IJRME - International Journal of Research in Mechanical Engineering ISSN: 2349-3860

IMPROVE THE FLOW OF INVENTORY AND

INFORMATION BY USING VALUE STREAM
MAPPING TO ACHIEVE A COST SAVING IN AN
INDUSTRY
Krishna Chandra Mishra1
1
(Department of Mechanical Engineering, Assistant Professor, DSITM, GHAZIABAD (UP) India)
___________________________________________________________________________________________________

Abstract—Studies on applications of lean in a continuous process industry are limited. There is lot of opportunities for improvement
in the process industries. If lean tools are utilized This paper addresses the application of Value Stream Mapping as one of the Lean
tools to eliminate waste, and improved operational procedures and productivity. Current state map is prepared and analyzed and
suggested to improve the operational process. Accordingly the future state map is drawn. The study reveals that there is an improvement
in the tact time by implementing the proposed changes if incorporated in the future state map. A value stream map takes into account not
only the activity of the product, but the management and information systems that support the basic process. This is especially helpful
when working to reduce cycle time, because you gain insight into the decision making flow in addition to the process flow. It is actually a
Lean tool. Studies on applications of lean in a continuous process industry are limited. There is lot of opportunities for improvement in
the process industries.

Keywords—Value Stream Mapping; Lean Manufacturing; Current State Map; Future State Map
______________________________________________________________________________________________________________

1. INTRODUCTION mapping is to highlight sources of waste and eliminate

them by implementing the future-state value stream that
A value stream mapping is a lean enterprise technique used
can become a reality. The goal is to build a chain of
to document, analyze and improve the flow of information
production where the individual processes are linked to
or materials required to produce a product or service for a
their customer(s) either by continuous flow or pull, and
customer. A value stream is all the actions, both value
each process gets as close as possible to producing only
added and non-value added, currently required to complete
when the customers need it.
a product or service from beginning to end. Value stream
mapping is a lean manufacturing or lean enterprise 2. LITERATURE REVIEW
technique used to document, analyze and improve the flow
1. Balkema and Rotterdam (2004) have created
of information or materials required to produce a product
current state map for a steel producer, a steel service center
or service for a customer. Value stream mapping is a paper
and first-tier component supplier. The current state map
and pencil tool that helps you to see and understand the
identifies huge piled of inventory and long lead-time. In the
flow of material and information as a product or service
future state map target areas were subjected to different
makes its way through the value stream. Value stream
lean tools including kanban, supermarket, and continuous
mapping is typically used in Lean, A value stream map
flow.
takes into account not only the activity of the product, but
2. Ballard and Howell (1994) suggest that, the value
the management and information systems that support the
Stream mapping can serve as a good starting point for any
basic process. This is especially helpful when working to
enterprise that wants to be lean. It provides a common
reduce cycle time, because you gain insight into the
language for talking about manufacturing process. It ties
decision making flow in addition to the process flow. It is
together lean concepts and techniques which help to avoid
actually a Lean tool.
"cherry picking". It forms the basis for an implementation
plan by helping to design the whole flow.
VSM is the process of visually mapping the flow of
information and material as they are preparing a future
3. Halpan and Kueckmann (2001) explain value
state map with better methods and performance. It helps to
Stream mapping in aircraft manufacturing. They draw
visualize the station cycle times, inventory at each stage,
current and future state maps were developed with the
manpower and information flow across the supply chain.
objective of reducing lead time according to customer
VSM enables a company to ‘see’ the entire process in both
requirements. The implementation of the future state map
its current and desired future state, which develop the road
attained lead-time reduction.
map that prioritizes the projects or tasks to bridge the gap
between the current state and the future state. The value
4. Summer, 1998 has described Activity Based
stream mapping is used to analyze & map in order to
Costing (ABC), identify various cost components and
reduce the waste in processes, enable flow, and to make the
analyze the relative contribution to the total cost. The
process for better efficiency. The purpose of value stream
essence of ABC is that, product consumes activity, activity

IJRME - International Journal of Research in Mechanical Engineering

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 IJRME - International Journal of Research in Mechanical Engineering ISSN: 2349-3860

consumes resource and resources generate cost. Thus it is waste, thereby streamlining work processes, cutting lead
necessary to develop the relationship between activity, times, reducing costs and increasing quality and hence
coast drivers and activity measures. Target costing is to productivity. The goal of VSM is to identify, demonstrate
anticipate the acceptable market price through intensive and decrease waste in the process, highlighting the
customer focus. Design and manufacturing team’s allies to opportunities for improvement that will most significantly
bring the product within the target cost. Target cost is the impact the overall production system. In this study lean
cost that can be incurred while still earning the desired concepts are introduced using VSM in working
benefit. The objective of the present work is to demonstrate environment.
how a manufacturing system operates with timing of step- In brief the main objective of paper :
by step activities. • Improve the flow of inventory and information by
value-stream mapping
5. New (1993), and Jones et.al (1997) and other • Draw a current-state map
Researchers developed individual tools to understand the • Identify major lean concepts
value stream. VSM extends guidance for improvements in • Draw a future-state map
the process, identifies the need to improve workflow and • Develop a basic implementation plan
finally shows avenues to reduce waste. Shingo (1989) has
discussed the strategies for the effective implementation of 4. VSM METHODOLOGY
Value Stream Mapping in a wood industry. He also opines To start improving productivity by identifying waste and
that loops can be formed to identify the similar processes then removing it by implementing lean principle in the
and these loops will be helpful in identifying the non-value industry there is no other tool better than VSM. The Value
activities in a systematic manner. He has suggested the Stream Mapping method (VSM) is a visualization tool
ways to eliminate non value added activity and proposed oriented to the Toyota version of Lean Manufacturing
measures to increase the Value added ratio. (Toyota Production System). It helps to understand and
3. RESEARCH OBJECTIVE streamline work processes using the tools and techniques
of Lean Manufacturing. The goal of VSM is to identify,
Today, automotive suppliers have a great concern over demonstrate and decrease waste in the process. Waste
improving quality and delivery and decreasing cost, which being any activity that does not add value to the final
leads to improved system productivity. In order to remain product, often used to demonstrate and decrease the
competitive, waste from the value stream must be amount of `waste' in a manufacturing system. VSM can
identified and eliminated so to run system with maximum thus serve as a blue print for Lean Manufacturing. This
efficiencies. section presents a methodology to develop a value stream
mapping to identify material and information of current
A Production is to order and large numbers of different state. Generally VSM has four major steps as given by
products are produced, each in relatively small volume. A Rother and Shook (1996):
Production shop consists of number of machine centres, • Product
each with a fundamentally different activity. The problems • Drawing current state
of machine shop are delayed deliveries, long queues, and
• Drawing future state
high work in process inventories, improper utilization.
• Develop work plan for implementation of future
These problems increase overall cost of production. The
state.
need for customized products/parts with reduced lead times
together with the requirement of global competitiveness
requires that products/parts be produced in small batch
sizes as per customer's requirement. The processing in
small batch sizes necessitates the adjustment in the flow of
production through different processes as per their
processing speeds. In addition it requires close monitoring
of processes to reduce process variability (defect free
production), efficient planned maintenance of all machines
(for increased availability) and reduction in non-value
added activities such as setup times, movement of material Within a warehouse, the first important step to carry out
in between the work processes and additional processing of when developing a value stream map is to identify the
material. The efficient utilization of machines while product or product family (group of products that pass
producing in small batches reduced WIP inventories, through similar processes and use common equipment and
reduced throughput times and reduction in lead times leads resources) you would like to improve. When creating a
to competitive manufacturing. It is need for machine shop value stream map, it’s crucial to focus on one product
manufacturing system to adopt lean environment. family at a time. The rule of thumb is to create maps for the
products with highest volumes first. Value stream mapping
To improve productivity by identifying waste and then for one product family usually takes about two days.
removing that by implementing lean principle in this Identify the current flow
industry we focus our attention on VSM tool. Value Stream
Mapping enables a company to identify and eliminate
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 IJRME - International Journal of Research in Mechanical Engineering ISSN: 2349-3860

Once you’ve defined the scope, the next step is to create a • So the customer can pull
“current state map,” or a visual representation of how the • As you manage toward perfection
process (or processes) in the warehouse are operating at the
present moment. Current state mapping begins with
understanding customer requirements. Key data points
such as units per month, shipping frequency/schedules,
hours of operations (available time), number of shifts
worked, or any pertinent information around customer
demand should be gathered before beginning the current
state map.
Observe and confirm processes
The mapping then begins by going to the warehouse floor Step1. Select your sponsor and set expectations
to observe processes firsthand. In fact, going to the place Appoint someone who is responsible to make decisions,
where the work happens is critical to having an accurate arbitrate solutions, and plan the project. The sponsor
current state map. To do this, the value stream mapping usually selects the processes that will be mapped and will
team typically starts the value stream walk at the end of the usually have a firm grasp of what achievement is being
process, with the last process closest to the customer. In a targeted.
warehouse, this may be the shipping/outbound loading Step2. Select your team
process. The team would then walk back up the value You should ensure that each area or stakeholder of the
stream, observing the steps to each process, until reaching process is represented e.g. Sales, Purchasing, Warehouse
the process where the product comes into the warehouse etc.
(i.e. receiving). Step3. Select process to be mapped
Map the flow or stream Value Stream Mapping is suitable for most businesses and
After discussing what has been observed, the team would can be used in Manufacturing, Logistics, Supply Chain and
then immediately begin to draw out the basic product flow. some Service orientated Organizations.
This is typically done on the wall using large sheets of Step4. Collect data and produce current state map
paper or a drawing board, filling in data boxes below each Process times, inventory or materials information,
process (cycle times, number of operators, defect and customer (or demand) requirements. The future state maps
quality data, etc.), placing inventory numbers in between will be developed using information captured here so it’s
each process to understand the amount of work in process, imperative you have a correct understanding of the
and mapping the information flow (the systems and business.
communications that authorize production at each process Step5. Critique Current state
step). Identification of the process is important to fully Challenge the current thinking, encourage your team to
understand where bottlenecks may occur or efficiencies can make suggestions, look for areas of waste.
be implemented. Step6. Map Future State
Creating the Implementation Plan Compile a future state map based on the current state map
The most important and final step of the value stream and the critiques.
mapping process is the creation of the implementation plan Step7. Create Action Plan and deploy
to achieve the future state. You create this plan by dividing Taking the Future State map consider an action plan that
your value stream map into manageable pieces that will could be implemented to change the current process to the
allow the team to accomplish improvements in a short future state.
period of time. Typically, the implementation plan is split Step8. Measure benefits
into three phases: 30-60 day improvements, 90-180 day Check to ensure that the benefits expected have been
improvements, and 360-day improvements. The team obtained – review each change made and analyze benefits.
should prioritize the plan to get the majority of the
improvements implemented within one year. After the one- 6. CONCLUSION:
year plan has been implemented, the future state becomes Modern managers find it difficult to identify the key areas
the current state for the following year and value stream and practices, which can be used to eliminate waste in their
mapping activities are conducted again to achieve processes. Based on the practical validation conducted, it
continuous improvement to the value stream on an annual can be seen that VSM can be effectively applied to apparel
basis. It’s important to remember that value stream industry as the initial step of waste identification. Using
mapping is only a tool. Unless you achieve the future state, this tool, it is possible to map the current status and
the team’s effort of creating the value stream map is subsequently analyze to achieve waste elimination.
worthless and creates no value for your organization or the
customers’ that receive your product or service. This paper shown that the wastes such as transport,
inventory and defects can be reduced which in turn
5. VALUE STREAM MAPPING STEPS improves the productivity of the organization. In order to
• Specify value from the standpoint of end customer accomplish this task, the managers of the case company
• Identify the value stream for each product family have to implement approaches like 5S, one piece flow,
• Make the product flow Cellular manufacturing etc. Thus, VSM helps the managers
to visualize the present level of wastes occurring in the
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 IJRME - International Journal of Research in Mechanical Engineering ISSN: 2349-3860

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