VALUE STREAM MAPPING IN MANUFACTURING SECTOR
Compiled & Edited by
ARINDAM SAIN
Abstract
Value stream mapping is used to find out the differences between value added and non-value added activities within the process. These VSM tools are used in the engineering processes, wherever applicable, to find out the reason for delays/waiting time happening within the value-added activities. These delay time does not provide any value to the process. So, these time are non value-added.
Whether an activity is adding any value or not, to a process, is determined by asking the questions: -
Is there any form, information or content-level change in the activity?
Is it providing any advantage to satisfy the customer in the next stage?
After getting the total time of the value-added and non-value added activities of the process, Value Added Ratio (VAR) is calculated.
VAR is a ratio calculation of ((Total value-added time) / (Total value-added time + Total non value-added time)). Toyota has a VAR of 22, which is a benchmark/standard.
The goal of this project is to find out, where the VAR of all the engineering processes stand, in respect to Toyota. Motive of the project is to suggest or implement the opportunities; in such a fashion that VAR improves as well as the current state of the processes reaches a future state, which is ideal in nature.
The scope of improvement relies on the effective utilization of opportunities. This kind of utilization is represented by kaizen bursts. The ideal future state is reached by doing check & combine, automation, reengineering and standardization of processes.
During standardization, some non value-added activities are totally eliminated. There are some non-value added activities, which cannot be totally eliminated, but can only be reduced.
Reasons for delay are cross-examined in detailed fashion, to standardize or reduce the delay to a maximum possible extent.
Suggestions or opportunities, which can improve the VAR, can only be implemented, if it is found to be feasible for the company, and the customers are willing to pay for that extra cost.
In engineering processes, the delay occurs due to the lack of responsiveness to complete the work within the deadlines and for too much of redundant manual flow of information. Some manual activities can be easily standardized through SAP R/3.
Introduction
The project is about Value Stream Mapping (VSM) of all engineering process in a manufacturing company. Using VSM tools, the VAR of each process is calculated. Reasons for Non Value Added (NVA) time are identified and for eliminating or reducing those times, suggestions are made.
Out of all engineering processes, VSM tools are applied to the following processes: -
Service order/PWKC process
Purchase order process
Vendor registration process
Write-Off process
Labor entry process
Capex approval & execution process
For every process, current state value stream diagrams are drawn, to find out current total NVA and VA. Then current VAR is calculated.
After calculating the current state VAR, emphasis is given to the opportunities, which can improve the future state VAR.
Now, the future state value stream diagrams are drawn, with kaizen bursts within the activities, wherever possible, with the opportunistic suggestions abiding by the feasible and applicable principle of the company.
Due to limited scope of this project, kaizen bursts are made on two-step approach: - Check and Combine, Standardization.
The reasons for the delay between the activities are noted down with proper NVA symbols and explanations. This will help to eradicate any kind of similar situations of delay in future. So, standardization and automation of processes will be faster to reach a future state, which is very near to the ideal state.
Rate of improvement of VAR for each processes are calculated. Based on that, it is identified, how much customer satisfaction level has increased.
Those processes, which are tracked for at least 10 to 15 times, their average total VA and average total NVA, are taken to calculate the average VAR. The NVA and VA are calculated in hours.
The target of the project is to increase the VAR by at least 50-60% within 3 to 6 months, abiding by the Pareto principle.
PROCESS BRIEFINGS
Service order/PWKC process has been divided into two parts: -
- Service order/PWKC release process
- Service order/PWKC e-billing process
Purchase order process has been divided into two parts: -
- Purchase order release process
- Purchase order billing process
Write-Off process has been divided into two parts: -
- Write-Off approval process
- Write-Off disposal process
Labor entry process has been divided into two parts: -
- Labor entry process for temporary contractors
- Labor entry process for regular contractors
Capex approval and execution process takes place once/twice in a year, based on the requirement of the ITC factory – Kidderpore.
New vendor registration process takes place, only when a specialist is required for completing a special job.
Write-Off process approval and disposal takes place twice a year.
Labor entry process for regular contractors takes place very frequently. Labor entry process for temporary contractors takes very long time, due to HR checking and non ITC PFESI checking.
Service order and purchase order processes are the most happening process in the engineering department. PWKC e-billing and purchase order billing are done through SAP R/3.
SERVICE ORDER/PWKC RELEASE PROCESS
Background:
In Service order/PWKC release process, the ability to release the service order within the standard time is unsatisfactory, i.e. customer satisfaction is only 42%. Customers can save around 60% time, by reducing the quotation processing time and the signature process time from assistant branch engineer to branch manager.
Current situation:
1) Time required to complete all value added processes is at an average of 22 minutes / 0.366 hours.
2) Delay time for non-value added processes are 85.55 hours.
3) Total lead-time of the process is 85.916 hours and VAR is 0.43.
Problem analysis:
1) Quotation processing time is too long.
2) Quotation is received after a long period of time, after the request has been made.
3) The whole signature process of service order is a lengthy and redundant process.
Goals:
1) The customer satisfaction can be increased by 55%.
2) Reduction of non-value added time by around 65%.
3) Increasing VAR by 70%.
Recommendations/Suggestions:
1) More profit will be given to those suppliers, who will submit the quotation within specified days.
A standard market price list of all products and services to be updated and circulated in every 6 months.
3) Standardization that the Engineering Department should start checking the quotation within 1 hour.
4) Standardization that signature should be done within 8 hours, after receiving it.
Improvement scope:
- If all the suggestions are implemented, then value added ratio (VAR) increases from 0.43 to 0.92.
- Rate of improvement of VAR is 113.95%.
Service order/PWKC release process (Ideal State)
Strategies:
To reach an ideal state, certain strategies are taken: -
1. Listing of services that are essential and done frequently in the factory.
2. Making a category/type list of all essential services.
3. Enlisting top four vendors for each services, based on their past performances.
4. Fixing a price-rate list of all the services for at least 6 months, for each vendor, by one-time negotiation.
5. Within 6 months, if market price of services and materials increases/decreases by 20%, then service rates will be increased/reduced by certain negotiable amount.
6. Vendors can only use the permissible branded materials for doing the services. e.g. No vendor can use paints other than Asian Paints or Berger.
7. Negotiated price rates will vary according to the materials used. A price list for that will be kept beforehand. e.g. A vendor using Lafarge cement will have more service charge than the vendor using ACC cement.
8. Engineering department will take the decision for assignment of jobs.
9. After job assignment, Building Supervisor will enter the price or service rates, for that vendor, from the list available beforehand.
10. Service orders are generated and notification goes to ABE, by VB module.
11. ABE approves service order by a single-click, and BE gets notification.
12. BE approves service order by a single-click, and CM gets notification.
13. CM approves service order by a single-click, and BM gets notification.
14. BM approves service order by a single-click, and BS gets notification.
15. BS takes out the final printout and dispatches to vendor.
16. All message notifications will be given through POP-UP screen.
Improvement scope:
- By implementing this, Value Added Ratio (VAR) for PWKC release process improves from 0.43 to 25.928.
SERVICE ORDER/PWKC E-BILLING PROCESS
Background:
In service order/PWKC E-billing, the ability to deliver the service order e-bills to commercial department is currently low i.e. customer satisfaction is only 45%. Customers can save around 40% time, by reducing delay in inspection time and the entire signing process of inspection report by building supervisor and branch engineer.
Current situation:
1) Time required to complete all value added processes is at an average of 27 minutes / 0.45 hours.
2) Total delay time for non-value added processes are 34.89 hours.
3) Total lead-time of the process is 35.34 hours and VAR is 1.27.
Problem analysis:
1) Inspection time is too long. Building supervisor has to run after the contractors, for checking, whether they have followed all the norms of safety, quality and brand of materials used, while completing the job.
2) The building supervisor, for sending the approved inspection report and getting it signed by branch engineer, takes too much time.
3) Management does not have a strict rule or a standard deadline, that an inspection report will get signed within a certain specified duration of time.
Goals:
1) Improving the customer satisfaction by 45%.
2) Reducing all non-value added time by at least 50%.
3) Increasing value added ratio (VAR) by 65%.
Recommendations/Suggestions:
1) Inspection of permissible branded materials to be done at the Gate House. A list of permissible branded materials will be displayed at the Gate office.
2) BS to send the order within 1 hour follows a standardized timing/schedule.
A management set a rule that E-bills should be generated within 30 minutes, from the time branch engineer has signed.
Improvement scope:
- If all the suggestions are implemented, then value added ratio (VAR) increases from 1.27 to 3.14.
- Rate of improvement of VAR is 147.24%.
Service order/PWKC e-billing process (Ideal State)
Strategies:
1. To reach an ideal state, certain strategies are taken: -
2. A list to be displayed at the gatehouse, where name of all permissible branded materials will be given.
3. Whenever, any materials come at the gatehouse, only those will be permitted, which are enlisted beforehand in the displayed list.
4. A software module created in VB 6.0, from where bill documents can be sent to the Assistant Branch Engineer, by a single-click.
- Assistant Branch Engineer gets pop-up notification message and then approves the bill documents, by a single-click.
- Assistant Section ‘A’ officer gets a pop-up notification message for pending bill documents and then approves those documents by a single-click. E-bills are generated.
- Printouts of e-bills are taken, where digitized signatures are printed.
- E-bills are now dispatched to vendors.
Improvement scope:
- By implementing this, Value Added Ratio (VAR) for PWKC e-billing process improves from 1.27 to 12.40.
- Rate of improvement of VAR is 876.37%.
PURCHASE ORDER RELEASE PROCESS
Background:
In Purchase order release process, the ability to release the purchase order is low, i.e. customer satisfaction is 38%. Customer can save around 55% time, by reducing quotation receiving, quotation processing, and purchase indent generation and signature process by CM & BM.
Current situation:
1) Time required to complete all value added processes is at an average of 26 minutes / 0.43 hours.
2) Total delay time for non-value added processes are 125.23 hours.
3) Total lead-time of the process is 125.66 hours and VAR is 0.34.
Problem analysis:
1) Quotation is received after a long period of time, after the request has been made.
2) Quotation remains in the office for many hours, before it is taken up for processing.
3) Signature process of purchase order takes too much time.
4) Making of Logic notes and its signing is redundant in nature.
Goals:
1) The customer satisfaction to be increased by 40%.
2) Non-value added time to be reduced by 60%.
3) Elimination of Logic Notes process, if it does not provide any value addition.
4) Increasing VAR by 75%.
Recommendations/Suggestions:
- More profit will be given to those suppliers, who will submit the quotation within specified days.
2. A standard market price list of all products that will be purchased should be available before hand.
3. Logic Notes does not provide extra value addition. But still, a rule to be set to make logic notes within 8 hours.
4. Management standardizes the rule that Purchase Order signature should be done within 8 hours, after receiving it.
Improvement scope:
1. If all the suggestions are implemented, then value added ratio (VAR) increases from 0.34 to 0.62.
2. Rate of improvement of VAR by 82.35%.
PURCHASE ORDER BILLING PROCESS
Background:
In purchase order billing process, the ability to make bills and clearing out the payment is just satisfactory. Customer satisfaction is around 66%. Customer can save around 35% time, by reducing challan-processing/signing time in engineering department, reducing document receiving time and the payment giving time in the commercial department, after the Goods receipt in the engineering stores.
Current situation:
1. Time required to complete all value added processes is at an average of 19.66 minutes / 0.327 hours.
- Total delay time for non-value added processes are 23.444 hours.
- Total lead-time of the process is 23.771 hours and VAR is 1.37.
Ideal Situation
- Stamped challan from the gatehouse reaches the engineering department, very quickly. But, the challan remains in a waiting state for a long time, to get processed or signed by the assistant branch engineer.
- After goods receipt entry in SAP R/3, at the engineering stores, the document remains in that office for a long time, before it is sent to the commercial department.
- Commercial department takes a long time in making the payment to the supplier.
Goals:
1. Increasing customer satisfaction by at least 60%.
2. Non-value added time to be reduced by 70%.
3. Improving Value Added Ratio (VAR) by 50%.
Recommendations/Suggestions:
- Standardization that challan should be processed within 2 hours, from the time of the challan stamped and approved at the gatehouse.
- Standardization that Goods receipt entry to be done within 8 hours, from the time of goods entry at gatehouse.
- Standardization that after goods receipt entry in SAP R/3 at the engineering stores, the Commercial department should receive the document within 2 hours.
- The commercial department should make the payment, within 5 hours, from the time of receiving the document of challan and goods receipt.
Improvement scope:
- If all the suggestions are implemented, then VAR improves from 1.37 to 2.78.
- Rate of improvement of VAR is 102.91%.
Write-Off approval process
Background:
Write-Off approval process takes place once or twice in a year. External buyers are the customers and user/concerned department are the suppliers. The process gets delayed due to the discussions that happens between the user, engineering and commercial department and for the long time taken by the Head Office to clear the Write-Off request and due to laziness of the external buyers.
Current situation:
1. Time required to complete all value added processes is at an average of 50 minutes / 0.833 hours.
- Total delay times for non-value added processes are 175.223 hours.
- Total lead-time of the process is 176.056 hours and VAR is 0.473.
Ideal situation
1) The discussion for the Write-Off materials between the users, engineering and commercial department takes a very long time.
2) External buyers delay in submitting the rate and depositing money or making payment on time.
Goals:
1. The customer satisfaction to be increased by at least 60%.
2. Reduction of non-value added time by around 45%.
3. Increasing VAR by 70%.
Recommendations/Suggestions:
1. The entire discussion process is to be eliminated. During Write-Off request, there should be an attached document, stating the reason for scraping the materials. This document should flow from the start to end of the process.
2. Standardization that the external buyers should submit the rate within 8 hours, from the time the listing of materials done by Engineering Department.
3. Standardization that the external buyers should deposit money or make payment within 8 hours, after the rate has been validated.
Improvement scope:
1. If all the suggestions are implemented, then value added ratio (VAR) increases from 0.473 to 0.83.
2. Rate of improvement is 75.48%.
Write-Off disposal process
Background:
Write-Off disposal takes place after its approval. The process gets delayed due to late signing at gate, more time taken in checking the photos of broken Write-Off materials, and truck unloading.
Current situation:
1. Time required to complete all value added processes is at an average of 30 minutes / 0.5 hours.
- Total delay times for non-value added processes are 26.902 hours.
- Total lead-time of the process is 27.402 hours and VAR is 1.82.
Problem analysis:
- Signing of Pass at the gate takes a longer time, than it is expected.
- Commercial Department takes more time in checking the photos of broken materials.
- Truck on loading takes place after a long delay, once the commercial department checks the photographs of broken materials.
Goals:
1. The customer satisfaction to be increased by at least 20%.
2. Reduction of non-value added time by around 25%.
3. Increasing VAR by 40%.
Recommendations/Suggestions:
1. Standardization that signing at gate to be done within 1 hour, from the time, the pass has been checked.
2. Photos of broken materials should be checked within 1 hour, by the Commercial Department.
3. Standardization that the truck on loading to be completed within 1 hour, after the Commercial Department checks all photos.
Improvement scope:
1. If all the suggestions are implemented, then value added ratio (VAR) increases from 1.82 to 5.26.
2. Rate of improvement is 189.01%.
Background:
In labor entry process for temporary contractors, the ability to give permission to labors is delayed due to the errors in submitting the PF and ESI documents. The document collection, sometimes take too much time. Due to unavailability of HR managers, the document signing process is delayed, and hence the permit entry of labors.
Current situation:
1. Time required to complete all value added processes is at an average of 13 minutes / 0.2167 hours.
- Total delay time for non-value added processes are 36.50 hours.
- Total lead-time of the process is 36.7167 hours and VAR is 0.59.
Problem analysis:
1. The incorrect PF and ESI documents submission takes place frequently.
2. Correction and re-submission of PF and ESI documents, delays the actual document collection time.
3. Busy schedules and unavailability of HRM and Assistant HR managers, delays the checking and signing process of the PF & ESI documents.
Goals:
1. The customer satisfaction to be increased by 75%.
2. Reduction of non-value added time by around 85%.
3. Increasing VAR by 90%.
Recommendations/Suggestions:
1. A software module in Visual Basic 6.0 can be prepared, where Building Supervisor can fill labor entry request form, and sending it to the HR secretary, by a single-click.
2. A notification pops up in the HR secretaries’ PC screen, and then he/she forwards the report soft copy to the available HR manager, for approving it by a single-clicking the “HR approved” button.
3. A message pops up on the gatehouse screen, that HR has approved that PF & ESI report. Automatically, the labor entry permission is given.
4. The Hard-Copy PF & ESI document with contribution challan can come, after the permission has been given, by viewing the HR approval, through that software module.
Improvement scope:
· If all the suggestions are implemented, then value added ratio (VAR) increases from 0.59 to 15.88.
Capex approval & execution process
Background:
Capex approval & execution process takes place, only when the user/concerned department undertake a project. The process gets delayed due to long processing time taken by the Head Office to approve/clear the request. Too much vendor follow-up, price negotiation delays the purchase order requisition generation date. Material supply and service completion takes place beyond the delivery dates.
Current situation:
1. Time required to complete all value added processes is at an average of 89.07 minutes / 1.48 hours.
- Total delay time for non-value added processes are 1920.87 hours.
- Total lead-time of the process is 1922.35 hours and VAR is 0.076.
Problem analysis:
1. PS is sent to HO, after a long time and its approval for IO number generation also takes too much time.
2. Delay happens in making the purchase requisitions for vendor supply materials.
3. Materials are supplied, after a long time delay, with respect to the desired delivery date.
4. Services are not completed within the desired completion date. Delay of 1-week remains.
Goals:
1. The customer satisfaction to be increased by 80%.
2. Reduction of non-value added time by around 65%.
3. Increasing VAR by 55%.
Recommendations/Suggestions:
1. PS should be sent to HO within 1 month, after the project selection date.
2. HO should approve the PS within 1 month.
3. Purchase requisition for vendor supply to be made within 1 month of IO generation.
4. Supply orders to be generated within 1 day, after the requisition made.
5. Maximum 7 days delay for material supply
6. Maximum 1-day delay for service jobs.
Improvement scope:
· If all the suggestions are implemented, then value added ratio (VAR) increases from 0.076 to 0.21.
· Rate of improvement of Value Added Ratio (VAR) is 176.32%.
Vendor registration process
Background:
Vendor registration processes takes place very rarely, in a year, and are less in number. The customer is the vendor. The process gets delayed due to the incorrect filling of the vendor registration form, and due to the correction processing in EHS and commercial department.
Current situation:
1. Time required to complete all value added processes is at an average of 22 minutes / 0.366 hours.
- Total delay time for non-value added processes are 83.75 hours.
- Total lead-time of the process is 84.116 hours and VAR is 0.43.
Problem analysis:
1) The vendor registration form is very lengthy in nature, i.e. about 30 pages.
2) The vendors’ fills up the registration form incorrectly. In many cases, they cannot understand the environment, health and safety related questions. This results in delays of EHS checking and signing process.
3) Many a times, the vendors do not submit the “Authorized dealer certificates” or any authorization report from any supporting vendors.
4) Form checking in commercial department takes time, because the vendors do not provide the purpose for registering with the company. Either, we need that vendor or not, whether any competitor is there or not, this kind of checking gets delayed.
Goals:
1. The customer satisfaction to be increased by at least 40%.
2. Reduction of non-value added time by around 35%.
3. Increasing VAR by 60%.
Recommendations/Suggestions:
1. The vendor registration form can be made user-friendlier and the number of pages can be reduced. This will help in reducing the confusions and errors, while filling the form.
2. Standardization that “Authorized dealer certificate” or authorization report by some supporting vendor should be submitted, in attachment with the filled-up vendor registration form.
3. Purpose for registering the vendor, should be clearly mentioned. It is mandatory; otherwise commercial department will not sign the form.
4. If everything, regarding the formalities in the form is all right, then standardization has to be made that EHS and commercial checking and signing ends within 2 days and entry in SAP R/3 within 8 hours.
Improvement scope:
· If all the suggestions are implemented, then value added ratio (VAR) increases from 0.43 to 1.11. Rate of improvement is 158.13%.
Conclusions / Recommendations
1) Automation of Service Order / PWKC release process can be done by running software made in VB 6.0. Temporary labor entry will be done also by single-click.
2) Selecting the top 4 vendors for each service can be done, based on their performances in the past.
3) Service rates for each vendor can be fixed for 6 months, by one-time negotiation.
4) Service rates are liable to vary according to the type of branded materials used.
5) No vendors will be allowed to use materials other than the permissible branded materials listed at the factory gatehouse.
6) A list of permissible branded materials will remain displayed at the gatehouse. Gatehouse will permit only those branded materials.
7) All registered vendors and essential services are to be codified in SAP R/3, for faster transactions.
8) Every registered vendor should have a valid email id and office address.
9) Vendor registration form should be made user-friendlier.
10) For DI items, all purchased items should get codified in SAP R/3, for eliminating the need of purchase order in future, for buying the same item.
11) Making of Logic Notes should be avoided as much as possible. Logic Notes should get processed within 8 hours, of its generation.
12) Contractors, who are unable to renew the contribution challan of their labors, within 2 days, will not be given permit entry to the factory for 1 month.
13) For Capex projects, a proper project management plan should be made, with the deadline dates for each sub processes.
14) The Commercial Department should make the Profitability Statement, within 1 month, from the time of its project selection date.
15) Discussion time for Write-Off should not exceed 1 week.
16) A software to be made in VB 6.0, which will bring visibility in the daily working performance of each worker. At the end of the day, the system will track, how much percentage of work delivered, out of the assigned work/job.
17) Goods receipt entry for service or supply, should be done within that day or 8 hours, from the time when the service/job gets completed, or the materials enter the factory.
18) Supply of materials date should not exceed by 7 days, from the supply delivery date and service completion date should not exceed by 2 days, from the job completion date.
19) Engineering & Commercial should be nearer, reducing document-flow delay.
GLOSSARY
1) ABE: - Assistant Branch Engineer. In absence of BE, he/she signs or approves all quotations.
2) ACM: - Assistant Commercial Manager. In absence of CM, he/she signs or approves all PO.
3) BE: - Branch Engineer. He/she is the Head of the Engineering Department.
4) BM: - Branch Manager. He/she is the Head of all HODs. That is, the boss of the factory. BM takes the ultimate decision for anything related to the factory.
5) BS: - Building Supervisor. He/she is responsible for supervising all types of services. BS generates service orders and also keeps records of all completed orders.
6) Capitalization date: - The planned date for completing a Capex project.
7) Capex: - Capital expenses. The expenses are done for replacement, modernization projects.
8) CM: - Commercial Manager. He/she is the Head of the Commercial Department.
9) CTS godown: - CTS means Cut Tobacco Stores. Write-Off materials are broken here.
10) Delivery date: - The date at which the ordered materials are to be delivered.
11) E-bills: - Bills for the service orders that are generated electronically through SAP R/3.
12) EHS: - It is a safety & quality management. EHS stands for Environment, Health and Safety.
13) GR entry: - GR means Goods Receipt. When the ABE approves materials coming inside the factory, then Engineering Stores does the goods receipt entry in SAP R/3.
14) HO: - HO stands for Head Office. It is known as Virginia House. Located at Kolkata.
15) Inspection report: - After job inspection, BS generates a report, known as Inspection report.
16) Installation: - It means putting the machine to work.
17) IO number: - It is the input-output number. Under this unique number, a Capex project is undertaken. The project has to be completed within the allocated budget, sanctioned under that IO number.
18) Kaizen bursts: - It is a sparkling/burst type icon. This icon is used to denote or describe the opportunities or the scope for improvement in a process.
19) Lead-time: - It means the total time taken for completing an entire process. Both value added and non-value added times are taken.
20) Logic notes: - For service orders having the price more than Rs.10, 000/-, a separate document is maintained in the Engineering Department. This is known as Logic notes. This document contains the information about configuration of labors, background & justification for doing a service, financial implications, technical details, cost analysis, vendor selection, rate justification, budget heads and recommendations.
21) NVA: - Non-value added time. The delay time or queue time, that does not add any value to the process.
22) Pareto Principle: - It is an 80-20 principle. 20% of the resources constitute 80% of the total value, and vice-versa.
23) PF-ESI: - It is a document for the labors, related to their provident fund and Employees Social Income.
24) Protocol run: - Running the machines for some period on a testing basis.
25) PS: - PS stands for Profitability Statement. PS is made to propose how much profitable a capex project can become for the ITC factory.
26) Put-to-use: - When a capex project is completed and the machines are permanently sanctioned in the factory, then it is known as “Put-to-use”.
27) PWKC: - PWKC stands for PT work content. It is related to all the documents used regarding a service.
28) SAP R/3: - An ERP (Enterprise Resource Planning) software used throughout the ITC factory. Each and every department uses its own modules only.
29) Service orders: - These are the orders that are generated for making any service.
30) Software module: - An application program made in some languages like VB 6.0 or VB.NET. These application programs run on the client-server computers, to serve certain objectives.
31) Standard market price-list: - Rate list of all the services that are up-to date in the market.
32) Supply orders: - These are the orders that are made for purchasing any items like machines, materials, etc.
33) Token collection: - During labor entry, each labors are given a token. Each labor has to collect those tokens from the gatehouse, before entering into the factory.
34) VA: - VA stands for Value added time. This is the time taken, when some kind of value gets added to the process.
35) VAR: - VAR stands for Value Added Ratio. It is the calculative tool of VSM. It is calculated in percentage. Total VA time is divided by the total lead-time and then 100, to get the VAR, multiply the answer.
36) VSM: - VSM stands for Value Stream Mapping. Value Stream mapping means tracking of processes to find out the value added time and the non-value added time. It helps an organization to analyze, where it stands as per the customer satisfaction and process efficiency. VSM gives a vision for implementation of a least waste, delay or non-value added time process for the future, which will nearer to the ideal state.
REFERENCES
FLAME TAO Knoware Private Limited à www.taoknoware.com
Gemba Research Centre à www.gemba.com
Simpler Corporation à www.simpler.com
SMART group à www.smartgroup.com
“Learning to see” by Mike Rother and John Shook
The Lean Institute à www.lean.org
GOAL/QPC à www.goalgpc.com
“The Lean Enterprise” by Memory Jogger
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