It’s likely you’ve heard the term “Value Stream” tossed around quite a bit without much context or definition. This is a shame, as creating greater efficiency without understanding an organization’s value streams is likely to result in decreased efficiency.
A value stream consists of all the steps or processes an organization goes through to deliver a product or service to the customer. But, it should go further than that. It should describe all the activities an organization does to create value for customers and other stakeholders. This includes all the activities done to develop, market, sell, deliver, and support the product outside of product creation, like manufacturing. After all, if a customer never hears of a product or can’t take delivery of it, it never creates value for them.
A product’s value stream provides an opportunity for organizations to identify inefficiencies, redundancy, bottlenecks, and other types of waste in their processes. Unlike most company cost-cutting efforts, mapping, analyzing, and improving the value stream leads to increased customer satisfaction, loyalty, reduced costs, and increased profitability, without sacrificing value creation.