W. Edwards Deming in the 1950’s proposed that business processes should be analyzed and measured to identify sources of variations that cause products to deviate from customer requirements. He recommended that business processes be placed in a continuous feedback loop so that managers can identify and change the parts of the process that need improvements. As a teacher, Deming created a (rather oversimplified) diagram to illustrate this continuous process, commonly known as the PDCA cycle for Plan, Do, Check, Act*:
- PLAN: Design or revise business process components to improve results
- DO: Implement the plan and measure its performance
- CHECK: Assess the measurements and report the results to decision makers
- ACT: Decide on changes needed to improve the process
Deming’s PDCA cycle can be illustrated as follows:
This ‘wheel within a wheel’ describes the relationship between strategic management and business unit management in a large company. There are actually several separate business units, of course, each with its own set of metrics, goals, targets and initiatives. But this figure illustrates the idea that the business activities constitute the DO part of the overall strategic effort.
* Note: The PDCA cycle was in fact originally developed by Walter A, Shewhart, a Bell Laboratories scientist who was Deming’s friend and mentor, and the developer of Statistical Process Control (SPC) in the late 1920s. So sometimes this is referred to as the “Shewhart Cycle”. There are also several recent variations on this concept. See The Man Who Discovered Quality by A. Gabor, Penguin Books, 1990.
©1998 Paul Arveson
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Deming Cycle - PDCA
This cycle of "Plan - Do - Check - Act" is also known as the Control Circle, or PDCA.
Kaoru Ishikawa has expanded Deming's four steps into six:
- Determine goals and targets.
- Determine methods of reaching goals.
- Engage in education and training.
- Implement work.
- Check the effects of implementation.
- Take appropriate action.
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