The Value Stream of the Effective Enterprise

One of the main tenets of Lean-Thinking is to attend to the work not the people. There are several reasons for this. These are:

  • our goal is lowering the cost of delay of what is being created. Looking at the value stream provides an overall view that cannot be achieved from looking at each step
  • to lower cost of delay we must lower the delays at the critical steps in the value streams. Delays are caused by hand-offs, interruptions and rework.  The causes of these cannot be seen by looking at any one step
  • many delays are caused by dependencies between different parts of the value stream
  • focusing on people leads to local optimization both directly and by rewarding people for being locally optimized

Another tenet of Lean is that we trust and respect our people. Therefore, micro-managing them shouldn’t be needed in the first place.

A depiction of the value stream of the effective enterprise is shown in figure 1.

Figure 1: The Value Stream of an Effective Enterprise

Figure 1 depicts the steps work goes through from concept to realization. It does intend to suggest that the work done is linear. To simplify the main concepts, it has intentionally left out feedback loops and places where work is done in parallel and then re-converges. The replicated streams in the middle of the diagram illustrate how several value streams can exist in parallel.

Two new roles are also presented – the value stream network architect and the business architect. Both of these will be described in their context. First, I’ll go through each of the five major “steps” in the picture.

To learn more about value stream mapping, see Mapping Your Value Stream in Part III.