So I’ve been formulating this theory. I’ve been trying to think about how lean principles apply to a value stream of information. Intuitively, it would seem the faster the information gets from its source to a “customer”, the better the information and the more value is created for the customer. The president of one of the companies I work with made a great, yet simple observation about feedback…we expect instant feedback…you press a button on a cell phone and it beeps giving you feedback that you pressed the button. Imagine if it didn’t beep for 10 seconds? Did I press it? Should I press it again? Is there a problem?

So, we have information systems…ERP’s, spreadsheets, databases, email. Don’t we expect feedback from them? We expect things like, where are we making the most money? Where are we losing money? Are we making money? Where are our biggest opportunities? Am I ahead of the game, RIGHT NOW?

We want our information systems to tell us this. We need the feedback to know where it hurts, or where we are succeeding. So the faster we bring information to the customer with the least amount of waste, the more responsive we can be and the more accurately we can respond to the information.

I’ve diagrammed three rough “information value streams” below. The information comes from the supplier, in this case the shop floor. It arrives at the customer, which could be a variety of people: shop floor operators, department managers, operations managers, and others. The first information stream roughly represents what a lot of improvement driven organizations do to capture shop floor information to identify waste and manage customer demand. The middle stream represents a lot of companies that use an ERP or job shop system to capture shop floor data (labor, burden, material). The final represents a system that captures production data and abnormalities directly on the shop floor and can report them and summarize them immediately. I have labeled this one MES for Manufacturing Execution System even though I do not like the term, but since people seem to be familiar with it and I haven’t coined my own term, I have used it here.
Three information value streams

The faster the information gets from the source to the customer, the faster we can respond. The types of information may vary in the diagram…some may be financial, some production output based, some quality related, etc. However, should we think of information like we do physical product? Aren’t the hand-offs and work-in-process within information flow just as costly and non-value added as similar manufacturing activity? Information that is handled multiple times, like in the first row certainly has the potential for additional mistakes (quality problems) as it is passed from operation to operation. The work-in-process in both of the first two streams means that information can become “obsolete” as the information sits around, waiting to be used. In fact, in today’s rapidly changing lean environments, isn’t waiting for the end of the month financial statements too long to respond to the waste that is occurring on the shop floor every day. And does an ERP even point you in the direction of where to start?

The last stream of information hopefully provides the closest thing to timely feedback. There aren’t any hand-offs, and the data can provide relevant information very quickly to the customers…visual information to the shop floor operators and production supervisors about production progress and summary information about where the biggest opportunities are arising to remove waste from the process.

This is just the beginning of my theorizing. I think there are other lean principles that apply to the world of information management (5S for example) and I will be discussing in future posts.