The Bank That Found 41 Value Streams
Northbridge Bank has 1,100 IT staff organized into nine delivery departments. Its new value stream management lead is asked for a value stream inventory in six weeks. In a first workshop, each department names its own value streams; the list reaches 41. 'Mortgage application' appears three times with different start and end points, and no single owner can describe the full path from customer application to funds released. A 200-person Integration and Data Platform group is also listed as a value stream because 'everyone uses it.' Two teams count the same 12,000 annual mortgage applications, so demand totals differ by 30%. Regulatory change freezes production releases except two windows per quarter, and audit requires evidence of approvals. The COO wants every one of the 41 mapped before any funding decision. The VSM lead has four experienced mappers and no dedicated data analyst.
1. Which candidates should be treated as value streams for the six-week inventory, and which should be classified differently? Explain the boundary test you would apply.
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Start from the customer trigger and outcome, not the department list. A value stream is the end-to-end sequence that turns a demand into value for an external customer, with a clear trigger, exit, owner and countable demand. 'Mortgage application' qualifies: the trigger is a complete application, the exit is a credit decision or funds released, demand is about 12,000 cases a year, and one person can be accountable for the flow. Card dispute and business onboarding also pass. The Integration and Data Platform group does not pass: its customers are internal, its output is a reusable capability, and counting its work as end-to-end would double count the streams it serves. It is a platform. The nine departments are not value streams either; they are organizational units that cut across stages. Apply the boundary test: would a customer notice the start and end, can demand be counted once, and can an owner be named? The 41-item list contains three mortgage variants and several department silos. Collapse duplicates and inventory three to four high-volume or high-risk streams first, with the rest on a candidate register. Regulatory release windows constrain stages but do not change the boundary.
2. How should the VSM lead respond to the COO's demand to map all 41 before any funding decision?
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The COO's demand is a trap. With four mappers and six weeks, the team can produce a defensible inventory of three or four validated value streams, not 41 maps. A value stream inventory is a register, not a wall of drawings: for each stream, record trigger, exit, owner, annual demand, major stages, platforms and enabling teams, known data gaps, and a first improvement hypothesis. For the platform group, record it separately as a supporting platform with its internal customers, request types, service-level expectations and its own flow metrics. Show the COO a one-page portfolio view: value streams, platforms and enabling teams, with a note that mapping all 41 would consume the six weeks and produce unvalidated drawings. Ask the COO to sponsor a prioritization rule: external customer impact, volume, risk, and feasibility of getting data. Offer to add the next two streams in the following quarter. This preserves the funding decision without pretending the inventory is complete.
3. What should the six-week inventory actually contain, and what should be deliberately left out?
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The inventory should contain three or four validated value stream definitions with trigger, exit, owner, annual demand, stage list, major handoffs, platform dependencies, and known data gaps. It should include a separate platform and enabling-team register, a candidate backlog for the remaining 37, and one improvement hypothesis per selected stream. Collect demand volume from CRM or case systems, timestamps at four to six major handoffs, and dependency data for the platform group. Leave out full step-level maps for all 41, future-state redesign, tool consolidation, and precise cycle-time claims where no timestamp exists. Those are later phases. The test of the inventory is whether a funding committee can decide which stream to invest in and who is accountable for end-to-end flow, not whether every department sees its own map.