Value Streams Are Misunderstood

I really like seeing more and more organizations trying to implement lean.  Seeing organizations start to understand lean and want to improve using the lean mindset and principles is very refreshing.  A great step in the right direction.

But not all lean starts are created equally.  Or for that matter even get off on the right foot.

I recently saw a company giving a presentation on some HR practices and apprenticeship.  They were doing some really great stuff around apprenticeship for a machining shop.

What caught my eye was their comments about lean and aligning to value streams.  The company listed their value streams on a slide.  The first few sounded more like machining functions rather than a value stream but I don’t understand the business so I could be wrong.  Then I saw the bottom half of the list: Accounting, Project Management, Human Resources, etc…

Yikes!  These are not value streams.  These are functions that support value streams.

Misunderstanding of value streams is quite normal.  In order to be a value stream, it has to create value for the customer.  To understand what creates value a company has to have a definition of value.

I use one I learned from the Lean Learning Center:

• The customer must be willing to pay for it

• It must change the form, fit or function of the product/service

• It must be done right the first time

In a machining shop, accounting does not create any value for the customer.  Nor does Project Management.

Value streams are linked process that create value to a product or service for customer.  The are not departments (accounting , project management) or functions (milling, cutting).

Grasping the true meaning of value streams and what your companies value streams are can really open your eyes to the improvement possibilities.

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