October 8, 2024
Today’s companies must promote operational efficiency to achieve the innovations needed to maintain a competitive edge. Value stream mapping and value stream management (VSM) are two important but distinct strategies that organizations can leverage to drive continuous improvement and deliver customer value more effectively.
Value stream mapping is about identifying inefficiencies in processes, while VSM is about optimizing the entire flow of processes from ideation to customer feedback.
Although the two strategies are different and have their own benefits, both value stream mapping and value stream management are crucial for business success because they improve workflows and increase customer satisfaction, two key goals in today’s fast-paced business environment.
What Is Value Stream Mapping?
Value stream mapping is the process of looking at how your company produces something end-to-end and mapping that out. With value stream mapping, you map all the processes in production and delivery to attain a real-time view of how all the products and services you are creating go through workflows.
When developing software, you need to understand how processes flow and how to improve that flow. Value stream mapping measures time and effort so you can understand the flow of information and materials across your organization.
Value stream mapping is a visualization tool used to analyze and identify inefficiencies in a company's processes. With the map, you can look for non-value-added activities and find areas for continuous improvement. The map shows where materials or requirements can flow better to increase efficiency.
Value stream mapping can be used for process optimization in manufacturing, software development, or service industries.
Benefits of Value Stream Mapping
Eliminating Waste
Value stream mapping benefits companies by identifying waste to improve efficiency. For example, value stream mapping can uncover unnecessary steps, eliminating time wasted between production stages. Value stream mapping promotes lean manufacturing principles by identifying waste, such as waiting times, excess inventory, and unnecessary movement of parts or materials.
Improving Efficiency
Value stream mapping assists lean manufacturing in optimizing production flows by ensuring that each step adds value to the final product. Eliminating steps that don’t add value, reducing lead times, and streamlining operations improve overall efficiency.
Promoting Continuous Improvement
The process of visualization in value stream mapping highlights bottlenecks and redundancies that might slow a process down, allowing them to be eliminated as part of continuous improvement.
Identifying Automation Opportunities
Value stream mapping can also identify opportunities for automation that can speed up operations. When value stream mapping uncovers steps that waste time and effort, these steps can be removed and automated.
Defining Value Stream Management
When looking at value streams, the important part is how your company manages them. Value stream management is understanding and being able to track everything going through your organization, from having an idea to delivering customer value. VSM not only manages every step along the process but helps you understand how the people are working together so you can eliminate silos.
VSM brings together the data in your organization so that you have a strong stream of information from tracking your value management strategy. This information can be broken down into six or three-month chunks and 2-week sprints for the purposes of continuous improvement. This data can then be rolled back up into your strategies. Companies that are not tying data and strategy together cannot compete in their market if other companies excel at VSM.
Value Stream Management goes beyond mapping value streams to encompass the entire process from ideation to delivery and customer feedback. VSM involves not just visualizing but managing the end-to-end process in real-time.
Key Benefits of VSM
Companies that use VSM can raise their status in the market. Streamlining processes, pulling data and strategy together, and seeing the reality of what is going on in your organization is important today to stay competitive.
Increased Visibility
VSM provides visibility into all workflow stages by continuously tracking the progress of a product from inception to delivery in sectors such as software development. For a software company, VSM manages the complete development lifecycle, including code integration, testing, and deployment.
Lifecycle Tracking
VSM tracks each stage of software development. Code integration ensures that developers’ code changes are integrated smoothly into the main project without introducing errors. Automated or manual testing can be carried out to check for bugs or quality issues. With VSM, a quality product or feature is delivered to customers or end-users through deployment.
Eliminating Silos
VSM ties people, processes, and technology together, breaking down organizational silos. With VSM, every team across the business has access to the same information and can align their goals with the mission of increasing value for customers.
Improved Customer Satisfaction
VSM helps improve customer satisfaction with products and services by getting products to market more quickly and cleanly.
Key Differences Between Value Stream Mapping and Value Stream Management
While value stream mapping and value stream management share the overarching goal of improving customer value, they have key differences, including:
Scope
Value stream mapping focuses on identifying inefficiencies within a specific process, while VSM oversees the entire value delivery system, from the idea to the customer experience upon delivery.
Tools & Technology
Value Stream Mapping often relies on traditional tools like flowcharts or diagrams. Value Stream Management incorporates more advanced, real-time tools, such as platforms, dashboards, and analytics, to monitor flow and performance.
Use Cases
A company might use value stream mapping to refine its product development process and then employ value stream management to track how each new feature impacts customer satisfaction.
End Goal
Value stream mapping aims to identify waste and optimize specific steps, while value stream management uses continuous tracking and adaptation to focus on delivering value.
Benefits of Integrating Value Stream Mapping and VSM
Value stream mapping and value stream management must be integrated to derive the most value from business processes. When you’re managing value streams, you can look at the value stream map to find where you can improve and be more efficient. The key to effective VSM is having a good value stream map and being able to measure key performance indicators (KPIs).
Some of the benefits of integrating value stream mapping and management are:
Holistic Efficiency
By using both value stream mapping and VSM, companies can continuously improve specific processes while also managing overall workflow efficiency. Understanding how things flow through the value stream map helps you determine whether teams need to use Kanban or Scrum as agile methodologies for achieving continuous improvement for workflows.
Enhanced Collaboration
Value stream management can eliminate departmental silos, allowing for greater communication and alignment, while mapping helps each department optimize its specific workflow. With the value stream map, you can see how to set up your teams and how to align your value streams.
Improved Customer Outcomes
With the combined use of both strategies, businesses can quickly respond to feedback and adapt their value streams to meet customer needs faster and more effectively. For example, a software company can map its internal development processes to cut waste and then use VSM to ensure those improvements align with customer feedback and expectations.
How to Benefit From Value Stream Mapping and Management
Value stream management can use value stream mapping in all kinds of ways to understand how effectively a company is developing software. For example, companies that want to improve release cycles can map value streams to find out where time and effort was being wasted. By removing and automating non-value-added steps, they can become more efficient, bringing software products and features to market more quickly.
To learn more about optimizing your business processes through value stream mapping and VSM, we encourage you to check out our website for all the resources and advice your organization needs.
About ValueOps by Broadcom
ValueOps® by Broadcom is the industry’s most complete Value Stream Management (VSM) solution. Combining robust business planning, agile delivery management, and value stream integration in one solution, ValueOps uniquely accelerates digital transformation by improving visibility, alignment, and efficiency at every stage of value creation.
With ValueOps, the seamless convergence of Clarity™, Rally®, ValueOps ConnectALL®, and ValueOps Insights in one solution empowers leaders at every level to plan, fund, manage, track, and optimize their work efforts using a common data model and value orientation. With the widest range of VSM features in the category, ValueOps has capabilities and insights to meet the needs of everyone in a value stream – effortlessly synchronizing them to align strategy, investments, people, and work across the enterprise. Broadcom.com/value
About Broadcom
Broadcom Inc. (NASDAQ: AVGO) is a global technology leader that designs, develops, and supplies a broad range of semiconductor and infrastructure software solutions. Broadcom’s category-leading product portfolio serves critical markets, including data center, networking, enterprise software, broadband, wireless, storage, and industrial. Our solutions include data center networking and storage, enterprise, mainframe, and cybersecurity software focused on automation, monitoring and security, smartphone components, telecoms, and factory automation. For more information, go to www.broadcom.com
Learn how to find the right VSM tools for accelerating digital transformation by reading the 2024 Buyer’s Guide for Value Stream Management. Access your copy here.