The ABC of the Value Stream Mapping (VSM)

Value Stream Mapping (VSM) is a lean technique that has become deeply ingrained in the practices of IT service management (ITSM), DevOps, IT4IT, and Agile (Scrum, SAFe, Kanban).

Over a century old, VSM is the best technique to obtain a customer-focused agreement on improving a cross-departmental flow of activities. It’s a simple concept but difficult to begin and sustain in practice. 

In this article, we will:

• Introduce the concepts of Value Stream Mapping (VSM) and Management, along with its benefits and caveats.
• See how to put the process mapping into action (with examples).
• Explore the metrics that guide continuous improvement and collaboration.
• And share some tips to begin your VSM journey.

Let’s begin!

What is Value Stream Mapping? Definition (and a bit of history)

The premise of Value Stream Mapping is that leadership is not receiving the data they require to keep the organization competitive and compliant while ensuring that the activities of their employees or vendors are safe and fulfilling – enabling their strategy and expected outcomes.

Gartner, Forbes, HBR, and Forrester agree that VSM will provide your organization with the attitude and behavior necessary to survive in our VUCA and digital economy.

The iceberg of leadership knowledge best portrays this dilemma. In short, it shows that executives only know 4% of their company’s problems. This might sound strange, but consider your service desk for a minute: how aware are executives of technology challenges, the motion waste introduced with form shuffle, or inefficient processes? 

Value Stream Mapping stipulates that helping customers is a daily improvement activity that requires active leadership assistance to remove obstacles and for all of the team to perform to a high standard.

Charles E. Knoeppel mentioned that VSM was first mentioned over a century ago. ITIL 4 and DevOps portray these values, highlighting the importance of customer focus on service management and software development. It was then popularized by Prof. Daniel Jones, Jim Womack, and John Schook. VSM is further discussed in the DevOps Handbook and forms the leadership aspects of SFIA8.

Before we continue, it’s essential to define the concepts involved in Value Stream Mapping so we’re all on the same page.

• Value: it refers to the things an organization believes are of importance, worth, or usefulness, underpinning the attitude, behavior, decision-making, and culture.
• Stream: in knowledge-work, it’s the flow of tasks and data required to achieve an outcome for a customer or other aspect of the organization.
• Value stream: the Lean Enterprise Institute, Inc. (LEI) defines it as “all of the actions – both value-creating and non-value-creating – required to bring a product from concept to launch (also known as operational value stream). These include actions to process customer information and transform the product on its way to the customer.”
• Value Stream Mapping: Value Stream Mapping – also defined by the LEI – “is a senior-level management collaborative exercise to ascertain the truth of what is happening creating tension and cooperation on how to empower staff towards continuous improvement."
• Value Stream Management: it refers to the active supervision and involvement of leaders of value streams to ensure that obstacles addressed do not present new challenges.
• Process map: a micro-level visual representation and analysis of each task associated with a value stream. VSM is a macro-level leadership activity.

Pros, cons, and limitations of having a value stream map in place 

Value Stream Mapping is a powerful representation of understanding and collaboration in the following areas:

• The problem or concerns
• The current state of affairs
• The dream future state
• The value stream analysis
• A "We can and will do this" transformation opportunity list
• A scheduled retrospective of the leaders and teams involved in the value stream

5 benefits of Value Stream Mapping

VSM helps you answer questions like:

• Where are we wasting time, effort, and resources?
• How can we shorten the time to deliver something new or a fix?
• How can we improve the quality of what and how we work?
• How can the experiences of customers and staff be best satisfied?
• What does leadership need to know to assist in the removal of obstacles?
• What metrics should guide our efforts and renovation?

So, the benefits of having a value stream map in place can be resumed into:

1. Everyone focuses on the customer outcome - By creating a value stream map, you consider what the customer or staff will experience from a workflow and whether or not that’s the outcome you wanted.
2. Everyone has a shared language that allows individuals to prove the contribution and success of the introduced changes.
3. Value Stream Mapping also enables top-down collaboration and knowledge exchange.
4. It can quickly become a dashboard highlighting issues.
5. VSM removes the need to create elaborate business cases.

6 challenges of Value Stream Mapping

Some of the challenges of Value Stream Mapping could be:

1. Leadership time and willingness.
2. If not careful, VSM can create a silo or new obstacle.
3. Leaders must demonstrate that they own the work encompassing the value stream by not delegating VSM.
4. The language of “can't” or “won't” hinders innovation.
5. VSM is expensive in time to learn, perform and maintain and should be balanced against customer/staff satisfaction and organizational outcomes.
6. The tendency is to allow consultants to perform the VSM exercise and report to leadership. Leaders must take the time to do VSM or not do it in any form.

Value Stream Mapping and the 8 types of waste

Value Stream Mapping visually describes a problem and what is in the workstream to ensure a safe and steady flow of activities and data. So, it’s handy as an analysis technique to spot waste – of time, effort, and resources.

In this sense, technology's most significant waste is downtime. However, that’s not the only one. Lean manufacturing identifies eight types of waste:

1. Defects
2. Overproduction
3. Waiting
4. Non-utilization
5. Transportation
6. Inventory
7. Motion-waste
8. Employee skills or health

1. Defects

Defect waste management consists of the costs associated with accidents and imperfections that lead to defective products. Some examples could be errors, poor code, unstable IT, and untested items.

2. Overproduction

Overproduction waste management comes into play when there’s too much of a product or service. In IT, we can see this with feature creep or early delivery of items that cannot be used. It’s important to mention that overproduction can also lead to other forms of waste (for instance, with physical products, you’ll need to spend more on storage and have capital invested in useless inventory).

3. Waiting

As you may imagine, waiting for waste is when goods are not being transported or worked on. Some practical examples could be delays in delivery, approvals, or response; hand-offs to a team that’s not ready for your work; unneeded governance review (such as a committee or CAB); or a vendor issue.

4. Non-utilization

This VSM waste happens when there is partially completed work, redundant tools, forms, or processes.

5. Transportation

Transportation waste is caused when things are moved around excessively. Though very similar on the surface to motion waste, this is linked to forms being moved between departments, email exchanges, tightly coupled tasks, data transfer, etc.

6. Inventory

Inventory waste is linked to the second type of waste listed here. It consists of an overabundance of inventory, which causes greater lead times, increases the difficulty of identifying problems, and increases storage costs if we’re talking about a physical product. It is a problem seen with constant task-switching or when there are many items in a release.

7. Motion waste

Motion waste is mainly attributed to people. It refers to the cost of all the movement that requires an excessive amount of energy and could be minimized. In our industry, this can be seen when people have to move away from their tasks to attend meetings or places where they’re not needed.

8. Employee skills or health

Lastly, this VSM waste occurs when the team doesn’t have the necessary skills, training is done at the wrong time, or there’s a lack of leadership support. Other situations where this type of waste manifests is when the team is under too much stress, or it’s affected by poor communication or collaboration.

How to create a value stream map in 5 steps

Since Value Stream Mapping is a Kaizen event, in order to create a value stream map, first you need to have in mind the Kaizen methodology. 

Kaizen is a Japanese word that means “change (kai) for the better (zen),” and it has a highly structured format of collaboration. Leaders using this methodology must:

• Understand the current way of working
• Observe the obstacles and challenges in the workflow
• Create a dream future state 
• Craft the use-cases to achieve the future state (see example)
• Collaborate with staff to ensure their cooperation and understanding of WIIFM
• Generate and analyze the metrics that will guide the transformation
• Regularly (two weeks or less) review progress (no delegation or dependence on reports)

Based on this framework, the five basic steps to create a value stream map (with a focus on problem and improvement management) are:

1. Agree the workstream to be improved
2. Document the current state
3. Dream the future state
4. Plan the transformation
5. Collaborate on the VSM-Kaizen event

1. Agree with the workstream to be improved

The first step of a value stream map is to decide “why” and “who.” Here, you’ll need to answer questions like:

• Which customer – internal or external – will benefit from the workstream?
• What are the boundaries of the stream and the Kaizen event? (Examples of this could be no spending of money or hiring)
• What information and support will those involved require?
• What are the details of the event? (Who, dates, location, etc.)

2. Document the current state

Now, it’s time to analyze the current situation. To do this, place the customer at the top of your map to focus the discussion.

In this VSM step, it could be helpful to use post-it notes or a Value Stream Mapping tool to briefly document each task in the flow of work. Don’t forget to use noun-verb nomenclature and macro descriptions – and don’t use more than 15 post-it notes to map the entire stream!

Among the information, you need to gather for each task is lead time, actual time, quality of the step, people involved, data involved, forms created, tools used, vendors, mandatory meetings, and any other detail you need for your particular workstream.

Before you move on to the next step, walk through the current state physically and visually to ensure nothing of importance has been overlooked. And don’t forget that you don’t have to start improving things. This method demands a thorough understanding before implementation.

3. Dream of the future state

You’ve mapped the way things are, and now it’s time to agree on a dream of the future if there weren’t any obstacles. This is not what the value stream would look like if all the problems in the current state were resolved. 

To do this well, you must forget about the current state and go wild! Let your imagination create a new workstream of no more than 15 steps, add the same measures and information used in step 2, and walk the future stream to ensure customer/staff expected outcomes.

4. Plan the transformation

We’re slowly moving towards action. In this step of the value stream map, you’ll compare your reality (the workstream you built in Step 2) against the dream future (the workstream you created in Step 3).

With this comparison, start documenting actions that will allow you to achieve the future. State them all, and avoid attitudes of “can’t.”

A best practice here is to write each idea using the format:

• {Our service/product/process} was designed to achieve {these goals}. 
• We have observed that the service/product/process isn't meeting {these goals} which is causing {this adverse effect} business issue to our business. 
• How might we improve {service/product/process} so that our customers are more successful as determined by {these measurable criteria}?
• We will know we are on target by observing these changes (metrics of success)

5. Collaborate on the VSM-Kaizen event

Lastly, it’s time to show and tell. At this stage, transparently share all the charter, current, and future state maps, ideas of improvement, and how the transformation will be governed, sponsored, funded and rewarded.

Make sure you listen to your teams, including their feedback, adding their ideas, or tweaking the future. And then, start the change – and do so quickly and practically (for instance, cancel a meeting or stop a form the next day).

And regroup on a bi-weekly basis to explore what has changed, realign the future, confirm the following steps, and even stop completely to regroup and begin afresh if necessary.

VSM tips

If you decide to go with the Value Stream Mapping strategy, here are some extra tips for you to take into account:

• Know the boundaries of what you want to consider and achieve realistically.
• The charter is a powerful statement of commitment. Get it signed and shared to advertise leadership support.
• Value Stream Mapping is a visual management technique, including all documentation about the changes, issues, teams involved, and customer or staff impacts.
• Let all comment on the VSM activity as they might have a good idea.
• A strong facilitator capable of controlling and training the organization in VSM is highly recommended.

Value stream mapping symbols and automated tools

There are a plethora of value stream mapping symbols that can describe your value stream maps, such as: 

As a recommended best practice, try to limit the symbols you use on your streams, adding them only to improve the clarity of data, resource, or material flows. If you want to use VSM software, Tasktop, iGrafx, Plutora, Edraw, and Lucidchart have excellent VSM tools with symbols. And Miro has a free template upon which you can add customized logos or pictures of your design.

Value Stream Mapping metrics

Once your VSM map is in place, it’s time to measure its results. Value Stream Mapping has two primary metrics to aid the identification of wasteful activities: time and quality.

As of the time, Lean uses the term “Takt time” to define the frequency in which a task should occur to meet demand. Takt time measures:

• Lead Time – Elapsed time of a step in its entirety, including wait time or pauses.
• Actual Time – the time spent to perform a task, no interruption.
• The formula for Takt time (Lead and Actual):
• Time Available/Demand = if a shift is 8 hours and the demand is ten, then (8*60)/10 = the Takt beat of 48 minutes. Perfection is when Lead and Actual are equal.
• Service management incident management example:
• Step 1 is to complete a form, but you need to wait for information, so Lead = 30 minutes while Actual is just 4 minutes. You want a fast Takt time when possible.

Regarding quality, Karen Martin introduced a measure to help leaders appreciate why some tasks had deviation quality. To include this VSM metric in your process, beginning at step two, ascertain the quality or completeness of the previous step. Continue doing this until all actions have a measure.

Then, multiply the percentage together (for instance: 75% x 80% x 90% x 70% = 37.8%). This simple calculation will show you the quality of your value stream map. In the example, you could think it’s high-quality because of the completeness of each step, but in reality, when you look at it all together, the stream has low quality.

Lastly, other measures such as people involved, activity ratios, and several meetings are also helpful. They should be denoted on the value stream map and in the value stream analysis. 

The goal is to use measures as warning signals or guides. Too many meetings, forms, or tasks taking longer than anticipated are red flags. In service management or software delivery, the goal is to provide quality satisfaction. News sites full of this have been neglected and replaced with a go-fast culture.

Summary and key takeaways

Value Stream Mapping is an event whereby leaders can quickly review (3-4 days maximum) why a flow of work is not operating optimally based on customer and staff expectations. The mapping exercise encourages Value Stream Management by all involved in the workstream to make the dream future possible via minor, iterative step improvements. 

Though it requires a lot of hard work – especially from the managers' side – and it might take a bit of time to get a handle on it, it's an excellent method to analyze and improve process flow, and it can even become a dashboard to quickly spot and correct issues.

Due to its origins in the manufacturing industry, Value Stream Mapping is a valuable ally to identify and minimize waste, mainly in terms of time, effort, and resources.

This lean technique has been integrated with other ITSM frameworks - such as ITIL, DevOps, IT4IT, and Agile. So, if you're following any of these approaches, you'll be able to include it in your current workflow easily.

The leaders should sign a helpful document during this phase: the Value Stream Charter, per Karen Martin and Mike Osterling.