Time-Based Value Stream

Introduction

Understanding the flow of value within complex systems is a crucial challenge in various fields, from software development to business operations. Exploratory Domain Discovery offers a powerful approach by emphasizing the identification of Domain Circular Patterns within these systems. These patterns, often overlooked, provide valuable clues about how processes function and offer a structured approach to exploration.

This article introduces the concept of a Time-Based Value Stream expanding on the idea of circular patterns by explicitly focusing on the temporal aspect of these cycles.

By integrating the dimension of time, we gain a more nuanced understanding of how value is created and delivered within a system. EDD’s approach is particularly useful in collaborative modelling approaches where some methods may fall short, offering a structured way to uncover hidden patterns and gain valuable insights.

Streams

In a complex domain, a Stream represents a sequence of activities or events that flow through the system. This flow can involve the movement of information, materials, resources, or even people. Streams can be linear, branched, or cyclical. They describe the general movement and transformation of entities within the domain. For example, in a manufacturing domain, the production stream might involve raw material acquisition, manufacturing processes, quality control, and distribution.

Value Streams

A Value Stream is a specific type of stream that focuses on the activities that directly contribute to delivering value to the customer or end-user. It encompasses all the steps, both value-added and non-value-added, involved in creating and delivering a product or service. A key aspect of a value stream is its focus on the customer perspective – what the customer perceives as valuable. In the manufacturing example, the value stream might be a subset of the production stream, focusing only on the steps that directly transform raw materials into a finished product that meets customer specifications. In complex domains, multiple streams can exist, some of which may intersect or overlap. Identifying the specific value streams within these domains is crucial for optimizing processes, reducing waste, and maximizing value delivery.

Accounting Examples

The Financial Reporting Stream encompasses all activities related to generating financial reports. This includes recording transactions, preparing trial balances, adjusting entries, creating financial statements (income statement, balance sheet, cash flow statement), and distributing reports to stakeholders. This stream is cyclical, repeating monthly, quarterly, and annually.

The Monthly Close Value Stream focuses specifically on the activities required to produce the monthly financial statements. This subset of the Financial Reporting Stream includes specific tasks like reconciling bank accounts, accruing expenses, and calculating depreciation.

Flight Reservation Examples

The Customer Booking Stream encompasses all activities from a customer’s initial search for flights to their post-flight experience. This includes flight searches, seat selection, booking confirmation, payment processing, check-in, boarding, in-flight service, baggage handling, and post-flight surveys. This stream is primarily linear from the customer’s perspective.

The Online Booking Value Stream focuses on the customer’s online experience of searching, selecting, and booking a flight. This subset of the Customer Booking Stream includes activities like displaying available flights, providing fare information, allowing seat selection, processing payments, and sending booking confirmations.

The Importance of Circularity and Time

Things that happen in a repeating pattern (like a circle) always involve time. This time aspect is really important for understanding how value flows in any system. Just like a watch uses circles to show time, many systems use repeating processes that we can think of as circles.

These circles aren’t just ideas; they are real actions that take time and create value. When we find these repeating patterns, we can understand the main ways things work and how often they happen. We can also see how different parts of the system affect each other over time, and how changes in one area spread to other areas.

When we specifically focus on the time part of these repeating patterns, we create what we call a Time-Based Value Stream. This idea shows the steps that happen again and again, and it emphasizes how long each step takes, how often it happens, and how the steps depend on each other.

Examples of Time-Based Value Streams

The domain circularity patterns article provides several examples of cyclical patterns. Let’s reframe them as Time-Based Value Streams:

• Accounting System: The Financial Year can be seen as a Time-Based Value Stream. It encompasses monthly and quarterly reporting cycles, periodic inventory counts, and the revenue and expenditure cycles, all operating within the defined timeframe of a year. Each sub-cycle has its own temporal characteristics (daily, monthly, quarterly) contributing to the overall annual cycle.
• Payroll System: The Pay Cycle is a Time-Based Value Stream. It involves the recurring sequence of time recording, pay calculation, paycheck generation, payment distribution, and reporting, all within a specific timeframe (weekly, bi-weekly, or monthly). The Tax Cycle also operates within this framework, with its own schedule for tax withholding and remittance.
• Hotel: The Guest Cycle represents a Time-Based Value Stream, encompassing reservation, check-in, stay, check-out, and post-stay activities. The Room Maintenance Cycle and Inventory Cycle (Amenities) also operate on specific timeframes, contributing to the overall hotel operation.

The concept of a Time-Based Value Stream provides a valuable lens for exploring complex domains. By explicitly considering the temporal aspect of cyclical patterns, we gain a deeper understanding of how systems function and how value flows within them. By focusing on duration, frequency, schedules, and visualizing processes, we can effectively map Time-Based Value Streams and unlock a more comprehensive understanding of complex domains.