Enterprise-wide Value Stream Mapping: From Dysfunctional Organization to

Cross-Functional, Collaborative Learning and Improvement

D. J. Powell1,2, C. P. F. Bartolome2
1
SINTEF Manufacturing AS, Horten, Norway
2
Norwegian University of Science and Technology, Trondheim, Norway
([email protected])

Abstract - A value stream is defined as the set of all the this is that companies attempting to replicate Toyota
specific actions required to bring a product through the Motor Company's success often limit their efforts solely
three critical management tasks of any business: the to the implementation of shop floor best practices.
problem-solving task, the information management task, As such, VSM has become one of the default tools for
and the physical transformation task. However, a headlong
organizations embarking on a lean journey. Spawning
rush into adopting lean tools and techniques on the shop
floor has resulted in the improvement of the information
from what is referred to as Big Picture Mapping or
management and physical transformation tasks only, and Material and Information Flow Mapping at Toyota, VSM
has led many organizations towards a state of static process was popularized in the book Learning to See [3], which
optimization rather than one of sustained lean growth. In unfortunately covers only the “door-to-door” production
this paper, we draw on practical insights from a multiple- flow inside a plant. Though this is perhaps a good level at
firm action research initiative in two companies to present which to begin a “mapping and lean implementation
an alternative method for value stream mapping that also effort”, many companies neglect to scale up their efforts
incorporates the problem-solving task. This technique has in order to see value streams across the entire enterprise,
allowed the organizations to achieve not only sustainable
focusing simply on value analysis (to solve delivery
improvement in operational performance, but also
significant growth in people productivity. What emerged
problems in the existing production system) and
was a product-centric approach to cross-functional learning disregarding value engineering (solving deeper
and improvement, which has implications for both lean engineering problems to improve the designs of existing
theory and practice. and future products to better fit both the capabilities of the
production system (e.g. design for assembly, design for
Keywords - Lean Production, Value Stream manufacturing) and the needs of the customer) [4]. For
Management, Continuous Improvement example, more recently, [5] highlighted the Toyota
Product Development System (TPDS) as the key to
Toyota’s success, suggesting that an overemphasis on
I. INTRODUCTION Toyota Production System (TPS) alone has resulted in
many failed lean transformations in the West. [5] presents
Lean Production was popularized as an alternative TPS as an “efficient duplication system” and indicates that
approach to production management in the 1990s. In The it is in fact a combination of the Shusa (Chief Engineer)
Machine that Changed the World [1], the Lean Production System, the concept paper, and the Obeya management
paradigm was presented as five parts of an holistic system in the product development process that is the real
system: Dealing with the customer, designing the car, secret behind the success of Toyota – through deeply
running the factory, coordinating the supply chain and understanding the needs of the customer and thereby
managing the enterprise. This means that Lean creating constancy of purpose and cross-functional clarity
Production is a system. One cannot simply cherry-pick and alignment throughout the enterprise.
parts of it, but must rather build the integrated system of [6] reframes the original lean ideal as a Lean Strategy,
product-, process-, people-, and partner (supplier) consisting four integral parts: Higher customer
development. However, Lean Production has in many satisfaction, better products, improved production
instances simply been reduced to something just for processes and tighter supplier integration. [7] also
factory operations and shop floor management. presents a Lean Product-Process Development (PPD)
Though many companies the world over look towards model as five core elements: Understanding customers
lean thinking and practice to find a way to engage and context (creating the right product), process
employees in continuous improvement, [2] suggests that, excellence (delivering with speed and precision),
unfortunately, there is usually something missing in these exceptional people (high-performance teams and team
efforts. A typical lean implementation often begins with a members), capturing and applying know-how (creating
value stream mapping (VSM) exercise – to analyze the the learning organization), and product excellence
process of converting raw materials to finished goods – to (pursuing product perfection). These two works are
"lean out" the process from the bottom up. Though these significant as other previous models and frameworks for
efforts often lead to quick wins, they are by no means Lean Production have unfortunately overlooked the
sustainable, and things often have a habit of returning significance of the product dimension (for example, [8]
quickly to the status quo. We suggest a primary reason for

978-1-5386-7220-4/20/$31.00 ©2020 IEEE 551

Authorized licensed use limited to: Sintef. Downloaded on March 18,2021 at 16:38:14 UTC from IEEE Xplore. Restrictions apply.
 Proceedings of the 2020 IEEE IEEM

presents Toyota's 4Ps as philosophy, process, people & encourage and assimilate learning and improvement
partners, and problem-solving). One disadvantage, across the entire organization, rather than simply realizing
however, is that [7] is very much framed as a product static process optimization in isolated business functions.
development system, where in fact it essentially consists While VSM is a powerful tool for improving
of all of the elements described as the complete Lean manufacturing / production workflows [10], we advocate
Production system in [1]. that it is even more powerful when used to visualize entire
In this paper, based on the practical insights from a value stream “work systems”, uncovering organizational
multiple-firm action research initiative, we present an disconnects and unnecessarily complicating business
alternative, product-centric approach to the traditional processes and practices, that are otherwise unknown to
form of VSM with its process focus. The enterprise-wide other functions / stakeholders and which make for a
approach to VSM encompasses the organization in its dysfunctional organization. This is particularly relevant
entirety, with the aim of fostering end-to-end, cross- for engineer-to-order (ETO) manufacturers that exhibit
functional collaboration, learning and improvement rather project-based production systems, and do not typically
than static process optimization per se. possess highly linear material and information flows [11].
Therefore, in the following sections, we develop and
present an alternative approach to VSM as a collaborative,
II. VALUE STREAM MAPPING enterprise-wide initiative to see, understand, manage, and
improve value streams in their entirety.
A value stream can be defined as “the set of all of the
specific actions required to bring a specific product
(whether a good, service or, increasingly, a combination III. RESEARCH DESIGN
of the two) through the three critical management tasks of
any business: the problem-solving task running from Given the practical nature of the research, we adopt a
concept through detailed design and engineering to multiple-firm action research design [12] for our enquiry
product launch, the information management task running into the development and application of a product-centric
from order-taking through detailed scheduling and VSM approach at the enterprise level. Action research can
inventory, and the physical transformation task be considered as a reflective process of progressive
proceeding from raw materials to a finished product in problem solving led by individuals working with others in
the hands of the customer” [9 p.19]. Developing the teams or as part of a community of practice to improve
capability to see, understand, manage, and improve value the way they address issues and solve problems [13]. As
streams as they cut across the different functions (often such, the authors have led a “reflective problem-solving
starting from traditional, functionally organized process” with an ETO manufacturer. We take insight into
enterprises) is therefore fundamental for realizing the true the lean transformation activities of two firms within a
promise of lean thinking and practice. multinational corporation providing hi-tech. solutions to
As such, VSM has become one of the default tools for the maritime industry, having actively participated in both
organizations embarking on a lean journey and a core the development of the tool and the subsequent mapping
requirement for effective Lean Management. However, exercises that took place.
traditional VSM efforts often fail to cut across such
functional borders, typically covering only the “door-to-
door” material- and information flows inside a plant [3], IV. THE NEED TO ADVANCE BEYOND
or indeed focusing specifically on one business process at TRADITIONAL VSM
a time, for example product development [7]. This results
in lost opportunities for organizations to improve the [11] suggests that swim lane diagrams are a visual
many issues that can be found at the interfaces between management tool that can be used to visualize value
functions – for example between Research and streams in ETO and take into account non-linear and
Development and Engineering, Engineering and returning material and information flows, as an alternative
Production / Supply Chain, Production / Supply Chain to traditional value stream maps. As such, a brown-paper
and Sales, and Production / Supply Chain and Customer mapping technique was developed to visualize enterprise
Support. Thus, a major weakness that we observe in this workflows using swim-lanes. This was subsequently used
traditional approach to VSM is that many companies by the cross-functional teams to identify improvement
neglect to scale up their efforts in learning to see value opportunities within and between the organizational
streams in their entirety, i.e. scaling efforts from what [9] functions that constitute product-centric value streams.
define as the information management and physical
transformation tasks to also include the problem-solving TABLE I
task, as well as capturing additional important information Research sites
once the product has indeed found its way into the hands
of the customer, what we shall refer to as the maintenance Company Location Size (No. employees)
1 Canada 45
and end-of-life tasks. This effort requires input and
2 UK 20
collaboration spanning the entire organization to

552
Authorized licensed use limited to: Sintef. Downloaded on March 18,2021 at 16:38:14 UTC from IEEE Xplore. Restrictions apply.
 Proceedings of the 2020 IEEE IEEM

Fig. 1. Current-state value stream map.

We studied the adoption of this tool at two firms, The idea of course is to create continuous flow where we
after they experienced that the results of the lean can and pull where we cannot. As such, in the illustration,
implementation had begun to stagnate after just three the two cells are decoupled by an intermediate
years (2015-2017). For example, the cost of poor quality supermarket. Notice also that the assembly process has
had reduced by 60-80%, and on time delivery had also become the single pacemaker process, utilizing a pull
improved to a similar degree. But the companies were yet system upstream and continuous flow downstream. This
to realize the true promise of Lean Production. of course generates satisfactory results – increasing
Although VSM had been used from the outset, this efficiency in the duplication process and maybe also
had previously focused only on the door-to-door material favorably impacting the cost-of-goods-sold (COGS) on
and information flow using a traditional VSM format. To the balance sheet.
advance the lean transformation, the companies However, when we begin to adopt an organization-
recognized that something more than shop floor process wide view, we quickly begin to see that there are in fact
mapping and isolated improvement were required. The many more improvement opportunities that can be
swim-lane mapping technique was adopted to map realized, some of which automatically influence the
product-centric value streams, encompassing all business decisions and requirements that are otherwise later needed
functions throughout the enterprise. The major differences in the shop floor operations.
between traditional VSM and the enterprise-wide VSM Figure 3 represents a simplified enterprise-wide value
approach are described in the next section. stream map. Regardless of the efforts made in improving
the duplication process (here labelled Production / Supply
Chain) through value analysis, what we in fact discovered
V. ENTERPRISE-WIDE VSM during the action research at the two participating firms
was that there is much greater potential to be realized in
A traditional, current-state value stream map can be re-focusing the improvement efforts to include other areas
seen in Figure 1. Notice the linearity of the door-to-door of the business as well, in order to contribute towards
material and information flows, as well as the ‘kaizen collaborative learning and strategic improvement through
bursts’ (improvement suggestions arising from the value engineering (greater value creation) – by engaging
mapping exercise). From such a current-state map, one with Product Management, R&D / Engineering, Sales and
would typically continue to develop a future-state map Marketing, and even Customer Support; functions which
(see Figure 2). Notice here the grouping of two cells – together with Production / Supply Chain constitute the
what we may call the fabrication cell and the assembly product-centric value stream (and in particular the
and test cell. interfaces between such functions).

Fig. 2. Future-state value stream map.

553
Authorized licensed use limited to: Sintef. Downloaded on March 18,2021 at 16:38:14 UTC from IEEE Xplore. Restrictions apply.
 Proceedings of the 2020 IEEE IEEM

Fig. 3. Enterprise-wide value stream map.

VI. RESULTS However, more importantly, during the process of

“learning to see” the enterprise as a complete work
Following the adoption of the enterprise-wide VSM system, the most significant improvement opportunities
approach and subsequent engagement of the entire appeared to be found at the interfaces between different
enterprise in continuous product- and process functions (e.g. between Product Management and Supply
improvement, both participating firms witnessed a Chain; Sales and Engineering; Customer Support and
significant increase in people productivity over the next Operations), or indeed within functions other than
two years (2018-2019). In fact, because of the Production / Supply Chain. This highlights the potential
collaborative learning and improvement which emerged for adopting a more holistic approach to VSM, what we
from the enterprise-wide VSM, the companies were able refer to as enterprise-wide VSM.
to launch several new product lines, subsequently
observing growth in people productivity on the scale of
200% and 400% respectively. VIII. CONCLUSION

VSM is a practical and highly effective way to learn

VII. DISCUSSION to see and resolve disconnects, redundancies and gaps in
how work gets done [10]. Unfortunately, however, there
As [1] suggests, lean is about doing more with less – has been an all-to-common focus on applying VSM as a
solving more of the customers problems with less tool for static process optimization only. By definition, a
resources. The two firms that participated in this action value stream map should cover all three tasks described in
research initiative were able to realize just that – sustained [9], otherwise the result is a high-resolution process map
lean growth. This type of growth is very much the and at best a business process reengineering exercise. This
opposite of the otherwise static optimization that one is unfortunate, as [1] initially presented Lean Production
tends to realize by simply adopting a process-centric shop as an holistic system consisting of five core parts: Dealing
floor perspective during a traditional VSM initiative. with the customer, designing the car, running the factory,
Rather than settling for the adoption of the popular coordinating the supply chain and managing the
“door-to-door” production process flow perspective of enterprise.
VSM, representatives from all business functions at the Lean has more recently been described as a learning
two firms (Product Management, Research and system rather than a production system [14, 15]. As such,
Development / Engineering, Operations, Supply Chain, in this paper, we present swim lane mapping as an
Sales and Customer Support) became engaged in alternative form of VSM which can be used to engage all
mapping entire “product-centric” value streams as holistic stakeholders in cross-functional, collaborative learning
work systems – first in order to develop learning and improvement. We call the approach "enterprise-wide
capabilities and second to further exploit the learning for VSM", and like [11], we also see the potential for such a
strategic improvement. mapping technique in the ETO manufacturing domain in
The investigation also revealed that the physical particular.
transformation task and associated information This article presents the yet unexploited potential for
management task that constitute the Production / Supply enterprise-wide VSM as a tool to foster cross-functional,
Chain function were in fact currently the most streamlined collaborative value stream management – allowing all
and effective “tasks” within the entire enterprise (not functional "silos" in an enterprise to firstly learn-to-see
surprising due to the previous three years of lean and secondly learn-to-learn – by seeing, understanding,
implementation efforts). and improving value streams in their entirety. We used

554
Authorized licensed use limited to: Sintef. Downloaded on March 18,2021 at 16:38:14 UTC from IEEE Xplore. Restrictions apply.
 Proceedings of the 2020 IEEE IEEM

enterprise-wide VSM to visualize product-centric value [13] E. T. Stringer, Action research. Thousand Oaks:
streams as complete systems of work, rather than simply Sage publications, 2013.
focusing on the physical transformation and information [14] D. J. Powell and P. Coughlan, "Rethinking lean
management tasks in isolation. We suggest that such a supplier development as a learning system,"
tool can be used by researchers and practitioners to International Journal of Operations & Production
promote organizational learning and improvement, Management, 2020.
particularly in ETO / project-based production [15] M. Ballé, J. Chaize, and D. Jones, "Lean as a learning
environments. system: What do organizations need to do to get the
transformational benefits from Toyota’s method?,"
Development and Learning in Organizations: An
ACKNOWLEDGMENT International Journal, 2019.

The authors would like to acknowledge the support of

the Research Council of Norway for the research program
SFI Manufacturing and the research project Lean Digital.

REFERENCES

[1] J. P. Womack, D. T. Jones, and D. Roos, The

Machine that Changed the World. New York: Harper
Perennial, 1990.
[2] J. K. Liker and M. Hoseus, Toyota Culture: The
Heart and Soul of the Toyota Way. New York:
McGraw-Hill, 2008.
[3] M. Rother and J. Shook, Learning to See.
Cambridge: Lean Enterprise Institute, 2003.
[4] M. Ballé, N. Chartier, P. Coignet, S. Olivencia, D.
Powell, and E. Reke, The Lean Sensei. Go. See.
Challenge. Boston, MA: Lean Enterprise Institute,
Inc., 2019.
[5] T. Sakai, The Secret Behind the Success of Toyota.
London: Amazon, 2018.
[6] M. Ballé, D. Jones, J. Chaize, and O. Fiume, The
Lean Strategy: using lean to create competitive
advantage, unleash innovation, and deliver
sustainable growth. New York: McGraw Hill
Professional, 2017.
[7] J. M. Morgan and J. K. Liker, Designing the Future.
New York: McGraw Hill, 2018.
[8] J. K. Liker, The Toyota Way: 14 Management
Principles From the World's Greatest Manufacturer.
New York: McGraw-Hill, 2004.
[9] J. P. Womack and D. T. Jones, Lean Thinking:
Banish Waste and Create Wealth in Your
Corporation. New York: Simon and Schuster, 1996.
[10] K. Martin and M. Osterling, Value stream mapping:
how to visualize work and align leadership for
organizational transformation. New York: McGraw-
Hill 2014.
[11] D. J. Powell and A. van der Stoel, "Lean Engineer-
to-Order Manufacturing," in The Routledge
Companion to Lean Management, D. J. Powell and
T. H. Netland Eds. New York: Routledge, 2017.
[12] P. Coughlan and D. Coghlan, "Action Research," in
Research Methods for Operations Management, C.
Karlsson Ed. Abingdon: Routledge, 2016, sec.
Action Research, pp. 233-267.

555
Authorized licensed use limited to: Sintef. Downloaded on March 18,2021 at 16:38:14 UTC from IEEE Xplore. Restrictions apply.