The path to a lean, digital value stream by Space Dreamer – 9 –

The path to a lean, digital value stream

Author : Mehmet Temel Aygün

The customer-individualized project business is formative for many companies in mechanical engineering. An exemplary analysis of the throughput times of orders of a manufacturer of customer-individualized machine components shows that the largest proportion of time goes towards development and parts procurement, followed by customer contact during project clarification and in the context of delivery and commissioning. The product only spends a small portion of time (4% in the example) in production. It can be assumed that a similar time distribution can be observed in many companies in the industry.

Today, the Value Stream Method is the standard in many companies that want to improve their product flow, reduce inventory, and decrease throughput times. The method’s focus is mostly on the parts and product flow from supplier to  customer. Information flows are essentially regarded from the perspective of production control and its improvement.

The extended Value Stream Method

If the objective, however, is to satisfy individualized customer requests quickly, flexibly, and,  at the same time, efficiently, only considering production, material flows, and the associated control information falls short. For this reason, in the following, the focus of the traditional Value Stream Method will be extended to all areas involved in order processing, including the customer. Furthermore, the information within the scope of this method will be considered from three new perspectives:

  • Waste in handling information
  • Use of information for process improvement
  • Use of information to increase customer value

A look at waste in handling information

Lean activities typically aim for eliminating transport, inventory, movement, waiting time, overproduction, over-fulfilling processes, and defects. These traditional types of waste provide support in the analysis of material flows and production itself, but they cannot be transferred directly to information flows. In order to holistically recognize wastes and potential in handling information, a new perspective is necessary. Following material logistics, the term information logistics is therefore introduced. For this, the goal is formulated to provide information at the right time, at the right place, in the right amount, and of the proper quality and ultimately to be used in a target-oriented manner. This should take place with as little waste as possible.

Within the scope of a Value Stream Analysis 4.0, eight types of waste in information logistics are introduced that emerge along the lifecycle of information and can be assigned to defined phases. A cycle consists of three phases:  

  • Data generation and transmission
  • Data processing and storage
  • Data usage

The individual types of waste in information logistics are clarified in the following by guiding questions. 

Phase of data generation  and data transmission

The goal during data generation and transmission is to make the desired data available in the proper quality. Wastes can occur in the:

Data selection

  • Has a purpose been designated?
  • Is clearly defined what the data will be used for?

Data quality

  • Do the frequency and level of detail of the collection fit with the intended use?
  • Has the data been collected and transmitted in a standardized manner?  

Data collection

  • Is the collection of data appropriate with regard to the costs and benefit?
  • Is the regular collection of data automated?

Data transmission

  • Does an interface-free communication of data take place?
  • Is the data stored centrally?

Phase of data processing and storage

Data and the resulting information should be processed continuously and without waiting time in order to be available for decisions or activities. Wastes can be:

Waiting times and inventory

  • Can an order not be processed because information is missing?
  • Is data and information available at exactly the right time?

Transport, movement and searching

  • Can employees find the required information without searching effort?
  • Is the presentation medium suitable?

Data usage

The data compacted into information is to be used purposefully, either for order processing, for the improvement of processes, or to increase to product’s value. product value The following wastes can arise:

Data analysis

  • Is the recorded data analyzed with appropriate methods?
  • Are these analyses used?

Decision-making support

  • Is the data verifiably used for decisions or improvement activities?
  • Is the information processed in accordance with its use? 

Value Stream Method 4.0 

Through the Value Stream Method 4.0, all product and information flows of a value stream are analyzed and designed.  It comprises the Value Stream Analysis 4.0 (VSA 4.0) and the alue Stream Design 4.0 (VSD 4.0). The approach extends across departments from the first customer contact all the way to the shipment of the product. The goal of the method is to develop all processes of a value stream in such a way that customer requests can be satisfied quickly, flexibly and thereby efficiently. The emphasis here is on the simultaneous consideration and synchronization of product and information flows.

Approach in three steps – an overview

Step A – Define added value

The starting point of the Value Stream Method 4.0 lies in obtaining a basic understanding of what generates customer value. This refines one’s awareness during the search for wastes

Step B – Analyze the current state

Within the scope of the traditional VSA, process data, inventory, and control information are recorded and so-called “Kaizen flashes” (improvement opportunities) are delineated. The scope of the VSA 4.0 is extended to the entire order-processing, begins with the first customer contact, and goes all the way until product usage. A detailed observation of the information flow follows during the order cycle. It targets wastes that emerge during the handling, transport and usage of data and information (so-called wastes in information logistics).   

Step C – Determine the future state

Only a fundamentally stable and, with regard to material flow, lean value stream should be digitally supported or digitally valorized. Therefore, the traditional VSD, with its design rules, continues to remain the first step to the digital target condition. The resulting value stream vision is improved through the targeted use of digitalization solutions in order to stabilize or expand the flow, or to eliminate process steps. The VSD 4.0 focuses on the integration of product flows and the necessary information flows as well as on elaborating a consistent implementation in  IT systems.

See you in next blog with the following topics :

  • Execution of the Value Stream Analysis 4.0


Kadıköy, İstanbul – TURKEY

M. Temel AYGÜN, Ph. D. in Aerospace Eng.

Copyright is Author’s.

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