Lesson 6 - Value Stream vs SIPOC

Process Maps: Lean Value Stream Map vs Six Sigma SIPOC

Example of Flow Chart

We live in a world of processes. There is no argument that if we follow a good process that, if we replicate it, an outcome is, certainly, predictable.  A good outcome.

LSS uses various forms of process maps.  Lean is associated with the Value Steam Map (or VSM), and Six Sigma uses the SIPOC paradigm.  The first diagram above is an example of a standard Flow
Chart that is universal and oftentimes used in determining a critical path.

This chapter will introduce and focus on the Value Stream Map and SIPOC.

Lean Enterprise can’t be what it is without a Value Stream.

Intimidating; but once learned, it’s a good tool. In manufacturing, it’s key in evaluating cycle times and meeting deadlines.

The following are the important elements:

• Value Added: Value added tasks are those actions that provide direct value to the customer. In the oil fields, we call it “boots on the ground” which means when actual work is done.
• Non-Value Added but Necessary (Muda 1): Non-value added but necessary tasks are those actions which are part of the work cycle that provides no value to the work cycle but is necessary to perform the job function. Some examples include drive time to and from a work site; setting up the equipment; meeting with the customer to go over the project at hand.
• Non Value Added (Muda 2): Non-value added tasks are those actions that are part of the work cycle that adds no benefit to the job at hand. Some examples include morning and afternoon breaks, lunch, and time needed to use the bathroom. Waste is anything that depletes valuable time away from the job that’s not covered above. Examples include: Not having the tools nor inventory to do the job requiring the crew to drive back to the shop; not parking at an ideal spot requiring crew members to take valuable time away to move to and from the work site; horsing around; experiencing fatigue due to not using the proper tools or methods to do the job properly; taking long breaks and lunches; the list goes on, and these types of waste costs the customer money and earns a negative grade from the customer.

Notice above I referenced the term "Muda".  In Lean, you'll hear it a lot and I'll briefly provide its reference.

TPS has a strong policy of level loading the work flow.  Through the TIMWOOD waste process, Ohno prefers workers do their tasks correctly first time, every time, thereby following the be a tortoise and not the hare.  The three M's: Mura, Muri and Muda respectively means (mura) uneven, not level, imbalance; (muri) friction, over processing, overworking; and, (muda) waste.  The thought pattern behind this explains that if an employee is working in an uneven and imbalance work environment (mura), it will cause friction, over processing and over exertion (muri) that will eventually result to waste (waste).  So as a start, the work environment must be "heijunka" or level and balanced.

Example of Value Stream Map

Regarding the Muda 1 and Muda 2 references above, as explained, Muda 1 is waste but needed to complete the task, such as setting up the work place.  Muda 2, however, adds absolutely no value and it takes time, space and energy, for example, lunch breaks and, of course, those examples outlined in TIMWOOD.

Ed Deming was instrumental in helping the Japanese post World War II build their manufacturing companies capacities, and in his 14 points helped relieve muda but instilling or building quality in every phase of the process instead of waiting to the very end when an inspector gives the stamp of approval. By having quality built in every station, it prevented tremendous waste, as each station considered the up stream station his/her "customer".

James Harrington from IBM wrote a book in the mid-1980’s called Poor Quality Costs that addresses what happens when a company doesn’t recognize waste and eliminates them. It’s not an easy read, but once you get through it, it opens up your eyes to some of the things that goes on that contribute to money wasted on a daily basis. He made Cost of Poor Quality or CoPQ one of the more powerful tools used in Lean Six Sigma.

What a value stream map provides is a tool along with the help of audits, time and motions studies and Takt time studies provide data that can reduce waste and provide more ‘boots on the ground” work.

SIPOC

• SIPOC is an acronym for:
• Supplier
• Inputs
• Process
• Outputs
• Customer

As a work process, it flows from left to right from a production standpoint. However, this acronym if spelled backwards COPIS is what companies used to determine what the customer wants, in Six Sigma, it would be looking for Critical to Quality (CTQ) or Critical to X (CTX) and have used the Voice of the Customer (VOC), Voice of the Business (VOB), Voice of the Employee (VOE) methods to capture key information regarding quality standards for the customer. If you recall the previous lesson Y(f)X, X in this case are independent factors that’s used in processing the output or Y.

As an example, see SIPOC below on how this fits in the process or critical pathway.

Supplier	Input	Process	Output	Customer
Company	Labor	Make widget	Product	Satisfied with it being delivered, perfectly, on time, hassle and defects free
Company	Work Infrastructure / equipment / tools.  On a final note, in some school that acronym FATIPO, which stands for Flow, Accuracy, Timeliness, Inputs, Process and Outputs, is used to combine both Lean and Six Sigma together in a concise and "Lean" way.