Beau Keyte - The Complete Lean Enterprise: Value Stream Mapping for Administrative and Office Processes

Thanks to my dad and Debi, whose constant love and support have carried me through these years and allowed me to chase my dream. And, thanks to my great clients who have worked with us to implement fundamental new thoughts and actions.

-Beau Keyte

To Eileen, without your love and support I could never succeed. Thanks to all of the companies with whom I have workedyou are the true innovators.

-Drew Locher

To everyone at the Lean Enterprise Institute and the Lean Enterprise Academy for giving us the opportunity, time and support in testing these new waters. Special thanks to John Shook and Mike Rother for paving the way.

Whenever there is a product for a customer, there is a value stream. The challenge lies in seeing it.

-Mike Rother and John Shook, Learning to See

When you have learned to see value streams in individual facilities, it's time to see and then optimize entire value streams from raw material to the customer.

-Dan Jones and Jim Womak, Seeing the Whole

When you have learned to see the "raw material to the customer" value stream, it's time to see, challenge, and optimize how the rest of the enterprise supports the core value stream.

-Beau Keyte and Drew Locher

Foreword ix

Introduction xi

Chapter 1: Applying Value Stream Mapping to Information Management 1

Applying Value Stream Mapping to Non-production Areas 3

Purpose of the Case Study 4

Chapter 2: Getting Started: Mapping Office Value Streams 5

Understanding Value Stream Mapping Basics 6

Scoping the Selected Value Stream and Choosing the Mapping Team 8

Chapter 3: Identifying Office Wastes 15

Determining Value from Waste in Administrative Activities 16

Chapter 4: ABC Design's Lean Transformation in the Production Area 19

Chapter 5: Assessing the Office Current State 23

Step 1: Document Customer Information and Need 24

Step 2: Identify Main Processes (In Order) 24

Step 3: Select Process Metrics 25

Step 4: Perform Value Stream Walk Through 33

Step 5: Establish How Each Process Prioritizes Work 33

Step 6: Calculate System Summary Metrics 34

Chapter 6: Designing the Current State Map for ABC Design 37

Step 1: Documenting Customer Information and Need 38

Step 2: Identifying Main Processes (In Order) 39

Steps 3 and 4: Selecting Process Metrics and Filling In the Data Boxes 40

Step 5: Establishing How Each Process Prioritizes Work 46

Step 6: Calculating System Summary Metrics 47

Reflecting on the Current State Map 50

Chapter 7: Thinking Lean at the Functional Level 55

Sales, Marketing, and Operations 56

Order Processing 57

New Product Design 59

Inventory Control 60

Purchasing and Inventory Management 61

Scheduling and Production Control 62

Quality Management 63

Cost Accounting 64

General Accounting 65

Human Resources 66

Chapter 8: Designing a Future State 67

Question 1: What Does the Customer Really Need? 68

Question 2: How Often Will Performance Be Checked? 70

Question 3: Which Steps Create Value and Which Generate Waste? 72

Question 4: How Can Work Flow with Fewer Interruptions? 73

Question 5: How Will Work Be Controlled Between Interruptions? 76

Question 6: How Will the Workload And/Or Activities be Balanced? 78

Question 7: What Process Improvements Will Be Necessary to Achieve the Future State? 79

Chapter 9: Designing ABC's Future State 81

Assessing Customer Requirements 81

Determining Management Time Frame 83

Removing Wastes 84

Flowing Work 88

Pulling Work 93

Leveling Work 94

Achieving ABC's Future State 94

Summing Up-Results of ABC's First Future State 95

Chapter 10: Achieving the Future State 97

Tie the Value Stream Design to the Company's Business Objectives 97

Break the Work Plan into Loops 98

Prioritize Loop Implementation 98

Create a Work Plan and Cross-Functional Implementation Teams 103

Enabling Value Stream Management 104

Appendix 107

About the Authors

An alternate title for this book could be Waste in the Office: The Final Lean Frontier. Beau Keyte and Drew Locher have accomplished an ambitious taskone that can benefit anyone concerned with creating maximum value for customers with as little waste as possible.

How much waste is there in an enterprise? Stated differently, what percent of activities undertaken by each of us every day actually contribute toward the creation of value for our customers? Quantifying waste on such a scale would, no doubt, be an endeavor that would in itself constitute waste, and a massive amount of it at that. Certainly, when we ask how many of our actions directly provide value for our customers, the answer is loud and clear: painfully little.

Since the publications of The Machine That Changed the World in 1989 and Lean Thinking in 1997, hundreds if not thousands of firms around the world have launched initiatives to eliminate waste in their operations. Many of those efforts have been fantastically successful while others have proved frustratingly slow or even ineffective. Either way, the great majority of those efforts have been aimed at the plant floor or other direct operations. Yet, as firms proceed with improvement activities on the plant floor they encounter the inevitable reality that fundamental change-even on the plant floorultimately requires the involvement and support of the entire enterprise.