Critical administrative functions can have just as many opportunities for improvement as manufacturing and service operations.
Modern Machine Shop,
From the monthly column: Competing Ideas
Value-stream mapping is an excellent means of identifying waste in any type of process. Manufacturers frequently use this technique to streamline operations and reduce product throughput time. Service industries use it to cut wasteful, repetitive steps that often cause delays. Value-stream mapping also can be effective when evaluating a company’s administrative functions.
To begin mapping an administrative function, select a starting point and ending point, then list all major processes that occur between those two points. Examples of starting points include requests for information, pricing, services and purchase-order receipts. Examples of ending points include releasing a work order to manufacturing, generating a service or repair order, and placing a purchase order with a supplier. The tasks and hand-offs that take place between the selected starting and ending points are the processes that will be reviewed during value-stream mapping. The number of defined processes will vary depending on the complexity of the administrative function.
To begin, determine the critical information that needs to be collected for each item on the process list. Be sure to include the following information for value-stream mapping an administrative function:
• Process time. This is the time it takes to complete the task if there are no interruptions or delays. Some refer to this as “hands-on time” or “touch time.” It is important to remember that this is the time that meaningful work is being performed.
• Elapsed time. This is the overall time it takes to finish the individual process. Elapsed time includes the process time, pre-process delays and process interruptions. Some look at elapsed time as “inbox-to-outbox” time or the total time spent on a process.
• Process quality metrics. These are ways to measure the quality of a specific process. One option is measuring first-pass yield, which is the percentage of time that the process is completed correctly on the first pass. This quality metric measures the process itself. Another option is percent complete and accurate, which is the percentage of time that the process has everything needed to start and finish. This quality metric measures the effectiveness of prior operations. It shows the impact of deficient upstream processes. Another quality-metric option is calculating the percentage of process time spent on rework or revisions. Each of these metrics illustrates how quality problems affect resources.
Other data that can be useful for evaluating administrative functions include:
• Downtime. This includes system or equipment downtime issues that prevent processes from being completed in a timely fashion. Downtime is represented as a percentage of available time. It reflects another constraint on process output.
• Number of trained resources. This is the number of resources available to complete a process. The larger the number, the greater the likelihood that someone is available when needed. A limited number of trained resources increases the likelihood of “resource competition,” which can delay the start of any process.
• Batch size and frequency. Sometimes processes are completed only at certain times of the day or when there is enough work to justify starting a process. Mail delivery is an example of a process that may be done only once a day, resulting in a daily batch frequency. On the other hand, a decision may be made to staff a process only when there are five orders to complete, resulting in a batch size of five.
• Process change-over time. Although significant change-over time is unusual for an administrative process, it may have to be accounted for if the process requires access to software or office equipment that must be prepared for use.
Once all the required information is collected for each process, it is time to create the “current state” value-stream map. This map shows the relationship between value-added time and non-value-added time in the administrative function being reviewed. The sum of all individual process times serves as the measure of value-added time, while the sum of all individual process elapsed times serves as the measure of non-value-added time. The difference between these two times represents the amount of waste resident in the administrative function—the greater the difference, the greater the opportunity for improvement.
Although improvement can be realized only when we take advantage of the opportunities presented, value-stream mapping has proven to be an effective technique for discovering those opportunities everywhere in an organization.
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