Recent economic events have demonstrated that the world is a far riskier place than we thought and that the only certainty about the economic future is that it is uncertain.
Organisations know that agility is more vital than ever. Unfortunately, the concept of agility is seldom well-defined and it is hard for businesses to know what, in practice, they can do to improve.
One of the most practical ways of thinking about agility is taken from the world of the fighter pilot. The OODA loop is an iterative cycle - ‘observe, orient, decide and act’ - developed by US Air Force pilot Colonel John Boyd. Boyd never lost his standing bet that, from an initial position of disadvantage, he could defeat any opponent within 40 seconds.
Analysing your decision-making cycle in OODA terms can help organisations become more agile and gain competitive advantage as you seek to get fit for the future.
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Only by correctly observing the world around them can organisations spot the events and trends that will affect them. Leaders should ask how competent the organisation is at observation and how frequent and deep that observation is. Is the field of view too narrow, and the organisation caught out by ‘left-field’ events?
Organisations must analyse and understand the information they gather, then assess its potential impact on business. The risk is that organisations will make the data fit their expectations, rejecting anything that does not conform to their world-view. An organisation can reduce risk by making its management team as diverse as possible, challenging existing customs and beliefs and striving to avoid complacency.
There are two dimensions to a successful decision: making the right decision, and making it in the right timescale. Unnecessary controls should be challenged and removed. People need to be empowered to make decisions at the lowest practical level. For decisions which do not involve a major irreversible commitment of resources, there is a case for acting first to see if the proposed change works.
There can be a disconnect between the ‘decide’ and ‘act’ stages of the loop. Reasons include funding obstacles, delays arising from ‘silo’ working, or grassroots resistance. Success often boils down to finding ways to act quickly. Again, decentralisation can help, as can encouraging informal cross-functional networks.
Getting the most out of OODA:
There are a number of key questions that can help an organisation to successfully apply the OODA framework to its decision making:
How effective is our OODA process?
Are the stages integrated into an effective decision-making cycle?
Can emerging technology or techniques help us?
It is important to remember that OODA is an iterative process. After optimising your OODA loop, it is worth continuing to monitor your organisation as it cycles through it. This form of ‘circuit training’ can help to maintain agility.
To find out more about how PA can help your organisation increase agility in decision-making, or to join our ‘fitness club’ and receive regular updates on how to ensure your business is fit for the future, contact us now.