As more and more processes are digitized, Value Stream Managers, waste hunters and process improvers have to adapt their approach as many of their beloved methods and tools may not work anymore. Take the example of manufacturing a widget that is now 3D-printed and doesn’t need all the previous traditional manufacturing steps of metal cutting, machining, drilling, milling, assembly and welding anymore.
Value Stream Mapping will show a single data box for the 3D-printer, with raw material inventory in front of it and may be a shipment buffer behind the printer. Not many wastes left in this process…
What probably remained or even got some inflation is the data processing part of the Value Stream Map, the one that is pretty invisible.
Yet this doesn’t mean there is nothing to improve. So, what to look for when improving a digital process?
Look for data with Process Mining
There is an already started shift of importance from physical flow to information flow in many industries going digital. With help of Process Mining software, the massively collected data can reveal lots of so far unnoticed wastes, waiting to be turned into improvement potentials.
Process Mining softwares draw process maps instantly and dynamically and allow analysis of large actual datasets, not sampled values nor questionable “facts” gathered with extensive (and often questionable) interviews.
The data flows tell the true stories of how many placed orders were finally cancelled by customers, how many products had to have rework, how many have been scrapped, when, by which resource and where in the value stream.
Process Mining softwares calculate the true lead time for any product, product family or variants, instantly and per mouse click.
The improvement opportunities uncovered by this new way to analyse the processes are numerous, therefore Value Stream Managers, waste hunters and process improvers will not be short of occupation, provided they adapt to the new way and go digital themselves.
Look for new types of wastes
The future of improvement will be less about the 7 or 8 muda than new types of wastes probably gone unnoticed until then.
Take the previously mentioned orders cancellations for example. What is their frequency? What turnover is lost every month, every year and for what reasons? These are losses from the very start of the process, with potential effect downstream if cancellation is accepted when some expenses to fulfill the orders have already been booked.
How many orders waited in queues for manual/human credit clearance and how many were really rejected? What consequences for the extra time spent by the finally-cleared-orders? For customer satisfaction and for time-to-cash? It would be no wonder that the manual clearance part of the process is more of a waste than a meaningful and relevant safekeeper.
Another common loss of revenue are the penalties or discounts for delivering later than initially confirmed or for complaints. In their trail, other extra expenses like extra expediting shipping costs, overtime, rush subcontracting can be uncovered.
Non compliance and deviations from standards and rules, like maverick buying for exemple can accumulate substantial extra expenses. Non compliance to regulatory rules or to contract terms can lead to pay penalties and/or to be denied to operate longer.
These are only some examples of “new” types of waste and improvement potentials. They aren’t really new, but went long unnoticed or too difficult/long/costly to consolidate and analyze.
With new tools, like Process Mining, those wastes and potentials will be easier to uncover and work on.
As previously stated, Value Stream Managers, waste hunters and process improvers will not be short of occupation.
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About the author, Chris HOHMANN
Chris HOHMANN 