Order flow analysis and value stream mapping

Introduction: Brief definition and purpose of order flow analysis

Throughput analysis, also known as "flow analysis" or "process flow analysis", is an important approach in process optimization. The aim of flow analysis is to identify, document, measure and analyze the flow of materials and information in a company in order to identify and eliminate potential delays and bottlenecks.

Through a comprehensive analysis of the process flow, companies can improve their processes and optimize them with regard to the 7 types of waste from LEAN management. Flow analysis also helps to standardize processes and achieve process improvements by ensuring that each activity in a process has a clear purpose and does not contain unnecessary steps.

Overall, throughput analysis is a valuable tool for process optimization, as it enables companies to understand their processes, improve them and make them more efficient.

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TABLE OF CONTENTS

History of order flow analysis

The history of throughput analysis dates back to the 1930s, when industrial engineering techniques were first used to optimize processes in industry. One of the pioneers in this field was Taiichi Ohno, a former vice president at Toyota, who developed the concept of "just-in-time" production. This method aims to reduce overflows and the 7 types of waste in processes by ensuring that each activity is carried out immediately before it is used.

Since the early days of industrial engineering, flow analysis has become an important method in process optimization. Today, it is used in a wide range of industries, from manufacturing and processing of goods to healthcare and administration.

Objectives and advantages of order flow analysis

Throughput analysis involves the identification and evaluation of weak points within a process. These can lead to the process being slower or less efficient, which in turn can affect the overall performance of the system.
Tools such as process descriptions or process maps are often used to identify weak points and bottlenecks. It is also necessary to actively run through the process under consideration.

 

Application areas of order flow analysis

Throughput analysis is an important part of process management and is used in a variety of application areas. Areas of application can be: production, logistics, services and administration. Throughput analysis is used to optimize processes, increase process efficiency and improve customer satisfaction. The aim is to make processes faster, more efficient and more cost-effective. Throughput analysis is a valuable tool for identifying process improvements and implementing process optimization measures. It also supports compliance with legal and regulatory requirements.

The order flow in the company profile for a production company

Figure 1: The order flow in the company picture for a production company.

Steps of the order flow analysis:

a. Identification of the process / documentation of the process
The first step in throughput analysis is to identify the process to be analyzed. This includes analyzing the business flow and defining clear goals and target groups. It is important to develop a deep understanding of the process in order to conduct a thorough analysis. Identification of the process should be done through a comprehensive review of documents, interviews with stakeholders and observations to gain a complete understanding. An essential step in the throughput analysis is the documentation of the process. This involves accurately capturing and recording the activities that are carried out during the process. This includes mapping the sequence of activities, the people involved and the time taken for each activity. Documenting the process helps to develop an understanding of the procedures and dependencies and makes it easier to identify potential for improvement. It is important to create documentation that is as accurate and detailed as possible in order to be able to carry out a well-founded analysis.
b. Structural analysis of the order flow
The structural analysis is a central step in the throughput analysis. It involves analyzing the processes in the company in order to understand the flow of a specific order through the company. By analyzing the throughput, possible bottlenecks, inefficiencies and waste can be identified and targeted improvements implemented.
c. Improving the order throughput
The last step of the throughput analysis relates to improving the throughput. The aim here is to eliminate the identified bottlenecks and bottlenecks and optimize the efficiency of the process. This can be achieved through measures such as automating certain process steps, reducing waiting times or shortening throughput times. Effective implementation of the improvements requires a systematic approach to ensure that all relevant stakeholders are on board and that the implementation is carefully planned and executed. The results of the improvements should be regularly monitored and evaluated to ensure that the desired effect is being achieved.

Advantages of order flow analysis

Identification of bottlenecks and weak points in processes

Increased transparency of processes and thus improved controllability

Increased flexibility and adaptability to changing requirements

Increased competitiveness through cost savings and quality improvements

Elimination of waste and cost reduction

Increasing process quality and reliability

Increase in productivity

Reduction of stock levels and associated costs

Increased customer satisfaction through faster delivery times

Introduction: Brief definition and purpose of value stream mapping

Value stream mapping is a method for optimizing processes. The focus is on creating added value for the customer. In the first step of value stream mapping, all activities and material flows within a process are recorded and evaluated for their contribution to creating added value. The use of the so-called value stream map can be helpful here. This visualizes the workflows and material flows within the process and makes it easier to identify value creation potential and waste. By systematically carrying out value stream mapping, process design can be improved and efficiency increased, leading to greater customer satisfaction and a better business result.

 

History of value stream mapping

Value stream mapping, also known as value stream mapping, is a method that has its origins in the Toyota Production System (TPS). It was developed in the 1980s by Taiichi Ohno to enable more efficient production. Value stream mapping refers to the representation and optimization of the flow of value-added activities in a process. It is an essential tool for realizing lean management concepts that aim to achieve the most efficient manufacturing possible by identifying and removing waste. Value stream mapping is a visual method in which the material and information flows in a process are recorded in order to improve the efficiency of the process and optimize workflows.

Objectives and advantages of value stream mapping

Value stream mapping is an important part of lean management and aims to maximize added value for the customer and minimize the 7 types of waste. By systematically analyzing the value chain, companies can find out which activities are important for the customer and which can be classified as unnecessary waste. This allows processes to be optimized and efficiency to be increased. In addition to increasing efficiency, value stream mapping also provides a better overview and control of the process flow as well as a clear prioritization of improvement potentials.

Areas of application of value stream mapping

Value stream mapping is a useful tool for optimizing business processes that can be used in a variety of industries and application areas. Some of the most important areas of application are the manufacturing industry, the service industry, healthcare, energy supply and logistics. Value stream mapping is particularly useful for eliminating waste and creating a more fluid process flow. By helping to identify, optimize and implement processes, value stream mapping helps to improve efficiency and productivity, reduce costs and increase customer satisfaction.

Figure 2: First, the individual process steps must be described. The object of consideration for the value stream analysis is always a product or a product group. It is therefore important to ensure that only products or product groups that share most of the process steps are selected.

Figure 3: The material flow is now entered.

Figure 4: A lot of information has to be exchanged in the value stream. The increasing digitalization in value streams makes it necessary to determine where there are "isolated solutions" and where there are system interventions, e.g. by an ERP system. These different paths are represented by the information flow.

Figure 5: Identified weak points are marked with the Kaizen flash. The individual Kaizen flashes can be transferred to a separate list and visualize the specific need for action in the recorded value stream.

Steps of value stream mapping:

a. Identification of the product or service for which the process is to be optimized.

Since value stream mapping is very time-consuming, it makes sense to prioritize products and services in terms of optimization potential.

It is important to develop a deep understanding of customer needs to ensure that the organization delivers its products or services in an efficient and effective manner.

Synergy effects should also be taken into account here: Which optimization has an impact on different products and services? Where is the effect multiplied?

b. Creation of a value stream diagram

The steps of value stream mapping include the creation of a value stream diagram, which is a graphical representation of the flow of materials and information within a process. This method is used to identify and eliminate potential waste in a process in order to achieve greater efficiency and added value. Creating a value stream diagram requires a deep understanding of the processes as well as close monitoring of the material and information flow from the product idea to customer delivery.

c. Identification of value creation activities
Identifying value creation activities is an important step in value stream mapping. The aim is to identify all activities that contribute to the fulfillment of customer needs and thus lead to the creation of added value. This includes both direct and indirect activities. The analysis and evaluation of these activities makes it possible to gain an understanding of the efficiency of the current process and, if necessary, to identify optimization potential.
d. Optimization of value creation activities
The optimization of value creation activities is a critical step in value stream mapping that involves the implementation of identified opportunities to improve processes and systems. Methods such as lean management or the use of Kaizen principles can be used to achieve a more efficient use of resources and a reduction in waste. The aim is to optimize the value stream and thus increase customer satisfaction and loyalty and achieve cost savings.
e. Implementation of the optimizations

The implementation of the optimizations is a decisive step in the value stream analysis. Here, the identified opportunities for improving value creation activities must be put into practice. Implementation requires the cooperation of all departments involved and may involve a significant change to the process flow. It is important to continuously monitor the implementation to ensure that the optimizations are effective and sustainable. Regular reviews and adjustments can ensure that the added value is constantly optimized and meets the needs of the customer.

Advantages of order flow analysis

The use of value stream mapping can bring a number of benefits to a company, some examples include

Cost savings:

By identifying and eliminating waste in the process, value stream mapping can help to reduce costs.

Quality improvement:

The quality of products or services can be improved by optimizing processes.

Time saving:

By optimizing processes and eliminating waste, the throughput time of processes can be shortened.

Increased flexibility:

Value stream mapping can increase adaptability to changing customer needs.

Increased transparency:

By visualizing the flow of materials and information, the company gains a better overview of its processes and can therefore make better decisions.

Increase in customer satisfaction:

By optimizing processes and increasing quality and flexibility, customer satisfaction can be increased.

Increased employee motivation:

By helping to identify waste and develop suggestions for improvement, employee motivation can be increased ("turning those affected into participants")

Increase in efficiency:

Value stream mapping can help to increase the efficiency of processes and improve process performance.

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Delimitation

Similarities and differences

Throughput analysis and value stream mapping are both methods that appear similar at first glance. Both approaches aim to optimize processes and identify processes that do not create added value for the customer. However, there are also significant differences between these methods.

Throughput analysis focuses on the material flows within a process. The objectives of this method are to reduce excess stock and waiting times and to speed up the material flow. In contrast, value stream mapping goes one step further and looks not only at the material flows, but also at the value creation activities within a process. The aim of value stream mapping is to maximize added value for the customer.

It is important to recognize that both methods complement each other and can be used together. A flow analysis can help to optimize procedures in the process, while a value stream analysis identifies the steps that create the greatest added value for the customer. These two approaches can therefore be used in combination to achieve comprehensive optimization of processes.

Summary and recommendation for choosing the right method

Throughput analysis and value stream mapping are both methods for process optimization. Throughput analysis concentrates on increasing efficiency by reducing surpluses and losses. Value stream mapping, on the other hand, focuses on maximizing value creation for the customer and eliminating all activities that do not offer added value for the customer.
While both methods are linked, in practice it is recommended to choose value stream mapping for a thorough and comprehensive process optimization, as it provides a clearer understanding of customer needs and a focus on value creation.
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