Value Stream Analysis - Research Paper Example

?Within the current era, firms are seeking to leverage each and every means possible to evoke a further level of profitability and/or competitivenessfrom their respective business ventures. Throughout the past several decades, an emphasis on outsourcing, economies of scale, customer satisfaction, supply chain management, cash flow, marketing, and a litany of other techniques have been utilized and focused upon as a means of affecting this increase in profitability and/or competitiveness. However, one such approach that has recently been engaged to a great level of success within many firms is with regards to what is termed as “value stream analysis” (VSM). At its simplest definition and most core element of operational ability, VSM is designed as a means to analyze the flow of information and materials that is ultimately responsible for bringing a good or service to the consumer. Due to the very broad range and depth of such a definition, this particular approach is one that seeks to gain a level of inference from a high degree of different inputs and correlate these to the overall ability/profitability/efficiency that a particular business entity reflects. Although aspects of this particular method of analysis have been utilized within other forms of business analysis, value stream analysis is one of the only methods of measure that are able to encapsulate each of these determinants in one simple panel local overview. As a function of seeking to understand value stream analysis to a greater degree, the following essay will discuss what typically defines the value stream analysis, the means of application, when they should be utilized, why they should be utilized, the in effects of utilizing value stream management within a given corporation/business entity the results of utilizing value stream management, and the overflow impacts in comparison to other strategies that might exist as compared to values stream analysis within the business environment. As a function of this level of analysis, it is the hope of this author that the reader will come to a more profound and actionable appreciation for the fact that this particular approach is both useful and efficient in helping to define and differentiate some of the core strategies that should be approached with regards to ensuring that a profitable, efficient, and realistic scheme of inputs is utilized to bring the product to the consumer market. One of the first steps in seeking to utilize value stream analysis as an actionable way to improve efficiency and/or profitability that a given business entity can promote to the end consumer is by targeting the actual product/product lines/or business unit that will be responsible for tabulating and considering these inputs. Not only is this ineffective in accomplishing any particular goal, it reduces the importance and/or relevance of the information that it is capable of providing. This is obviously due to the fact that an overarching level of analysis of a given business entity provides an ineffective basis by which business decisions and key input utility can be inferred (Bevilacqua et al, 2008). A secondary component of value stream analysis that is oftentimes overlooked is with respect to the fact that it must necessarily be performed at the lowest level of the firm; at the point where the basic inputs come into the business entity and are processed in one way or another in preparation to create the final product or service to provide the end consumer. Thirdly, once these inputs have been tabulated and understood, the current situation must be analyzed so that any existing waste or ineffective procedures can be trimmed. Fourthly, the step that oftentimes poses the greatest level of difficulty for the firm or business entity that seeks to integrate with such a process is with regards to seeking to improve upon the weaknesses or inefficiencies that have thus far been noted. Once this is understood and effected, the fifth and final step is to implement these and work towards future profitability and efficiency; being forever cognizant of the fact that value stream analysis is not a once a decade or even once a year process. Instead, it is an ongoing process of quality management that must be engaged consistently as a means of helping to reduce waste and help to keep the firm or business entity relevant. Ultimately, the effects of this particular approach speak for themselves, due to the fact that a given firm and/or business entity is able to view the value stream for all of its compounded parts, key elements of inefficiency are able to be denoted and reduced if this process is affected according to the five-step plan laid out previously within this analysis. Engaging in many of the compliment parts of value stream analysis necessarily takes a great deal of time and reduces the efficiency of the firm if engaged to heavily. What is meant by this is that many compliments of the value stream analysis exist in and of themselves and are facilitated various junctures throughout the business process; albeit named differently. Within such an understanding, it can become clear to the reader that value stream analysis is particularly affected is due to the fact that it is able to combine many of these disparate methods of analysis and place them within one easy to utilize approach. Likewise, it is the further belief of this analysis that value stream analysis provides one of the most actionable and wholly effective strategies that can be implemented with regards to the inputs that a firm integrates with. Ultimately, research into this topic helps to solidify the understanding that this particular strategy of value stream analysis and its integration necessarily increases profitability and the overall level of competitiveness that a given firm can exhibit within the market. However, just as with any level of analysis and understanding within the business world, value stream analysis is not a panacea for any and all problems that might exist within a given firm; even with regards to input issues and waste reduction (Serrano et al, 2008). As with any business strategy and/or approach, value stream analysis exhibits a number of key shortcomings. The first of these is with respect to the fact that effective value stream analysis necessarily requires a relatively high cost and the designation of key personnel to focus upon this aspect of business management alone. Within such a way, it is a highly effective approach for firms such as Toyota, the entity that pioneered this particular technique, as well as other extraordinarily large and highly successful business entities. In such a way, value stream analysis can ultimately be understood as a type of metric that is specifically designated to particular business entities that are both complex and have requisite resources to engage in such a unit of analysis with regards to the inputs that they seek to provide as a function of completing a final project for sale to the end consumer. However, it cannot be said to be the solution for waste and input management for the very small firm. Although key aspects of value stream management can no doubt be made available and effectively impacts upon the overall level of waste reduction of profitability for a small firm, the plan as a whole cannot be implemented due to the fact that it would require and exorbitantly high cost and the reduction of overall productivity within the firm during the very time in which value stream analysis is taking place. Naturally, it can be implemented to a lesser degree and by fewer staff member; however, the results of such an analysis and approach are debated by current and existing literature. A further aspect that should be considered, although it cannot be considered as a unique drawback to using value stream analysis, is with respect to the overall complexity of the business and seek in which it is engaged. In order for value stream analysis to work in the way that it was designed, it should necessarily be implemented within a relatively or at least moderately complex business entity (Bevilacqua et al., 2008). In such a way, for the business entity that is smaller and/or less complex, many other forms of input analysis exist that represents a more efficient utilization of employee time and business resources than does the value stream analysis. Regardless of the shortcomings that value stream analysis has been proven to exhibit, it nonetheless retains a clear level of value for an existing firm that seeks to reduce waste and promote an increase level of profitability and competitiveness within the current market. Whereas competition and cost reduction are key ways that guarantee the survival of the firm into the future, value stream analysis helps the firm/business entity in question promote this fundamental as the ultimate basis for integration with such an approach. Although it should not be understood by you stream analysis should be placed ahead of many of the other strategies that were referenced within the introduction, it is a complementary strategy that, if a firm is able to engage, can provide a clear and noticeable benefit that can assist it in continuing to provide lower-cost and more efficient, as well as higher quality, goods and/or services to the end consumer. References Barber, C, & Tietje, B 2008, 'A research agenda for value stream mapping the sales process', Journal Of Personal Selling & Sales Management, 28, 2, pp. 155-165, Business Source Complete, EBSCOhost, viewed 26 July 2013. Bevilacqua, M, Ciarapica, F, & Giacchetta, G 2008, 'Value stream mapping in project management: A case study', Project Management Journal, 39, 3, pp. 110-124, Business Source Complete, EBSCOhost, viewed 26 July 2013. Serrano, I, Ochoa, C, & Castro, R 2008, 'Evaluation of value stream mapping in manufacturing system redesign', International Journal Of Production Research, 46, 16, pp. 4409-4430, Business Source Complete, EBSCOhost, viewed 26 July 2013. Read More