The PDCA cycle is an improvement tool that can help with organizations’ processes. Read here how you can use a data-driven PDCA and improvement cycles in your organization to work step by step on a healthy, performance-driven improvement culture. But first, we explain the PDCA acronym:
- Plan: make a plan, because a goal without a plan is vain hope
- Do: execute the plan and collect reliable (process) data
- Check: check whether the results meet the goals & KPIs
- Actualize: adjust to achieve the intended results or scale down
Working with PDCAs is never an end in itself. To create sufficient support, you will have to be able to motivate and communicate the choice for this improvement methodology.
Order the Data Science book
Plan Do Check Act explanation in clear language
What is PDCA?
To really grasp the PDCA meaning, it is important not only to memorize the PDCA abbreviation, but also to understand the essence and live the concept. The order of the four capital letters is often mixed up. So, PDCA stands for: Plan Do Check Act and that is also the only correct order to implement improvement processes. Act does not refer to action, but to actualize.
Figure 1: What is PDCA: the steps Plan Do Check Act help you implement continuous improvement. With Plan you need passion, with Do you need data, with Check you need conscious control and with Actualize you need autonomy of action.
Why use a PDCA cycle?
With a PDCA cycle, you initiate a continuous learning and improvement process in an organization. You do this by giving KPIs, data analysis and human reflection a leading role. In this way, you give people who are passionate about their work the daily opportunity to improve their work process incrementally, step by step.
What is a PDCA cycle?
A PDCA cycle is a system that ensures that a given value moves around the standard, where you keep raising the bar. The term “cycle” indicates a (self) repeating process. It is also referred to in this context as a loop or control loop, a feedback loop where you measure the output of a process and then compare it to the desired value. Then you start acting on it.
The basic principles of a PDCA cycle
Figure 2: Overview of PDCA cycle and the four steps needed to get it working
How do you build a robust PDCA model? And is there actually a difference between the Deming circle and the PDCA circle? Below we discuss the basic principles of PDCA, continuous improvement and learning processes in organizations. We give the PDCA cycle meaning and more clout by connecting two domains – data analysis and continuous improvement. By adding four new dimensions to Deming’s quality cycle, we give the traditional PDCA cycle a new, modern look. Let your organization also benefit from the latest insights and our unique PDCA tips.
Phase 1 in the PDCA cycle: Plan
In the Plan phase, managers and professionals draw up a plan that includes what results they want to achieve and how they want to do it. In doing so, they take into account any frameworks imposed on the work process as preconditions. Plans and objectives are made SMART with KPIs and standards. This serious planning explicitly includes inspiring your people. The “why” must be crystal clear to everyone.
Phase 2 in the PDCA cycle: Do
In the Do phase, execution takes place, including the recording of events (input, processing, and output). Through interactive dashboards and data analysis, professionals monitor execution. People are allowed to make mistakes, but these are addressed directly at the source. There is room to experiment. In implementation, however, you have to mobilize your people. You will only succeed if you ensure sufficient capacity (so do not accept staff shortages) and deliver quality (well-trained people).
Phase 3 in the PDCA cycle: Check
In the Check phase, executives and professionals compare their actual results achieved with the planned results. They compare the reality with the KPI standard and the plan. To what extent is the execution still in line with the plans and objectives? In practice, there appears to be a large gaping hole between these two worlds: the world of management and that of the shop floor. Intelligent, data-driven organizations see discrepancies as an opportunity to learn. They evaluate the differences (the gap) and figure out their causes (root cause analysis). At this stage, you should also appreciate your people for what they have accomplished.
Stage 4 in the PDCA cycle: Act
Figure 3: The PDCA cycle cannot exist without an IMAR cycle.
In the Act phase, adaptation and adjustment take place. Think of interventions and measures to still achieve the originally planned result.
Managers adjust standards and KPIs but keep raising the bar. Employees develop a mindset of getting a little better every day. In this phase, you start reflecting with each other not only on the content, but also on the progress of the overall PDCA.
NOTE: Inspiring, Mobilizing, Appreciating and Reflecting, abbreviated to IMAR, is inextricably linked to these four steps in the traditional PDCA cycle.
Securing without worrying about tomorrow
Figure 4: Continuous improvement thanks to interim assurance of the results achieved
The PDCA cycle is emphatically not meant to be a one-time exercise. The effort is too intensive and the time commitment too costly. Continuous improvement should always be the goal (see figure 4). Ultimately you want to use continuous improvement cycles to achieve structural quality improvements that will still be acceptable, tenable, and sustainable tomorrow.
This means that you will have to secure the often laborious results achieved in order not to have to keep reinventing the wheel. Standardize what works and reject what doesn’t.
PDCA cycle example: make it a sport
As a concrete PDCA example, let’s use a current one for Europeans: reducing your own energy consumption. You want to reduce this because you hate waste, for example. Moreover, it’s also good for your wallet. With energy prices skyrocketing, saving energy is a must.
- Plan: consume a maximum of 150 kWh of electricity and 80 cubic meters of gas monthly. Current consumption is 180 kWh and 125 cubic meters of gas, respectively. Time to act. In your plan, you devise a number of measures to reduce energy consumption, such as turning off the heating one hour earlier in the evening and installing LED lights.
- Do: you implement the measures and every month you receive the consumption data from your energy supplier via the app. You analyze that data and plot it over time. You make a graph of it. You also make the costs transparent.
- Check: the first month after your plan, you discuss your energy consumption with your partner. You are at 179 kWh and 126 cubic meters of gas, severely insufficient to achieve what you planned.
- Act: you add a number of additional measures to your original plan. For example: take a 1-minute shorter shower (applies to all family members) and turn off appliances that use a lot of power, such as a clothes dryer and a television.
Figure 5: PDCA cycle worked out example – energy consumption across months, constantly look for room for improvement.
You go through the PDCA cycle until you reach your goal (the standard). You make it a sport. Or you adjust your goals and standards because your roommates are running cranky through the house due to the shortened shower times. But note that people are creatures of habit. Therefore, even in the above simplified example, it is essential to secure the results achieved, so as not to fall back into old habits (sneak a minute longer shower). At the same time, it is important to look for new savings opportunities. For example, you can also start improvement cycles with the goal of limiting the use of the dishwasher or clothes dryer, for example, or deactivating the standby mode on all kinds of appliances.
Also in work situations and in almost any business sector, such as healthcare, for example, there are plenty of ambitious improvement projects to define on which you can unleash the PDCA principles and achieve continuous improvement. Contact one of our management consultants to discuss and define your project.
11 PDCA tips and prerequisites for success
Below we provide some tips for implementing the PDCA cycle. Use these tips as prerequisites for the proper application of the PDCA model in your own organization.
- Going through the PDCA cycle pro forma is pointless and a contempt for the Deming circle. Take the example of a healthcare organization where everyone is critically reviewing and monitoring all processes and KPIs ahead of an HKZ certification that will take place in two months. If after the inspection everyone goes back to business as usual, nothing has been achieved. That is precisely not the purpose of the PDCA cycle. PDCA is about continuous improvement and intervenes deeply in the organization and should not take place superficially, once a year or so.
- A PDCA without KPIs is like a car without wheels. Don’t forget to name in your plans the desired improvement of one or more KPIs. During the Do phase you will analyze the data behind the KPIs, in the Check you will compare the execution based on your KPIs with your objectives as formulated in the plans or policy intentions. The PDCA circle can never start turning without reliable data, insights and SMART KPIs. Improve KPIs sustainably based on the rhythm of the PDCA cycle.
- Always apply the PDCA cycle integrally: that is, go through all the steps. People tend to pick only those steps from the PDCA method that are useful to them at that moment. There is cherry picking. Or they get no further than the P and the D, and give up at the C. So, you never reap all the benefits of the Deming cycle. The integral application of the Deming circle, if properly secured with KPIs in the line, will eventually always translate into better (financial) performance.
- Realize that the PDCA cycle can be applied at strategic, tactical, and operational levels. Moreover, the different levels are closely intertwined. The implementation of the strategic plans determines the frameworks for drawing up the tactical and operational plans. And the progress reports from the tactical and operational reports from the Check phase serve as input for the higher strategic plans. You will thus begin to see the connection between improvement initiatives, the strategic frameworks, and operational processes.
- Regularly test your plans against implementation. Do not wait too long but start with this as soon as possible. There are now enough examples of projects that were started with the best of intentions, but because of a lack of interim adjustment, have gone completely off the rails.
- Make data analysis a permanent part of the Do phase. The PDCA cycle stands or falls with reliable data that you need to analyze in more detail. Without solid data analysis, you’ll never get the PDCA cycle completed and you won’t be able to do your job properly.
- Take the Check phase seriously. For example, set aside half an hour of time every two weeks for each team and individual employee to complete the Check phase. Is the process running as expected? Does the output meet the standards? Are deviations staying within the rule boundaries? And how is the trend developing? The same motto applies to the Act phase, but then those responsible at the strategic and team levels must get to work.
- Always link the major PDCAs to the minor PDCAs. The decision to only set up a PDCA cycle at the policy level and over a large one-year time frame does not ensure continuous improvement or innovation. Only a large PDCA cycle is too unwieldy for that. And if employees focus solely on their daily improvement in a small PDCA cycle, they lose sight of the larger development. So, both cycles are needed. The large PDCA gives direction and frameworks to the smaller PDCA, allows for in-depth investments, and ensures stability and continuity. The smaller PDCA cycles are improvement loops that are small enough that a person recognizes themselves in them and large enough that a person can measure their own performance against them.
- No longer base organizational decisions on opinions or feelings, but on facts. Inspiring managers regularly adjust standards and KPIs while raising the bar ever so slightly. Employees, in turn, develop an improvement mentality. They are “in control” and experience more job satisfaction because their autonomy puts them back in control.
- Make a link between the PDCA and lean processes. Look for symptoms of poor processes such as long lead times, lots of extra checks, lots of data retyping, high work stocks, buffers, and lots of exceptions in the process. Look for the eight wastes that occur almost in every process or organization: overproduction, overprocessing, waiting, transportation, inventories, moves, defects, Deming wheel and poor use of talent. For each waste, start a new PDCA cycle and create a plan to stop the waste.
- The D of Data and the D of Do: Achieve better financial results using the PDCA. Our large-scale PDCA research shows that applying Plan Do Check Act company-wide not only improves profit margins. Work stocks drop dramatically and customers are more satisfied. These results are mainly due to a few simple rules of thumb: set standards and targets for each KPI (Plan), regularly evaluate the standards and targets and adjust them (Act), use steering information and KPIs consistently for analysis and action (Do), use steering information and KPIs to improve and innovate (Do), talk about the numbers and hold each other accountable for negative and positive performance (Check).
The data-driven PDCA
Adding four new dimensions to the traditional PDCA circle creates what we call a data-driven PDCA cycle. The P of Plan is extended with the P of Passion. The D of Do is connected to the D of Data. The C of Check is associated with the C of Conscious control and the A of Actualize is correlated with the A of Autonomy.
- Passion: Every plan ultimately begins with a personal mission, or passion. With someone who really wants something different, who has a dream, or personally feels the urgency or drive to actually improve something.
- Data: just the Do phase is not enough. Doing, based on data analysis, and on irrefutable facts that reliably monitor, over a long period of time, the impact of your attitudes and behaviors, forms the extension of this phase.
- Conscious control: monitoring alone is not all that happens in the Check phase. The constant feedback of data, and its effects activates a learning loop. People become increasingly aware of their own role, the role of others and the effect of all these influencing factors on the total. They learn how the business actually works. And they learn how the (total) system responds. Conscious control allows people to consciously adjust plans. Thus, they become more and more “in control.”
- Autonomy: the outcome of going through PDCA circles is that the professional develops more and more autonomy. They no longer have to directly follow managers but can determine on the basis of data what works and what needs adjustment.
Following this now amply proven PDCA method, we allow organizations to take maximum advantage of the improvement potential present in every organization. Through this enrichment of the PDCA cycle, we also implicitly respect the ideas of William Edwards Deming. He was a great proponent of the use of statistics and data in the PDCA cycle.
PDCA circle = Deming circle
In practice, the PDCA circle, Deming’s circle, the Deming wheel, and Deming’s quality circle are used interchangeably. The same goes for the PDCA cycle and the Deming cycle. Just to clarify right away: there is no essential difference and all concepts are visualized almost in the same way: as a circle or a wheel. In other words, they are all synonyms for the same concept, the concept that is all about continuous improvement, controlled process optimization and data-driven work.
Discover the two basic forms of PDCA
Looking at the positioning of PDCA within a business or work process to achieve improvements, there are two basic forms of PDCA, or two routes to success:
Figure 6: The two basic forms of PDCA visualized
- The PDCA as a regular improvement cycle. This PDCA keeps pace with regular work processes and the classic planning & control cycle. This PDCA cycle is characterized by standards and targets, monitoring, the use of data and steering, changing and improving through key performance indicators (KPI examples) and other indicators. Corrections take place directly in the existing line organization. With the existing means or ways of working, you already lift the organization to a higher level and reach the planned performance more easily.
- The PDCA as a space for experimentation. In addition to the regular PDCA, this PDCA cycle is intended as a safe experimentation space. This helps to practice improvements “on dry land” first. Here, employees can try out new things in a kind of “sandbox” environment. This then has no immediate impact on day-to-day operations. This PDCA cycle starts with questions like, “what problem do we need to solve?” but also, “how might we develop a completely different approach?” Often new resources, competencies or completely different ways of working are needed to get this done. Continuous improvement is now reaching the realm of innovation.
If you encounter problems or a challenge in the regular business processes that are too risky or disruptive to fix directly in the line, then start up a PDCA as an experimentation space through a sideline. From the Actualize phase of the regular PDCA cycle, you start trying to fix the problem with a loose PDCA. The idea is not to turn regular operations upside down and still get started with innovations.
KPIs can perfectly link the different steps in PDCA. Read our guide to find the right KPIs for your company. As a result, the PDCA cycle gains tremendous relevance, power and usability.
Want to know more or need practical advice?
Do you want to know how to improve your organization’s performance with the Plan Do Check Act cycle? Do you want a clear explanation of the PDCA cycle? Are you curious how you can make your company or teamwork smarter and also more data-driven with the PDCA method? Do you want to know how to draw up a practical PDCA form? Or do you need an improvement consultant or change specialist? Then contact us now for an exploratory meeting with one of our PDCA experts or improvement coaches.
About Passionned Group
Passionned Group is the specialist in implementing the PDCA cycle and data-driven PDCA circles. Our experienced and passionate consultants help larger and smaller organizations in making teams and the entire organization data-driven. Every other year we organize the independent election of the ‘Smartest organization in the Netherlands’.