PDCA cycle lifts up your business results

Exposing the foundation of BI and performance management

Research among almost four hundred organizations has shown that the famous PDCA cycle (Plan-Do-Check-Act) is crucial to achieving better business results. Not only can it improve your profit margins and drastically reduce workloads, it can also lead to increased customer satisfaction. Dr. Deming’s quality cycle has proven to be the foundation of using management information and KPIs to achieve great success.

Quality expert Deming

“Improving quality will lead to a reduction in spending and improved productivity and market share”, Deming said back in the fifties when he addressed a room of Chief Executives. This statement has proven its value over time.

The PDCA cycle

Research has shown that it isn’t the management information itself, no matter how high the quality, that ensures success and better performance. The determining factors of success are how you use the PDCA cycle to work with information related to the company goals and organizational strategy. Whether the information is actually used, with which goals, and whether or not the scores on the performance indicators are discussed.

“Everyone has heard of the PDCA cycle, but there are few people who can really implement one in an organization. Maybe the term PDCA reminds people of a clinical quality system with too many unappealing restrictions”, says Daan van Beek, Passionned Group’s managing director and author of various management books, including The Intelligent Organization.

Implementing the PDCA cycle

The research shows that better business results shouldn’t be a huge challenge, and from a practical perspective, implementing the PDCA cycle is definitely achievable:

1. Set norms and targets, regularly evaluate them, and adjust them (plan, act).
2. Use a management information system for analysis and action.
3. Use information to improve and innovate (do).
4. Discuss the numbers and talk to each other about positive and negative results (check).

“In the end, the decisive factors are discipline, an analytical company culture, and social skills, especially from people in leadership roles”, says Daan van Beek.

Four factors for better organizational results

The four factors mentioned above can be seen as the turbo engine powering a fast and agile car. Of all the factors that were researched, these four can be seen as being responsible for a third of the success of better business results in performance management models and business intelligence. Correctly implementing a PDCA cycle and quality management in every layer and discipline of the organization can make a real difference!

Is your company intelligent?

Passionned Group started its PDCA research to gain insight into the degree to which smart organizations can demonstrate substantially better performance, among other reasons. Do you want to improve your company’s performance? Contact us for information about PDCA, or take a look at our training courses.