Value Stream Mapping Math: Rolled throughput Yield

Value stream analysis is an effective way to identify improvement opportunities within a product or service family’s value stream, envision a leaner future state and develop an actionable value stream improvement plan to achieve the future state. It's bread and butter stuff for the lean practitioner. Most folks are well acquainted with the value stream map’s lead time ladder. And many people are familiar with the concept of rolled throughput yield. However, based upon my humble observation of hundreds of value stream maps, there are precious few who incorporate a rolled throughput yield (RTY) line within their maps. It’s a shame. The process yield data is typically already captured in each process’ data box. From there, it doesn’t take too much effort to build out the RTY line. Know that yield represents the percentage of the process output(s) – fabricated part, assembly, analysis, transaction, reports, etc. that do not require any sort of rework or replacement, at any time. In the service and healthcare industry, this includes completeness and accuracy, the first time. VSM.RTY1Granted that the yield data contained within a current state map is often in the SWAG (scientific wild a** guess) or plain old WAG accuracy category, it still can generate a very insightful RTY line. It is painful, but not surprising to see current state RTY’s in the single digit range (i.e., <=9%) …or worse. Think of that as opportunity. The RTY line captures the discrete process yield directly below the related process box and lower lead time ladder rung. As you can see in the figures, it is “boxed in.” The discrete process yield boxes are connected via a horizontal line. In between each box is recorded the cumulative or rolled throughput yield. By the very end of the RTY line, we have the full RTY for the value stream. VSM.RTY2Things can get a little bit funky when there are branches within the map. See the second figure for an example. It essentially applies a weighted average yield. In summary, make your value stream maps more useful. Add a RTY line! Related post: Value Stream Mapping Math: Lead Time Ladder Process “Branch”

There are 5 Comments

Dave's picture

I learned the value of the RTY when you taught it to us during our initial VSM days at [Large printing company!] and have used it ever since. People's jaws drop when they see that often times by the time work is half way through the value stream, the yield has dropped to almost zero. Big eye opener, and great source of improvement ideas!

MarkRHamel's picture

Hi Dave,

Thanks for the comment and the testimonial to the value of value stream RTY!

Best regards,
Mark

MarkRHamel's picture

Hi Eric,

That's a great question (and point)!

Typically, I would simply drop the unadjusted processing time down to the lead time ladder. The RTY line gives insight into the likelihood that a unit, generically speaking, will make it through the line complete and defect free/accurate. Additionally, the data box will capture relevant data for each process. However, if the yield within a process is abysmal, it may make a lot of sense to apply a factor to the processing time, knowing for example we may on average have to process something 1.5 times to yield 1.0 units. (similar thinking may need to be applied to queue time...) That obviously can address the quality side of OEE, but speed and performance is usually a little more tricky - especially given the difficulty of capturing accurate and relevant OEE data.

Bottom line, we must go back the purpose of the VSM which is to help a team identify how value flows or doesn't flow in the current state and then, by applying lean principles, systems, and tools design a future state and related pragmatic value stream improvement plan that will yield certain measurable performance levels by a given date. VSM's are a high level tool - often described as operating at 20,000 foot altitude with 80% accuracy. That's usually good enough for people to "see" (as in the book, "Learning to See"). When it gets to be closer to a science project, the risk is the participants will becomes frustrated and/or miss the forest for the trees. Sometimes just circling the "ugly" numbers in the data boxes (yield, set-up, etc) is good enough.

One last sniff test when it comes to the math is to add up the full length, top and bottom, current state lead time ladder and see how it compares to the known/measured/or at least estimated lead times. Often the first attempt is off, sometimes a little, sometimes a lot. The reasons include basic math errors or some of the dynamics that you wisely point out. I like to ensure that we reconcile that before we move on to the future state design. Folks need to have comfort that they captured the current state reasonably enough (back to the 20,000 ft, 80% accurate).

Another approach is to keep the "unadjusted" lead time ladder and RTY line and add a second ladder which captures the OEE impacted math.

Hope my thoughts make sense.

Best regards,
Mark

Eric's picture

Thanks Mark. Makes sense to focus on the true intent of the VSM which is the high level stuff. Too often we get caught up in what you accurately describe as a "science project"!

Eric's picture

Hi Mark, I've found your blog very insightful and useful so thank you. Question on yield on your VSM. I typically divide process time by the OEE (includes yield) at a given process box to be more realistic So if my OEE is 60% and my observed process time is 100 minutes, I use 166 minutes as my lead time contribution. Would you do the same? I've seen a lot of lean practitioners just drop the Process time down without factoring in the OEE or yield. Thanks in advance.