Enable Tomorrow’s Vision with Value Stream Mapping
How to leverage Value Stream Maps (VSMs) to optimize business performance and enable strategic goals toward a defined future state.
By Rebecca Mears & Crystal Young, BAS Senior Consultants
Is your organization focused and aligned on the priorities that will fulfill your future state business strategy and customer needs?
We have all heard it 1,000 times and live it every day — the only thing that is constant is change. In an ever-shifting environment, business needs and the value we provide to our customers must also evolve. Many of our processes and systems are built for the problems of yesterday — not the problems of today or tomorrow.
Value Stream Mapping (VSM) is a powerful tool used to understand the current state, identify opportunities, and improve business performance by focusing on alignment with business strategy and delivering customer value — today and in the future. Value Stream Mapping — compels teams to “think lean” based on the most important principle: understanding and delivering customer needs. The purpose is to:
- Develop a common understanding of the current process
- Determine a baseline to measure improvements against
- Define a vision of the future
- Align to strategic objectives
Develop a roadmap to support the transition to the future state
Value stream maps measure the rate of business value delivery. The “map” is presented in a simplified step-by-step language that both business and technical teams can understand. The flow measures process efficiency and opportunity. Value stream maps can be applied across all business functions — we have seen this approach improve IT delivery teams by 40%.
What are the key steps to developing a VSM?
A VSM is connected by the customer and integrated across all functions and operations that deliver value. Below are four key components that are essential to developing a VSM:
- Defined scope: At the highest level, a clear definition of what is in and out of scope for a value stream map activity. Scope begins with the input to the process and ends with value delivered to a customer. VSM scoping can be as broad or focused as needed.
- Stakeholders: Value Stream Mapping is a group approach that includes everyone who contributes to the process, regardless of their role or position in the organization. A VSM cannot be successful without insight from leadership and impacted teams.
- For current state VSMs: Identifying how a product or service is delivered can be very complex. Building the current state focuses on what actually happens today (not what is supposed to happen in theory or best practice) according to the subject matter experts.
- For future state VSMs: The future state process recognizes and continuously seeks to understand the customer needs to enable the business strategy. It focuses on how the future state should look in support of the future state vision and creating value for customers.
Participating in a Value Stream Map exercise
There are many ways to approach a VSM effort. Below are two examples depending on level of time and investment desired. These are for example only and individual business needs will vary.
- One-day workshop focusing on processes smaller in scope and handoffs, identifying and implementing incremental areas of improvement that will drive long-term growth, identify efficiencies, and add value.
- One–month deep dive evaluating opportunities across multiple operational areas with strategic alignment and roadmap planning
These can be facilitated virtually and adapted to meet the unique needs of any business.
Example Engagements
How to identify, size and prioritize opportunities
When the team has created their current state VSMs, they will identify opportunities in the process where value can be created or efficiencies gained. The opportunities are then evaluated against strategic goals for prioritization and roadmap planning. After the team has aligned and sized key priorities, a future state VSM is created to measure the improvement.
Sizing to understand value-add of each opportunity can be as simple or complex as needed. A simple and agile approach leverages a 2X2 Impact-Effort Grid enabled by consensus-driven decision making on where to place each opportunity. The output of this translates easily into a Continuous Improvement Roadmap focusing on High Impact-Low Effort items first, and then agreeing on what comes next in terms of High Impact-High Effort and Low Impact-Low Effort (Low Impact-High Effort should rarely if ever be worked on).
Creating a Continuous Improvement Roadmap
The outputs of the priority planning are then used to create a final roadmap of continuous improvement opportunities.
Some key considerations:
- Strategy — Which efforts best support the strategic goals?
- Customer Needs — Which efforts provide value to the end customer?
- Legal & Compliance — Which efforts does the business need to do to satisfy legal and compliance requirements?
- Areas of focus — Where will the company invest their efforts and funds?
- Capabilities & Technology: Does the company currently have the skills and tools necessary to achieve their desired improvements and future goals? If not, how will that expertise or systems be acquired / implemented?
- Timing: When do you expect to see results? Should improvement efforts run in parallel or in sequence? Consider immediate (< 30 days), short-term (30–60 days) and long term (>60 days) goals.
- Sustainment: How will improvement efforts be measured maintained overtime?
A continuous improvement strategy supports the long-term customer relationship and enables key customer insights essential for closed loop feedback needed to drive innovation, growth, and value.
Leveraging VSM to develop and embed a continuous improvement culture in your team will increase your ability to satisfy customers and drive long-term value necessary to meet strategic goals and objectives. We all understand the need for evolving our businesses in today’s climate, but how this is accomplished eludes many organizations. Let us at Slalom partner with you to help guide your leaders and organization towards tomorrow’s future.
Want to learn more?
Reach out to Slalom Orange County Business Advisory Services at slalomocbas@slalom.com — or visit slalom.com.
Slalom is a modern consulting firm focused on strategy, technology and business transformation. Learn more and reach out today.
