The process begins and ends with the customer, and it focuses on actual value delivered to them – not on the company’s perception of value.

Value stream mapping can drive digital transformation by increasing the frequency of data-driven decision making, eliminating waste, and instituting a more effective management systems. The process is sometimes referred to as “value stream analysis,” and it involves actionable steps that increase efficiency. When a company engages in value stream mapping, they must pinpoint specific inefficiencies and assign related tasks to employees who work on solving the problem.

Value stream transformation is related to Six Sigma, a methodology for process improvement in business. Developed in the 1980s, Six Sigma puts great emphasis on identifying and removing defects before they cause further problems down the line. Value stream mapping and value stream transformation are frequently mentioned alongside Lean Six Sigma (LSS), a Six Sigma-developed approach that involves a collaborative effort by a dedicated team. Value stream mapping is considered a key tenet of the LSS approach.

Waste detected during value stream mapping might include product imperfections resulting in high replacement costs; overproduction; overprocessing and the inclusion of unnecessary steps in the product life cycle; early release without adequate testing; and unnecessary transportation costs accrued from too much movement of the product or service.

Value stream transformation best practices include assembling a team, often during a physical event or meeting; physically mapping the value stream; being intentional and specific about the scope of work; and creating a current state map and a future state map.

The benefits of value stream transformation are many:

1. Reduction of costs during manufacturing

2. More efficiency

3. Reduced amount of product

4. Increased CSAT (customer satisfaction score)

5. Improved cross-functional collaboration

6. Reduction of waste and bottlenecks

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