What is PDCA?
The Plan-Do-Check-Act (PDCA) method is a framework used to achieve continuous improvement in a particular organization or process. It’s also known by several other names, including the Deming wheel, Shewhart cycle and the control circle. Even though the method was originally rooted in quality control, it has since been adapted and adopted across all aspects of business management.
The best way to understand the PDCA method is to break down each part. “Plan” is a sensible first step in strategic development. It’s where objectives, restrictions and methods are finalized. “Do” is just about doing those objectives usually on a small or temporary scale. “Check” is where all the data and results from “Do” are examined and appraised.
The final step is either “Act” or “Adjust” depending on your preference, but the meaning is the same. This is where permanent change is enacted as the baseline for the next PDCA cycle. This is a recurring or iterative process that slowly sculpts an organization or process into a new shape.
The Benefits of PDCA
PDCA is a cautious and deliberate approach to management. It will be just as ambitious or prudent as you want it to be. It’s a flexible, adaptable method that is suited for almost any business environment. The general structure of this method is also similar to the core framework of six sigma, which is Define, Measure, Analyze, Improve and Control (DMAIC).
How to Create PDCA
The first step is to establish the responsibility and scope of the initiative. There needs to be a clear chain of command for conducting any kind of management program in a workplace with multiple employees. There should also be a clear scope for the project to keep things moving towards a definite conclusion.
For example, a company could focus their PDCA on eliminating non-value-added (NVA) time delays across the entire production process. It may seem counterintuitive to focus on narrow or specific issues, but you need to remember it’s a cycle. It’s all about shaving off one strip of inefficiency at a time through continual solutions.
What is OODA?
The Observe-Orient-Decide-Act (OODA) cycle is another kind of method for pursuing ongoing improvements within a particular process or organization. It’s a foundational concept in several modern fields, including law enforcement, litigation and military strategy. The features that make it a great fit for these fields also lend it serious potential for business applications.
The OODA loop is a recurring process and a decision-making framework. It’s essentially a consistent and effective approach to problem solving. This method also shines in competitive environments where anticipating and reacting to other people is important for success.
The Benefits of OODA
The real beauty of the OODA cycle is responding to unpredictable or hazardous situations. It’s one of the best ways for businesses to position themselves to face threatening circumstances. Focusing on observing and orienting around emerging external factors is like pointing a ship into a wave instead of letting it smash into the side. It might still be scary and challenging, but at least there’s a good chance you’ll survive.
How to Create OODA
Adopting OODA is easy enough if leaders are willing to embrace the shift in perspective and management style. This method is all about staying calm while you collect information, evaluate the nature of a problem and decide what solution is the best for the situation. It’s all about analyzing and reacting. Leaders need to emphasize objective observation and get as much feedback from others as possible.
PDCA vs. OODA: What’s the Difference?
Even though PDCA and OODA are both methods for continuous improvement, they actually demand very different perspectives for businesses implementing them. Of the two methods, PDCA is more of a top-down approach that is conceived from the company’s leaders. There is an established vision for the company, followed by a roadmap that is then followed by action.
Compared to this method, OODA has an inverted perspective. When practicing this strategy, leaders are always reacting to situations or developments. This means that external factors typically dictate the priorities and timing of strategic decisions.
PDCA vs. OODA: Who would use PDCA or OODA?
Both methods are suitable for companies that want to adopt an established framework for internal improvement. OODA is ideal for environments where decisions must be made quickly or when consequences for failure are high. It was developed by the military to help pilots make quick decisions, so this is really the central feature. OODA is better when you need to make a lot of fast, high-stakes choices.
PDCA is suited for the exact opposite. This method is better for more long-term strategic decisions and for situations that demand innovation. PDCA is also frequently used in lean manufacturing to further refine workflow. It’s probably not a good idea to use both at the same time, but there’s no reason leaders can’t embrace them alternatively depending on the situation.
Choosing Between PDCA and OODA: Real World Scenarios
An urban hospital serves a sizable community and treats a lot of patients every year. The growing community has put increasing demands on the hospital, prompting management to implement PDCA to increase efficiency and patient experience. Using this method they are able to make several sweeping changes and modernization to improve operations.
Despite these successes, the hospital finds itself being overwhelmed at the onset of a disease outbreak in the area. Doctors are uncertain about the severity and scope of the disease, so the hospital can’t rely on top-down executive decisions to be prepared. That’s why they adopt an OODA framework to deal with the day-to-day developments and wild fluctuations in demand for services until the crisis is over.
Active and Reactive Decisions
The age-old debate of active versus reactive strategy isn’t one that will be resolved here. Fortunately, you don’t need to just pick one that you think is best. The key to making good decisions is the ability and willingness to be flexible, comprehensive and constructively self-critical. This mindset ensures that you’ll get plenty of value out of both PDCA and OODA for improving business processes.