What is continuous improvement?
Continuous improvement is a method of improving business results by constantly reexamining and refining products, services, and processes.
To facilitate continuous improvement, many businesses adopt the PDCA
framework. PDCA stands for plan, do, check, act, and is a four-step,
ongoing cycle for carrying out change for the better. PDCA is not a
single, one-and-done approach, but rather an ongoing cycle that must be
constantly repeated to facilitate ongoing improvement.
Plan
In the planning stage, a business must recognize possible opportunities, and create a plan on how to change to address those opportunities. ‘Plan’ involves defining problems, assessing resources, setting goals, and choosing methods.
Do
At this stage, an organization tests the change. Applying the changes
in a small-scale controlled environment, while being ready to address
any unanticipated problems, the business generates valuable data for the
next step.
Check
“Check” means reviewing the results of the small-scale tests
performed in the previous stage. Results should be analyzed and insights
identified to help inform the final step. This may be the most
important stage in the entire PDCA cycle, as it allows organizations to
clarify their plans, eliminate issues, avoid recurring mistakes, and
identify root causes. Make any necessary changes to the original plan,
taking it through the previous steps as many times as necessary before
finalizing it.
Act
Armed with information and insights from the previous stages, organizations can now apply the refined plan. If it is successful, the business can then incorporate what they’ve learned into other areas. The proven change should become a new baseline, allowing for new improvements as the cycle restarts.
The PDCA cycle is an essential aspect of continuous improvement, providing an easy-to-use framework with which organizations can drive improvements across services, functions, processes, teams, and individuals. As such, effective continuous- improvement solutions incorporate this framework.
Root cause analysis (RCA) is an approach to continuous improvement
that focuses specifically on the main reasons and origins behind
problems in an individual process. Much like the standard approach to
continuous improvement, RCA is iterative. When it encounters problems,
RCA analyzes causes and effects until it identifies the root of the
issue. To do this, it follows six steps.
Defining the problem
The first step in RCA is identifying and observing a problem.
Evaluate the impact of the problem and outline the specific symptoms.
Gathering data
Next, research the problem and collect as much relevant information
as possible. Develop as clear of a picture of the problem as possible,
to help inform the next step of the process.
Identifying causes
Using information gathered in the previous step, identify and track
as many causal factors as possible. Create cause-and-effect diagrams to
help visualize what issues are behind the problems that are being
tracked. Look at possible consequences, and continue to break issues
down into their constituent parts to create a more detailed picture of
the overall problem.
Identifying the root cause
Continue to dig down until the core issue behind the original problem
or problems can be identified. Determining why the root cause exists in
the first place can help inform possible solutions.
Implementing a solution
Create a solution to resolve the root cause, thus cutting off the
problem or problems at the source. Recognize and account for any risks
that might be involved in carrying out the solution.
Monitoring the solution
As with any change, continuous monitoring is important in RCA to
ensure that the issue has been effectively resolved, and that the
solution has not created other problems.
There are a number of advantages from implementing continuous improvement in a business.
Improve employee engagement
Wasteful, inefficient processes eat up employee time. Worse than
that, they force employees to expend effort on ineffective tasks.
Continuous improvement cuts away and refines processes, leaving only the
impactful and important. At the same time, continuous improvement gives
employees a voice and lets them know that their input is valued.
Together, these factors contribute to increased employee satisfaction in
their work.
Decrease turnover
Improved employee satisfaction naturally leads to decreased employee
turnover rates. When employees feel fulfilled and appreciated, they are
much less likely to leave a company, even in the face of more-lucrative
offers. They begin to think of the organization as more than simply an
employer; it becomes a part of who they are, and they gain ownership
over its success.
Refine workflows
Lean methodology and continuous improvement allows for detailed and
repeatable workflows. Workflows establish proven steps and best
practices for accomplishing work quickly, efficiently, and effectively.
Continuous improvement allows organizations to streamline their
workflows, identifying improvement opportunities and eliminating
extraneous tasks and processes.
Reduce costs
Unnecessary waste processes are more than just time consuming;
they’re expensive. Continuous improvement helps businesses distinguish
important processes from superfluous ones, saving money in the process.
Additionally, with reliable workflows and a clear understanding of
exactly what is required to complete important jobs, managers can
improve the accuracy of their budgets.
Enhance customer service
Customers may not be interested in an organization’s internal
processes or workflows, but they are certainly interested in the value
the organization provides. Continuous improvement helps businesses
better understand customer needs, and create a refined process for
delivering on those needs.
Secure a competitive advantage
Continuous improvement is just that: an ongoing upward trend in terms
of products, services, and internal processes. By focusing and working
towards improving their business, organizations eliminate the risks
associated with stagnancy and complacency. This creates a competitive
advantage over companies that are not following a similar methodology.
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