I can imagine that some of you are now thinking: “well, come and have a look, our company is not really an amusement park!” And yet, there are commonalities.
Indeed, if you look at the typical process in an amusement park, the characteristics are: you stand in line waiting to go on an attraction for about 20 to 60 minutes, or even longer than that. When you finally enter the attraction, you enjoy a ride during which you tumble, fall or get wet. This treat last about 1 or 2 minutes. Then you continue your journey and head for the next attraction: again you wait in line for ½ to 1 hour, and enjoy the next ride during 1 minute, and so on.
This is the same kind of process that is going on in many production companies: products are waiting in inventory during hours or days, are then being given a value added activity during some minutes (or even seconds), after which the transformed product is put in inventory during several days, waiting for the next activity, which again takes some seconds or minutes, etc.
This leads to staggering statistics: the percentage value added time compared to the total throughput time (from customer order to shipped product) is only 5 to 10 % (and quite often even less).
The strange thing is that, in order to strive to better productivity and shorter lead times, companies tend to spend a lot of attention and money in an attempt to speed up the production activities. By investing in better tooling or equipment, in automation, … they hope to improve their overall performance.
However, if managers would observe the times the products are waiting in inventory, there are much more opportunities for improvement: do the inventory levels have to be that high? Can we reduce work in process?
By concentrating improvement projects on the elements that reduce the “non value added” time, companies can achieve much bigger improvements in reduction of throughput times.
Value Stream Mapping is an ideal technique to give you more insight in the best options for improvement.
And hopefully, another common element between your company and an amusement park, is that you go home in the evening with a very happy feeling.
Author: Dirk Roelens, Partner CIMCIL