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The value stream is depicted as an end-to-end collection of value-adding activities that create an overall result for a customer, stakeholder, or end-user. In modeling terms, those value-adding activities are represented by value stream stages, each of which creates and adds incremental stakeholder value items from one stage to the next. [1]
Developing a value proposition is based on a review and analysis of the benefits, costs, and value that an organization can deliver to its customers, prospective customers, and other constituent groups within and outside the organization. It is also a positioning of value, where Value = Benefits − Cost (cost includes economic risk).
Value-adding: The transformation taking place within the process must add value to the recipient, either upstream or downstream. Embeddedness: A process cannot exist in itself, it must be embedded in an organizational structure. Cross-functionality: A process regularly can, but not necessarily must, span several functions.
A product must offer value through price and/or quality in order to be successful. Competitive advantage can come in a range of ways, such as pricing, packaging, layout, looks, services provided and more. All these can add value proposition to a product, therefore making it worth more, and more desirable to a customer.
In a build-to-the-standard form, Shigeo Shingo [16] suggests that the value-adding steps be drawn across the centre of the map and the non–value-adding steps be represented in vertical lines at right angles to the value stream. Thus, the activities become easily separated into the value stream, which is the focus of one type of attention, and ...
Added Value can also be defined as the difference between a particular product's final selling price and the direct and indirect input used in making that particular product. Also it can be said to be the process of increasing the perceived value of the product in the eyes of the consumers (formally known as the value proposition).
The model is defined by the organization's vision, mission, and values, as well as sets of boundaries for the organization—what products or services it will deliver, what customers or markets it will target, and what supply and delivery channels it will use. Mission and vision together make part of the overall business purpose. While the ...
In modern terminologies, this can also be described as a value stream, where instead of traditional departments, the organization is structured into product lines or families and value streams. It can be visualized as changes or improvements made to one line being implemented to multiple other lines or processes.