Optimize for flow of value
A value stream is the primary construct for understanding, organizing, and delivering value, each value stream is a long-lived series of steps used to create value—from concept to the delivery of a tangible result for the customer. Like any well-constructed narrative, the Value Stream identifies a chronological flow of activities through the system.
Trigger – Some important event triggers the flow of value, perhaps a customer purchase order or new feature request. It ends when some value—a shipment, customer purchase, or solution deployment—has been delivered.
Steps – The steps the enterprise uses to accomplish this feat.
People and systems – A value stream also contains the people who do the work, the systems they operate, and the flow of information and materials.
Lead time – The time from the trigger to the delivery of value is the lead time. Shortening the lead time reduces the time to market. The easiest way to shorten lead time is to identify and reduce (or remove) non-value added activities and wasteful delays. That’s the primary focus of Lean thinking.
Identify Operational Value Streams
For some organizations, identifying operational value streams is easy. Many are just the products, services, or solutions that the company develops and sells. In the larger enterprise, however, the task is more complicated. Value flows through various applications, systems, and services—across many parts of the distributed organization—to both internal and external customers. In these cases, identifying operational value streams is an essential analytical activity.