At first sight or rather "at first googling" you will find a lot of redundant information if you type the terms "Value Stream Mapping" and "Process Mining" into the search field. In this article we will explain why this is the case, what the core of Value Stream Mapping is and why Process Mining takes Value Stream Mapping to a new level.
Value stream mapping is a lean management method for analyzing the current state (value stream analysis) and designing a future state (value stream design) for the processes that a product or service goes through from the beginning of creation until it reaches the customer. Accordingly, in the first step, the as-is state of a process is recorded and visualized in detail, showing all critical steps and quantifying the time and material expenditures in each phase. The primary goal of the VSM is always to reduce waste within the processes.
The process is evaluated within the framework of the VSM in terms of its contribution to value creation and alignment with the customer.
Processes required to deliver a product or service are visualized, and waste and potential for improvement are identified.
Typical questions that are answered: How does my production function today in an overall context? Where are the biggest opportunities and optimization potentials to be found? How high is my waste? Where and how can I reduce waste?
VSM meets Process Mining
In summary, VSM is an approach that makes it possible to analyze a company's value creation processes holistically and to understand causal relationships in complex processes. The results can be used to determine which process adjustments offer the greatest potential for improving overall performance.
VSM is not a one-time activity, but is used within the framework of continuous process improvement as an ongoing or repetitive methodology according to the concept PLAN - DO - CHECK - ACT (see the following graphic). In the meantime, a new level is always reached. The value stream is thus optimized further and further in the interests of the customer.
Based on this methodology, software tools have been developed to help companies perform value stream mapping with tool support. For some time now, Process Mining technology has emerged as a game changer.
Process Mining is a technology that reconstructs and analyzes business processes based on their digital traces in various IT systems. Digital traces thus become information. The procedure can be compared with a digital, automated value stream analysis.
A small interim conclusion at this point: Where value stream maps have often been captured manually and through interviews and stopwatches on the production floor, Process Mining can automatically scan IT systems for the necessary information and provide the process map and quantification of waste in an automated manner. In this way, analysis is no longer based on subjectively captured information, but on objective facts. Process Mining also offers a whole host of new possibilities, which we will discuss later.
"Reducing cycle time to one-quarter increases productivity by about 50% and reduces costs by about 20%." (James P. Womack, founder of the Lean Enterprise Institute)
Lead times and delivery times are key signposts in value stream mapping. Reducing total time is possible primarily by reducing waiting times – one of the seven types of waste. Process Mining is used to determine lead times automatically. The reasons for long waiting times and unnecessary process loops can also be quickly uncovered and eliminated using so-called "root cause analysis".
What added value does VSM offer with Process Mining?
Process Mining offers an objective view of your processes and uncovers reality. Because every process has three states:
How you think the process runs
How the process does really run
How the process should run
You will be surprised how many loops and dead ends your processes go through. Using Process Mining, these actual process flows, including all variants and essential value stream indicators, can be displayed and explored in meaningful dashboards. The added value compared to ordinary value stream analysis is that not only a "snapshot" of a process is taken, but data is used as a basis, which enables a holistic view and guarantees repeatability at any time. Depending on the tool, it is even possible to look into the future on the basis of learning algorithms.
Based on corporate structures and value chains that are based on digital processes, knowledge and competitive advantages can thus be achieved – and completely automatically. Depending on the tool, all phases of VSM can be intelligently supported:
- Visualize & Discover Processes | Gain Process Transparency Automatically
- Conformance Checking | Automatically detect deviations. Achieve holistic process governance
- Automated Root Cause Analysis | Identify causes of inefficiencies automatically & quickly.
- Continuous process monitoring & process prediction through artificial intelligence
- Measures and workflow management | Task management for corrective measures
- Value stream design | Definition of new to-be processes and key performance indicator goals
Even complex value streams can be mapped and coordinated at different levels of detail or value stream sections so that you always have everything in view – from the big picture to the details. Sounds exciting? Then why not attending our webinar "Powerful Value Stream Mapping with Process Mining: From snapshot to holistic view ".
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