Simplifying Value Stream Mapping for Agile/Scrum Teams

What's the minimum you need to know to start using Value Stream Mapping

Sep 03, 2023

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Q: Hi Vibhor! Thanks for all the help you provide on all these platforms. My question is regarding Value Stream Mapping. I am an enterprise Agile Coach working in the banking sector. There is a sudden interest in value stream mapping and how it can be used within my department. I did my research and still can’t wrap my head around the concept. Can you help simplify it for Agile teams?

Absolutely and thanks for the question.

A few years ago, I was working with a large financial institution here in Toronto that was struggling with long lead times, missed deadlines, and overall dissatisfaction from both their teams and their customers. We already adopted Agile at a team level but were not able to see the benefits we hoped for at the enterprise level.

One of the key challenges was that while individual teams were working efficiently, there were significant delays and inefficiencies at the handoff points between teams and departments.

For example, a feature developed by the development team would often sit idle, waiting for the DevOps team to pick it up. This not only led to delays but also caused a lot of frustration among the teams, as they felt they were being held accountable for delays that were out of their control.

In an effort to address this, to find out what actually was causing the delays, we decided to use Value Stream Mapping to visualize the entire process from concept to cash.

And let me tell you, it was an eye-opening experience.

But before I dive deep into the core, let’s first understand the surface. Let’s understand what a Value Stream actually is.

What is a Value Stream?

Any product or service that delivers measurable value to a company (internally) or a customer represents a value stream.

Below are a few examples of value streams in a banking environment:

Loans: This includes the steps from a customer applying for a loan, the bank processing the application, checking credit history, approving or denying the application, and disbursing the funds if approved.
Credit Cards: This involves the customer applying for a credit card, the bank processing the application, checking credit history, approving or denying the application, and issuing the card if approved.
Online Banking: This includes the steps from a customer signing up for online banking, setting up their username and password, setting up security questions, and starting to use the online banking features.
Mobile Banking: This involves the customer downloading the bank's mobile app, signing up or logging in, setting up security features, and starting to use the mobile banking features.
Account Transfer: This includes the steps from a customer initiating a transfer of funds from one account to another, the bank processing the transfer, and the funds being available in the recipient's account.
Bill Payment: This involves the customer setting up a bill payment, the bank processing the payment, and the payment being received by the payee.
Account Closure: This includes the steps from a customer requesting to close an account, the bank processing the request, checking for any outstanding balances or fees, and closing the account.

How to identify value streams within your organization?

Just look at the products and services your organization offers to the customers (internal or external).

The end-to-end workflow (all events and activities) that is used to deliver that product or service to the end-user is a value stream.

In simple words, a value stream is nothing but a workflow that ends by providing value to the customer.

What is Value Stream Mapping?

Value Stream Mapping, or VSM, is a method from LEAN thinking that helps to visually show all the steps in a Value Stream, along with important details like time spent on each step.

This helps to smartly improve and make the whole process better.

If you don’t know what lean is, watch the video below, which is the first in a series of videos on lean I created.

James P. Womack and Daniel T. Jones define Value Stream Mapping in their book Lean Thinking: Banish Waste and Create Wealth in Your Corporation as follows:

"Value Stream Mapping is a lean-management method for analyzing the current state and designing a future state for the series of events that take a product or service from its beginning through to the customer."

In other words, if you just

list all the steps in a value stream,
identify which steps are not important and
work with the team to eliminate those unnecessary steps.

you are basically doing what’s called Value Stream Mapping.

“Mapping” because you use certain symbols (shown below) to visually map each step.

Let’s use an example to understand it even better.

Imagine you are planning a road trip from your home in Delhi to a friend's house in Bangalore.

Your Vision (Future State) = Be in your friend's house.

To do this, you would probably use a map (or a GPS app) to plan your route from Delhi to Bangalore.

For example, you may have to:

take a few highways,
cross a few cities,
stop for gas, food, etc.

These are very high-level steps you will take to reach your destination.

The steps in this trip can be divided into three parts:

1. Value-adding steps: These are the steps that are absolutely necessary for you to reach your destination. For example,

driving on the highway,
following the traffic rules, etc.

2. Non-value-adding but necessary steps: These are the steps that do not directly add value to your trip but are necessary. For example,

stopping for gas,
taking a restroom break.

3. Non-value adding and unnecessary steps: These are the steps that neither add value nor are necessary. For example,

taking a scenic route that adds extra time to your trip,
stopping at a store to browse, even though you don’t need anything.

In the context of this trip

The "value stream" would be all the steps or activities, Value-adding + Non-Value-adding-necessary + Non-Value-adding-unnecessary, that you take from the moment you leave your house to the moment you arrive at your friend’s house.

The purpose of creating a Value Stream Map is to identify and eliminate the non-value-adding and unnecessary steps in the process.

In this example, it could mean

choosing a more direct route,
ensuring your car is filled with gas before you leave, and
avoiding unnecessary stops.

Here is a simple diagram representing the process of planning and executing a road trip from your house to your friend's house, highlighting the value-adding, non-value adding but necessary, and non-value adding and unnecessary steps:

In the above diagram:

Value-adding tasks are highlighted in green
Non-value-adding but necessary tasks are highlighted in orange
Non-value-adding and unnecessary tasks are highlighted in red

In the context of your work

This could mean identifying and eliminating wasted:

time,
resources, and
effort

in the process of delivering a product or service to a customer.

The end goal is to create a process that is leaner, more efficient and something that delivers more value to the customer and to the business in the least amount of time.

Let’s go through a Value Stream Mapping process for a product development team

The official steps to create a Value Stream Map involve several movements like:

Identify the VS
Make the team
Identify scope
Identify steps
Touch time
Wait time
Cycle time
Value Addition
Evaluate time spent
Repeat

We, however, will use a more simplified version as follows:

1. Simply sit with your team and list all the tasks and activities (steps) required to deliver the product (or product increment) to your customer in a spreadsheet.

2. Also, list the corresponding time it takes to complete each step. You can use any unit of time. I prefer to use hours.

3. Then work with your team to identify the:

Value-adding tasks and highlight them in green
Non-value-adding but necessary tasks and highlight them in orange
Non-value-adding and unnecessary tasks and highlight them in red

This is your Value Stream Map.

4. Once you have highlighted the tasks that are Non-Value-Adding and Unnecessary, conduct a brainstorming session with all necessary players, like team members, stakeholders, leads etc., to find ways to eliminate these tasks.

To learn about various brainstorming techniques, watch the video below.

The final version of the map with Non-Value-Adding Tasks removed is your optimized Value Stream.

The total number of hours with all the non-value-adding tasks removed in the above example is:

5635 - 715 = 4920 hours.

Which is a massive saving of 715 hours.

Note: The # of hours in the above example are calculated for a 5-member team, with each member working 8 hours per week.

Objection: Without the icons/symbols, it doesn’t look like a map.

That’s true.

An “official” Value Stream Map is made out of the following symbols:

It might not be, however, the most valuable use of your time to create a map for the 40 steps by figuring out what each symbol means. This in itself is a Non-Value-Adding and unnecessary task, in my opinion.

The real value of Value Stream Mapping is in improving the process (not in creating a map) by eliminating waste. This can be achieved by using a simple spreadsheet.

Technical Terms Simplified

Now that we understand what Value Stream Mapping is, let's review some common technical terms related to this technique using our road trip example.

Note: The term “segment” used below refers to the individual parts or sections of the entire road trip.

For example,

one segment could be driving from your home to the gas station,
another segment could be from the gas station to a rest stop, and
another from the rest stop to your friend's house.

Each segment is a portion of the journey that involves a specific task or activity, such as driving a certain distance, stopping for gas, taking a rest break, etc.

What should prompt you to use Value Stream Mapping?

Here are some scenarios that should prompt you to use Value Stream Mapping:

Complex Processes: If your team is involved in complex processes where multiple steps, people, or departments are involved, VSM can help in understanding the entire process.
Inefficiencies or Delays: If your team is experiencing delays, long lead times etc., VSM can help in identifying the bottlenecks and areas of improvement.
Lack of Understanding or Miscommunication: If there is a lack of common understanding among team members about the workflow or if there are communication issues, VSM can help create a common understanding of the process and improve communication.
High Amount of Waste: If there is a high amount of waste in the process, such as waiting times, unnecessary tasks, or over-processing, VSM can help in identifying and eliminating this waste.
Alignment with Organizational Goals: If there is a need to ensure that the team's activities are aligned with the organizational goals, VSM can help in the alignment and identifying any gaps.
Customer Satisfaction: If there is a need to improve customer satisfaction by delivering higher quality products or services in a shorter time frame, VSM can help in identifying the areas of improvement that will have the most impact on customer satisfaction.
New Teams or Processes: If you have a new team or have made significant changes to your processes, VSM can help in creating a clear and common understanding of the new workflow.

What to keep in mind is that, as with everything else in Agile Value Stream, Mapping is not a one-time activity. It is a continuous process and needs regular updating.

Value Stream Mapping is Not for:

Small Scale Projects
It focuses on the entire process. It is not suitable for solving detailed technical problems or for doing a deep dive into specific technical issues.
Quick Fixes
Static Environments where processes do not change frequently
Isolated Problems. It is a holistic tool that looks at the entire process. It is not suitable for solving isolated problems that do not impact the overall workflow.
Short-term planning of day-to-day tasks

Value Stream Mapping is a powerful tool, but it may not be suitable for everyone. Before diving into this technique, it is crucial to understand the 'WHY' - the reason you or your organization need it.

This understanding will help in determining if it is the right approach for your specific needs and goals.

This is it 🙏

If you have any questions (related to this topic), don’t forget to use the comments section to ask.

Further Resources

1. Book: Learning to See: Value Stream Mapping to Add Value and Eliminate MUDA by Mike Rother and John Shook

2. Online Course: Value Stream Mapping on Coursera

3. Video: Introduction to Value Stream Mapping

4. Research Paper: A Review & Methodology of Value Stream Mapping

💡 Tip of the week.

Say, "Kindly mute your microphones if you're not speaking.”

No one enjoys background noise, but it takes a proactive team member to address it.

If there is noise interference, politely interject with,

“I’m sorry to interrupt, but there seems to be some background noise. Could we all please mute our microphones when not speaking?”

This simple act will not only make the call more pleasant and efficient for everyone but will also showcase your proactive approach and leadership skills.”

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Till next week!

Sincerely,

Vibhor 👋

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“I share things I wish I knew in the starting years of my career in the corporate world"

Vibhor Chandel

Winning Strategy