Value Stream Mapping: Why it should be your first step to define your strategy

VSM : The key to aligning your processes and goals

Value stream mapping is a powerful technique to visualize the flow of work and identify the sources of waste and inefficiency in any process. By designing value stream maps, you can align your leadership and teams around a common vision of how to deliver value to your customers faster and better.

Start with the customer. What is the product or service that they want from you? How do you deliver it to them? Define the boundaries of your value stream, from the first input to the final output.
Focus on value. What are the activities that directly create value for the customer? These are the ones that transform the input into the output, such as making, assembling, or testing. Eliminate any steps that do not add value, such as waiting, moving, or storing.
Measure your performance. How well are you meeting the customer’s needs and expectations? Collect data on key indicators of your process, such as how long it takes, how much it costs, how much you produce, how many errors you make, and how satisfied your customers are.
Envision the ideal state. How can you make your process faster, cheaper, better, and easier? Think of ways to eliminate or minimize waste, such as producing only what is needed, reducing transportation and motion, keeping inventory low, preventing defects, and simplifying tasks.
Implement and improve. Put your plan into action and monitor the results. Compare your current state with your future state and see if you have achieved your goals. If not, identify the root causes of the problems and make adjustments. Keep learning and improving until you reach excellence.

A value stream is a high-level view that shows the value-adding and non-value-adding activities, as well as the waiting times and information flows between them while a process is a low-level view that shows the detailed steps and tasks that are involved in each activity.

With a VSM in place, organizations can establish key performance indicators (KPIs) at various stages of the value stream. These KPIs can be used to measure performance against strategic objectives and identify areas that require attention or course correction.

Transformative VSM Success Stories

In healthcare, a hospital’s VSM initiative cut patient stays by 37%, boosted satisfaction by 50%, and saved $1.2 million annually.
In manufacturing, a furniture company optimized wood panel production, eliminating waste and enhancing quality and efficiency.
In IT, a software company streamlined feature delivery, elevating speed, satisfaction, and cost-effectiveness.

Step 1. Craft a clear and inspiring corporate vision

A corporate vision is a statement that describes the long-term goals and aspirations of a company. It serves as a guide for the company’s direction, strategy, and culture. A corporate vision should be clear, concise, inspiring, and realistic.

Think about the future. What is the future that you want to create ? A vision statement is not a target date, it’s a destination you want to reach in the long term.
Know your goals. Where do you want to go?
Consider your values. How you want to make a positive impact ?
Build on your mission statement. What do you do and how you will achieve your goals in the long run ? Keep it simple, easy to understand and remember. Don’t be too generic.

Examples of visions :

IKEA: To create a better everyday life for the many people.
L’Oréal: To offer all women and men worldwide the best of cosmetics innovation in terms of quality, efficacy and safety.
LEGO: To inspire and develop the builders of tomorrow
Zalando: To be the starting point for fashion
Airbnb: To create a world where anyone can belong anywhere.
Netflix: To entertain the world with TV shows and movies across a wide variety of genres and languages.
LVMH : To represent the most refined qualities of Western “Art de Vivre” around the world. LVMH must continue to be synonymous with both elegance and creativity.

Step 2. Identify and eliminate waste in your strategy

Set Up the A3 Page:
Start with an A3-sized landscape-oriented sheet of paper. Draw a large rectangle in the center of the page, leaving some space around the edges for labels and annotations. This rectangle will represent your value stream.
- Why A3 ? The A3 approach is a structured problem-solving and communication tool that condenses complex issues onto a single A3-sized sheet of paper, fostering collaboration, standardizing problem-solving processes, and promoting visual clarity in lean management.
Define the Value Stream Boundaries:
- At the top of the rectangle, write the name of the value stream or process you’re mapping.
  On the left side of the rectangle, label it as “Start” to indicate the starting point of the value stream ; typically the customer or demand trigger.
  Label the right side of the rectangle as “End” to signify the endpoint of the value stream and information like performance or quality metrics, Customer Satisfaction.
  At the bottom of the page, include any additional information or metrics relevant to the value stream.
Map the Process Flow:
Within the rectangle, create a sequence of rectangles or boxes to represent each step or process within the value stream. Connect these boxes with arrows to show the flow of the process from start to finish. Label each box with a brief description of the process step.
OKR, KPIs : Quantify key metrics
Alongside the process steps, include key metrics such as cycle time, lead time, and the number of items in each process step.
Future State: If space allows, use a different color or a dashed outline to indicate the future state of the value stream, highlighting planned improvements.
- Highlight Problems and Opportunities : Use symbols to mark areas of waste, bottlenecks, or other problems within the value stream. Annotate these areas briefly to describe the issues.

Enhancing agility through cross-functional collaboration

Value Stream Mapping engages cross-functional teams, fostering essential collaboration and offering a comprehensive perspective of processes.

This collaboration plays a pivotal role in agile decision-making and problem-solving by harnessing diverse viewpoints. As organizations continuously monitor and enhance their value streams, they bolster their ability to adapt and respond to shifting business landscapes, competitive pressures, and evolving customer expectations, fundamental attributes of agility.

VSM, as a tool for continuous improvement, hinges on data collection and analysis, empowering data-driven decision-making in the execution of strategic initiatives and agility efforts.

This systematic approach encourages organizations to consistently assess and optimize their processes in alignment with strategic objectives, ensuring flexibility and responsiveness to dynamic conditions.

Data serves as the bedrock for making informed and strategic adjustments.

In summary, Unlocking efficiency and alignment: The power of Value Stream Mapping & Strategic Vision

Setting up a VSM for strategy and agility is crucial because it aligns processes with strategic goals, identifies improvement opportunities, enhances customer focus, fosters collaboration, and provides a structured approach to adaptability and continuous improvement, key elements for success in today’s rapidly changing business landscape.

VSM (Value Stream Mapping) is a powerful technique for visualizing work processes and identifying waste and inefficiencies.
It aligns leadership and teams around a common vision of delivering value to customers efficiently.
The process starts with defining customer needs and boundaries.
Focus is on identifying and eliminating non-value-adding activities and waste.
Measurement of key performance indicators (KPIs) is crucial.
The ideal state is envisioned to make processes faster, cheaper, better, and easier.
Continuous improvement is at the core of VSM, relying on data-driven decision-making.
VSM fosters cross-functional collaboration, enhancing agility.
Case studies in healthcare, manufacturing, and IT demonstrate the transformative power of VSM.
Setting a clear corporate vision is crucial for strategic alignment.
Identifying and eliminating waste in strategy is essential for efficiency.
Using A3 methodology for problem-solving promotes clarity and collaboration.

“It’s the process of value stream mapping rather than the maps themselves that carries the greatest power by installing transformational mindsets and behaviors into the DNA of an organization.”
Karen Martin