Value is realized when delivered and on customer’s hands.
Therefore, start finishing and… most important:
Make value flow without interruptions.
Interruptions (i.e. non-value-added steps, delays, bottlenecks, etc.) slow down the flow…causing long lead time.
Continuous delivery of value at the shortest sustainable lead time is ideal.
Efficiency of flow is key. We use Flow Efficiency Ratio to measure this.
Let us bring this to home. Observe this video:
The daytime scene is me travelling from my home to uptown. It took me 45 minutes. Flow is with interruptions — lots of stop and go situation… causing unnecessary delays.
Without interruptions, it should have taken me only 15 minutes. As proof of this 15 minutes, the night time scene is me travelling back from uptown to my home. It took me 15 minutes. Flow is without interruptions — no stop and go situation.
The formula for Flow Efficiency Ratio = Total Active Flow Time (no delays) divided by Total Flow Time (including delays) x 100%
In this scenario, Flow Efficiency Ratio = 15 minutes divided by 45 minutes. Flow Efficiency Ratio therefore in this case is 33%. This scenario has a low Flow Efficiency… lots of wastes (i.e. bottlenecks, delays, etc.).. this is not good.. and must be optimized. In contrast, the ideal Flow Efficiency Ratio for this scenario would have to be 100%… which is 15 minutes (total active flow time) divided by 15 minutes (total flow time) x 100%.
To optimize flow (for high Flow Efficiency) in your system, you must first learn to see wastes in your system. That is our topic in the next blogs.