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The PDCAContinuous Improvement CycleModule 6.4Jeremy WeinsteinSteve VasovskiAlumni Mentor/CoachJamie Flinchbaugh – Lean Learning CenterPresentation for:ESD.60 – Lean/Six Sigma SystemsMIT Leaders for Manufacturing Program (LFM)Summer 2004These materials were developed as part of MIT's ESD.60 course on "Lean/Six Sigma Systems." In some cases,the materials were produced by the lead instructor, Joel Cutcher-Gershenfeld, and in some cases by student teamsworking with LFM alumni/ae. Where the materials were developed by student teams, additional inputs from thefaculty and from the technical instructor, Chris Musso, are reflected in some of the text or in an appendixJamie Flinchbaugh – one of the founders of the Lean Learning Center - lean consulting

Overview¾ Session Design (20-30 min.)¾ Learning Objectives¾ Understand the differentsteps in the PDCA(continuous improvement)cycle¾ Learn how to apply the stepsto solve real world problems¾ Understand the potentialdisconnects using examplesand exercises¾ Part I: Introduction and LearningObjectives (1-2 min.)¾ Part II: Key Concept or PrincipleDefined and Explained (5-7 min.)¾ Part III: Exercise or ActivityBased on Field Data thatIllustrates the Concept orPrinciple (5-15 min.)¾ Part IV: Common “Disconnects,”Relevant Measures of Success,and Potential ActionAssignment(s) to Apply LessonsLearned (5-7 min.)¾ Part V: Evaluation andConcluding Comments (1-2 min.)What i s PDCA?Different steps.How are they appliedWhat are the common disconnects. Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 2Part V: Conclusion

PDCA IntroductionShewhart Cycle/Deming WheelPDCA is a continuous improvement toolDO(Test)PLANCHECK(What, Why?)(Analyze)ACT(Implement)Continuous improveme nt – keeps looping around (find new improveme nts) Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 3Part V: Conclusion

Walter ShewhartDiscussed the concept of thecontinuous improvement cycle (PlanDo Check Act) in his 1939 book,"Statistical Method From the Viewpointof Quality Control“W. Edwards DemingModified and popularized theShewart cycle (PDCA) to whatis now referred to as theDeming Cycle (Plan, Do, Study,Act).Key Figures in PDCA Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 4Part V: Conclusion

PDCA definedPlanPLAN Identify The Problem (What?) PLANAnalyze The Problem (Why?) Identify the problem to be examinedFormulate a specific problem statement to clearly define theproblemSet measurable and attainable goalsIdentify stakeholders and develop necessary communicationchannels to communicate and gain approvalDivide overall system into individual processes - map theprocessBrainstorm potential causes for the problemCollect and analyze data to validate the root causeFormulate a hypothesisVerify or revise the original problem statementTools: Direct observation of process Process mapping Flowcharting Cause and Effect diagrams Pareto analysisWhat & why step - what (identify) & why (hypothesis) of problemEach step has various tools – don’t elaborate, you can do a SPL on each of the tools Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 5Part V: Conclusion

PDCAdefinedDoDODevelopSolutions Establish experimental success criteria Design experiment to test hypothesis Gain stakeholder approval and support for the chosen solutionDOImplement aSolution Implement the experiment/solution on a trial or pilot basisTools: Design of Experiment (DOE) On job training Stakeholder management & communicationFun step - Pe rf orm experime nt/test Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 6Part V: Conclusion

PDCA definedCheck Gather/analyze data on the solutionEvaluate The Results Validate hypothesisCHECKAchieve the desired If YES go to act Else go to plan, revise hypothesis/problem statementgoalTools: Direct observation of process Graphical analysis Control charts Key performance indicatorsDecision step – either go to act if the desired goal is achieved or go back to the plan andrevise the hypothesis or problem stmt Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 7Part V: Conclusion

PDCAdefinedActACTImplement The FullScale Solution (andCapitalize on NewOpportunities) Identify systemic changes and training needs for fullimplementation Plan ongoing monitoring of the solution Continuous improvement Look other improvement opportunitiesTools: Process mapping (new process) Standardization of work and process Visual management Error proofing Formal trainingThe real de al step- implement the full scale solutionVisual mgmt (ex. Signs when traveling on highway)Error (idiot) proofingFormal training (workforce) Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 8Part V: Conclusion

PDCA – OverviewPlanModifyparametersDoCheckNoAnother problemor improvementAchievedgoal?YesAct Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 9Part V: Conclusion

Industry Tool – A3 Report¾ Create an A3 report on a problem solved, a project startedor an action item on a kaizen.¾ Use 11x17 paper (or 2 8 ½ x 11’s) and the format shown onthe follow pages - 11x17 is big enough for the requiredinformation but still allows you to keep it to one page¾ Write it in pencil - you won’t cheat with smaller font sizes andit encourages you to draw pictures to describe theopportunity¾ Every A3 should also help explain how the lean rules andprinciples are used to improve the businessUse as a living document. Don’t just put the project on an A3 at theend, use it at every step of the process.Source: Jamie Flinchbaugh, Lean Learning Center Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 10Part V: Conclusion

Industry Tool – A3 Report (cont.)Project Area:Owner:PLANBackground (What?)&Business Case e andMeasurementsInformation should FLOW and be simple.Source: Jamie Flinchbaugh, Lean Learning Center Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MIT6/9/04 -- 11Top left - Background (what), Business case (why) – this is the plan stepBottom right – how you are going to get there and what you are going to use to measureagainst hypothesis

Source:JamieFlinchbaugh,Lean LearningCenterSigma Systems, LFM, MIT SteveVasovskiand Jeremy Weinstein– ESD.60 Lean/SixExample from Jamie6/9/04 -- 12

Sample Activities – PDCA¾ Divide into small groups and take 2-3 minutes to discuss.¾ Current Situation – Technicians have identified a timesavings opportunity by moving a component rack closerto the manufacturing line.¾ Discuss the next steps using the continuous improvement cycleto accomplish this task (PDCA).¾ The new setup was found to decrease cycle time by 2xexpectations. What are the next steps?¾ The new setup was found to increase the cycle time for theseries of operations in question. What are the next steps?Important part is to revisit the hypothesis in each case and ask why is it different thanexpected.Learning can be derived from both successful and unsuccessful PDCA cycles. Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 13Part V: Conclusion

PDCA Card Exercise¾ DO NOT LOOK AT YOUR CARDS.¾ Break into small groups for a game:¾ Objective – Divide the cards in your group as fast as possible sothat every member of the group has the same numerical sum.¾Aces are 1, 10s and face cards are 10, 2-9 are the amount shown.¾ DO NOT TOUCH YOUR CARDS¾ Do: GO – Raise your hand when you are done.¾ Check: Did you meet your goals? Discuss how to improve?¾ Plan: You have 4 minutes – DO NOT TOUCH YOUR CARDS¾ Do: GO – Raise your hand when you are done.¾ Check: Did you meet your goals?¾ Act: Document your solutions.For the first iteration, give the groups only 30 sec to try to divide the cards. Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 14Part V: Conclusion

Common Disconnects in IndustryTechnical FactorsSocial Factors¾ Constrained resources and improper¾ BIG “P”DCA – Overplanningtraining cause PDCA to begin and¾ Team gets stuck in planning cycleend at “Do”.– try to confirm beliefs in planningwhereas lean model confirmsbeliefs in check¾ LITTLE “P”DCA – Underplanning¾ Missing experimental hypothesis:no “why”.¾ Things work well for reasonsbeyond understanding with noknowledge of what worked andwhy.¾ The hypothesis is not validated. Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 15Part V: Conclusion

Other Industry Uses of PDCA¾ PDCA in Process DevelopmentLean ModelOthers# of engineering changes¾ Aluminum FoundryCompany performs PDCA onan annual basis from top tobottom. Metrics and tasks aredeveloped to meet overallgoals. Status of metric is red,yellow or green.On a daily/weekly basis,individual teams present theirmetrics (checks) and plans.On a quarterly basis metrics arereviewed and those that havemissed the mark are examinedfor root causes and new plansare made to meet yearly goals.Launch¾ Toyota has demonstrated that amore rapid and effective use ofthe PDCA model in processdevelopment can lead to adramatic decrease inengineering changes postlaunch.The toyota example exemplifies how PDCA can be used in the product developmentcycle to save considerable dollars. Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 16Part V: Conclusion

Concluding Comments¾ The PDCA cycle can be an effective and rapid method forimplementing continuous improvement.¾ Each step: Plan, Do, Check, and Act are critical for consistentimplementation of successful process improvements.¾ Avoid the common disconnects as seen by one professional inindustry, such as over/under-planning and not validating thehypothesis, even on successful results.¾ Different industries will use the cycle uniquely, but companiesthat use it well develop tools around PDCA to use it effectively. Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 17Part V: Conclusion

Appendix: Instructor’s Comments and ClassDiscussion from 6.4¾ Problems can stem from overplanning orunderplanning—important to find the right PDCAbalance¾ A decade to learn to “Plan,” a decade to learn to “Do” . . .¾ Constrained resources can lead to a lot of doing, and notmuch else¾ Documentation is key to PDCA, so that knowledge canbe recorded and internalize Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MIT6/9/04 -- 18

Appendix: Instructor’s GuideSlideTimeTopicAdditional Talking Points1-42-3 minIntroduction, overview andlearning objectives Identify overall themes – don’t just read from theslide5-105-7 minKey Concepts Stress the value in each step and the linkbetween steps.11-155-15minExercises/Activities The A3 report is included as an example anddoes not need much elaboration. The card game is more fun, but more time, cut itout and do the class discussion if time runs over.16-173-5 minDisconnects Stress the importance of validating the hypothesisand in effective planning.181-2 minConcluding comments Refer to the NOTES for each slide for more details. Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 19Part V: Conclusion

ReferencesDennis, Pascal. Lean Production Simplified: A Plain LanguageGuide to theWorld’s Most Powerful Production Systems.Productivity ixsigma.com/ Steve Vasovski and Jeremy Weinstein – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: ApplicationPart IV: Disconnects6/9/04 -- 20Part V: Conclusion