapping to streamline new product development activities, improve time-based measures such as lead time and time to market, and identify ways to improve product quality. They can also use it to streamline the activities involved in integrating a new employee into the company and its culture. What these both have in common is that the focus is on optimizing the value-adding activities; with the understanding that value is defined from the perspective of the customer.

A value stream is the sequence of activities required to design, produce, and deliver a specific product or service. So how is this different than a process, typically defined as interrelated work activities that take specific inputs and produce specific outputs that are of value to a customer? After all, both look at activities.

In our Value Stream Mapping Fundamentals course, we explain that value stream maps and process maps look at work at different levels of granularity for different purposes. Both have a place. Looking at both lets you zoom in and zoom out to see the work at the level you want.
  • Value stream maps – show the major process steps in a value stream at a macro-level and represent a strategic direction (why and where work is done)
  • Process maps – trace the sequence of activities for a single process at a micro-level and help identify tactical improvements (how work is done)
Value stream mapping enables cross-functional teams to visualize an entire value stream from a work and information flow perspective (i.e., the ‘as is’ state), establish a common language, and identify areas of waste that could be minimized or eliminated in an effort to improve flow and deliver greater value (i.e., achieve a target future state). Value stream mapping is an invaluable tool but it is just the start of the improvement journey. An output of a value stream mapping effort is a transformation plan that outlines the various experiments and improvements that can be used to iterate to the target future state. To be clear, this is not a ‘fixed’ project plan that suggests there are specific steps that can be taken by X date and all will be well. The key is to set the organization up to try something new and learn. To accept that each change might shift what the next step needs to be.

In addition to experiments, the improvements undertaken as part of the transformation plan will likely include Kaizen events, organizational change management activities, continual improvement projects, and process improvement projects. In our Certified Process Design Engineer (CPDE) course, we introduce Ten Process Design and Improvement Steps along with relative tools and techniques. Yes, simply put, there is a process for designing and improving processes. We also talk about how to leverage standards and frameworks such as ITIL®, COBIT, and KCS to design, re-engineer and improve ITSM processes.

Please don’t let all the recent talk about value streams lead you to believe that processes are no longer important. What is important is thinking about processes in the context of their greater value stream. By doing this, organizations can avoid over-optimizing processes (to the detriment of a value stream) and losing sight of what’s important to their customers. They can also avoid wasting precious time and effort improving a process that is ‘good enough’ while failing to devote the time and effort needed to address processes that are wasteful or that are constraints on a value stream.

Value streams and processes by their very nature drive standardized ways of doing things. What are the implications of this? One is that you create automation opportunities and the ability to leverage modern smart technologies (the Fourth Industrial Revolution). Remember, however, the old adage… if you’re doing things wrong and you automate them, you’ll do them wrong faster. Another implication is the potential to stifle innovation if processes are overly rigorous. The goal is to put in place ‘just enough’ process to meet business needs.
Written by Donna Knapp

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