Value Stream Management (VSM)

Value Stream Management (VSM) is a lean business practice that seeks to optimize the flow of value from a business request to delivering the product or service to the customer. The value stream refers to the sequence of activities an organization undertakes to deliver on a customer request.

Purpose and Role:

The purpose of VSM is to identify waste and areas of improvement in the process, from the start of a product or service to its delivery. It aims to eliminate these wastes and improve efficiency. The role of VSM is crucial in lean management and continuous improvement practices where the focus is on improving the overall process flow rather than isolated points.


The main components of a value stream are the value-adding processes, non-value adding but necessary processes, and wastes (unnecessary non-value adding processes). Value Stream Mapping is a technique used in VSM to visualize these components and their relationships.


VSM is important as it helps to identify inefficiencies and bottlenecks in the process that may not be noticeable when focusing only on separate activities. By providing a big picture view, it helps to align improvements towards the end goal of delivering more value to the customer.


Value stream management has its roots in lean manufacturing principles, which originated in Toyota's production system in the mid-twentieth century. The principles have since been applied to fields beyond manufacturing, such as software development and service industries.


  1. Improved Efficiency: Organizations can reduce costs and improve efficiency by identifying and eliminating waste.
  2. Better Quality: VSM helps improve quality by reducing errors and rework.
  3. Faster Delivery: Organizations can reduce lead times by identifying and removing bottlenecks.

Pros and Cons:


VSM allows for a broad view of the process, identification of waste and inefficiencies, increased collaboration, and customer-centric focus.


It may be time-consuming, require cultural change, and may not be suitable for all processes.

Examples: In software development, VSM could involve mapping out the stages from initial feature request, to development, to testing, and finally to deployment. The goal would be to identify any bottlenecks or wastes in the process that could be slowing down delivery or reducing quality.

See Also