Do you know the PDCA cycle? Get to know all its stages and how to apply them in your business.

PDCA or the Deming cycle is a management methodology that aims to continually improve processes. This cycle is based on four stages: plan, do, check, and act.

To adapt to market changes, improve efficiency, boost productivity, and meet the needs of your customers, having a method is required. Already known among managers for about a century, the PDCA cycle is still widely used, and can strongly contribute to optimizing your company's processes.

Want to learn more about the stages of this cycle and how it can be applied in your business? Read on to find out!

What is the PDCA cycle?

PDCA stands for Plan, Do, Check, and Act/Adjust.

Accordingly, the concept of PDCA is related to a process of continuous improvement that must be applied in these four stages, performed cyclically, with the aim of making products or processes better and faster.

Is PDCA a tool?

It is a great and simple methodology for those organizations that want to create a sustainable advantage, it helps to create a never-ending improvement cycle that can be applied for Customer Experience, Employee Experience, Leadership, Strategy, Innovation, and Agility; the building blocks we use to empower companies to fulfill what they need to thrive. It is key to create and achieve sustainable growth!

Also called the Deming Cycle or Shewhart Cycle, PDCA is a methodology that can be applied in any business process (or even in personal life) that needs ongoing improvement.

The PDCA method was developed in the ‘20s and gained visibility in the ‘50s, when William Edwards Deming, the father of quality management, implemented the logic of planning, executing, analyzing, and enhancing a large project: to rebuild Japanese industrial infrastructure after World War II.

Why is it considered a cycle?

A linear system recognizes the last stage as the final step, and this isn't the logic of PDCA. A cycle of continuous improvement, as the name suggests, is based on repeated attempts at process optimization.

PDCA is recurring, that is, it's necessary throughout the entire process to plan, execute, and measure results, analyze them, find improvements, put them into practice, and then start a new cycle.

What are the stages of the PDCA cycle?

But how do you create a PDCA step by step? The PDCA cycle includes this sequence of stages that must be followed without omitting any:

P: Plan

The first step when trying to optimize a process and improve a product or service is to plan. The company's strategic goals, as well as the customer's expectations, must be aligned in order to fulfill the next stages.

First, it's necessary to conduct a diagnosis to identify existing problems, define priorities of what needs to be improved, or even detect new opportunities.

After defining the goal, you must break it down into realistic and tangible objectives. At this point, it's important to survey data and information to define the scope of work.

Once the team gets together, it's time to put pen to paper and create an action plan with the tasks that must be performed in order to achieve objectives. Define deadlines, a schedule, and the people responsible.

You must also define key performance indicators (KPIs), which are metrics to be analyzed in the next stage.

D: Do

Now it's time to put your plan into action. It's important for the team to receive particular training to execute what's laid out in the plan.

During execution, you should also try to collect data so you can monitor processes and measure results. Record them whether they're positive or negative.

C: Check

Now, analyze the results. In this stage, having objective and quantitative parameters are needed in order to properly assess process improvement and quality standards and to compare them to previous cycles.

In this stage, you can identify problems or failures in the process, which can be adjusted later.

A: Act

Also, the “A” in PDCA also stands for “adjust”, and it represents the actions to be implemented to correct the failures detected in the previous stage. At this point, you can point out solutions to problems and then amend planning according to the new results.

In this stage, there are two different outcomes:

If the expected result was achieved, it can serve as a reference for other processes and departments, or other units of the company, for example.

If the result was below expectations, it should be analyzed in order to find new solutions.

It's important to mention that the market is very dynamic, technological innovations are created all the time, and it's difficult to consider a pattern that worked to be definitive. Even if a strategy worked, it's likely it can be improved going through the PDCA cycle again.

When should you use PDCA?

This method can be used in any process to put your company always in a cycle of continuous improvement in order to implement standards and increase efficiency.

The more you repeat the cycle, the more you increase gains in quality and improve customer service, increasing your advantage.

You can use PDCA for:

Managing routines: Standardize your company's day-to-day processes and define a quality level for activities.

Managing improvements ensures a certain quality level, and always seeks to adapt to external instabilities and find ways to stand out in the market.

PDCA: Examples

To better clarify the meaning of PDCA, we can show a simple example of a problem solved through PDCA. The development of a new shampoo bottle.

After learning that customers aren't satisfied with the packaging because part of the product is wasted, the cosmetic company could:

Bring together the product development team, R&D, and the information gathered by the customer service team. After that, plan a new package that meets customer expectations and reduces waste.

With a defined action plan having deadlines, goals, and people in charge, you can start the actual production of the packaging.

With data collected at the factory, such as raw material costs, production time, and more, the team oversees the process and assesses results. At this point, the new package is released and new customer feedback is collected.

With all the information gathered, performance is analyzed and new solutions are suggested for more improvements, starting the next cycle.

Already in use for many years, the PDCA cycle can be considered a simplification of several other methodologies that aim for continuous improvement. This is the case of the BPM continuous improvement cycle.

A company focused on Business Process Management is constantly and repeatedly planning, mapping, executing, documenting, monitoring, and refining its processes. We could say that it's like the PDCA method, but more complex and more detailed.

With a BPM system (BPMS), it's possible to automate these stages and apply the PDCA method throughout the entire chain of the company, optimizing end-to-end processes.

Examples of PDCA in conjunction with technology include an action plan to reduce a company's use of paper:

In this case, we analyze the problem and, as an action plan, we implement an ECM (Content Management) system, and a process is prioritized to be used as a start.

After defining the need for an ECM system, the implementation stage of this system begins.

Once implemented, the processes which previously used paper can be performed on the system, now generating data in the system, such as a sales funnel process that generates a signed contract. This contract would normally be stored in a physical folder, but in this system, it will be stored automatically.

At the end of the cycle, the results obtained by implementing the system are analyzed, new opportunities in other processes are observed, as well as improvements that could be applied to this process.

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