Value stream mapping and an application in a manufacturing company

Shortened product lifecycles, demanding customers, globalization, and e-commerce have placed intense pressure on companies for quicker response and shorter cycle times. One way to ensure a quick response to changıng demand is by holding inventory. However, inventory costs can easily become prohibitive, especially when product obsolescence is considered. A wiser approach is to make the operating system lean and agile, able to adapt to changing customer demands. Born from necessity, the Lean production methodology offers companies not only a set of tools, rather a new philosophy and a fighting chance to remain competitive in a harsh and competitive market. The goal of this study is to examine one of the pivotal tools in the Lean production methodology, a concept known as Value Stream Mapping. It is a practical tool, which through the identification of waste shows the path towards process, cycle time reduction as well as improvement possibilities and as such is a basic principle of the Lean system. The study firstly offers an overview of all the key concepts of a Lean system but more importantly practically applies the Value Stream Mapping method within a production environment. The implementation of the method was done within a medium sized organization that produces parts and delivers them directly to one of Europe's biggest automotive OEM`s. The initial examination and the process of Current state mapping within the chosen organization recorded and analyzed key manufacturing statistics. Amongst others, some of the most notable problems detected were high inventory levels as well as a low Uptime KPI on the level of the entire value stream. The second part of the thesis offers solutions aimed at eliminating the sources of waste within the chosen value stream through the application of Lean production techniques. The result of the undertaken research proves that through the application of Value Stream Mapping not only can sources of waste be identified, but through the application of methods such as 5S and SMED, considerable process improvements can be achieved.