Understanding Flow Part 2 | Operational Excellence Quick Hits

Speaker 1: (00:05)
When we look at activities that happen within an organization, we can define them as two different types. One is value added. So these are activities that actually transform the product or service one step closer to what the customer’s demanding. There’s also activities that don’t transform that product or service, and we call those non-value added activities. So if I just look at a timeline here, this is what poor flow would look like. Work starts, and it sits in a queue someplace, and then somebody does some activity to it. Then it sits in queue waiting for the next process to do its work. Then it sits in queue and so forth.

Speaker 1: (00:43)
So the green represents the transformation steps, the red represent the non-transformational or queue time. So you can refer to this even to a doctor’s office. [inaudible 00:00:53] that goes into a doctor’s office. I go into the office, and then I go to the check-in clerk and she takes all my information, my insurance card and all that stuff. Then I sit in the waiting room. And then they call me back to go into the exam room, and then they take my blood pressure and weight and all my vitals. And then I sit in that waiting room, which is probably more than this little window here, for a half hour waiting for the doctor to show up.

Speaker 1: (01:19)
The doctor shows up and he spends four minutes with me. And then, “Oh, you might have to take a blood test.” Then I wait in queue to get the blood test. And then they do the test, and then I’m out. Everybody’s experienced that. So this is a real life example to that type of flow. But what we really want is improved flow. So when you come in, you go to the first value added step, very short waiting time. Next value added step, very short waiting time. Next value added step. And the time to complete is cut in half. So the lead time is cut in half, but the value added time didn’t change. Focus isn’t on trying to reduce this value added time. That’s not where the opportunity is. The opportunity is in this queue and waiting time.