A value stream is a comprehensive set of actions, both value-creating and non-value-creating, necessary to bring a product or service from its initial concept to its delivery to the customer (Lean.org). Value streams encompass all activities involved in processing customer information and transforming the product or service on its journey to the end-user.
Key Facts
- Value streams are artifacts within business architecture that allow a business to specify the value proposition derived by an external or internal stakeholder from an organization.
- Value streams always begin and end with a customer, and they are usually aligned with company processes.
- Value streams represent end-to-end views on how value is achieved for a given external or internal stakeholder.
- Value streams consist of value stream stages, which are iterative value items that are accrued to deliver value throughout the value stream.
- Value streams are not processes but rather focus on how value is achieved rather than how it’s done.
- Value streams are not internally focused; the goal is to focus on stakeholders outside of an organization.
- Value streams are not customer journey maps; they seek to describe different sets of information.
- Value streams are especially important in agile methodologies, as they provide a foundational view of the business from which agile work can be completed.
Characteristics of Value Streams
Value streams possess several key characteristics:
- Customer-centric: They always begin and end with a customer, whether external or internal to the organization (Wikipedia).
- End-to-end: Value streams provide a holistic view of the entire process, from inception to delivery (VSM Consortium).
- Iterative: They consist of value stream stages, which represent incremental value items that contribute to the overall value proposition (VSM Consortium).
- Aligned with Business Processes: Value streams typically align with the company’s processes and strategic objectives (Lean.org).
Distinguishing Value Streams from Related Concepts
It is crucial to differentiate value streams from similar concepts:
- Processes: Value streams focus on “how value is achieved” rather than “how it’s done” (VSM Consortium).
- Internal Focus: Value streams prioritize external stakeholders rather than internal processes or value chains (VSM Consortium).
- Customer Journey Maps: While both value streams and customer journey maps consider the customer’s perspective, they describe different aspects of the experience (VSM Consortium).
Value Streams in Agile Methodologies
Value streams play a vital role in agile methodologies, such as the Scaled Agile Framework (SAFe). They provide a foundational understanding of the business, enabling agile teams to prioritize and deliver value to customers effectively (SAFe).
Conclusion
Value streams are essential artifacts in business architecture, representing the end-to-end flow of value from concept to delivery. By understanding the concept and characteristics of value streams, organizations can enhance their ability to deliver customer-centric solutions, optimize processes, and achieve business success.
References
- Value Stream – Lean Enterprise Institute
- Value Stream – Wikipedia
- What is a Value Stream? – Value Stream Management Consortium
FAQs
What is a value stream?
A value stream is a comprehensive set of actions, both value-creating and non-value-creating, necessary to bring a product or service from its initial concept to its delivery to the customer.
What are the key characteristics of a value stream?
Value streams are customer-centric, end-to-end, iterative, and aligned with business processes.
How do value streams differ from processes?
Value streams focus on “how value is achieved” rather than “how it’s done.”
Are value streams internally focused?
No, value streams prioritize external stakeholders rather than internal processes or value chains.
How are value streams used in agile methodologies?
Value streams provide a foundational understanding of the business, enabling agile teams to prioritize and deliver value to customers effectively.
What are the benefits of using value streams?
Value streams help organizations enhance their ability to deliver customer-centric solutions, optimize processes, and achieve business success.
How do I identify a value stream?
To identify a value stream, consider the following steps:
- Define the customer and their needs.
- Map out the entire process, from inception to delivery.
- Identify the key activities and dependencies.
- Analyze the flow of value and identify areas for improvement.
How do I improve a value stream?
To improve a value stream, consider the following strategies:
- Eliminate waste and non-value-added activities.
- Optimize the flow of information and materials.
- Reduce lead times and cycle times.
- Improve collaboration and communication between teams.