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The OODA (observe, orient, decide and act) loop is a proven decision-making tool that has its origins in military air-to-air combat. Having the ability to make quick and smart decisions can make the difference between life and death when you are engaged in a dogfight as a fighter pilot. The consequences might not be so significant when you are making business decisions, but without doubt, success comes to those who make the right decisions in the timeliest manner.

The OODA loop was designed by military strategist John Boyd. Boyd was a former pilot and colonel in the US Air Force, and through observation of fighter pilots in action, he discovered that a pilot with access to more detailed information could defeat an opponent even if that opponent was in a superior aircraft. By studying dogfights between the American F-86s and the Soviet MIG-15s, he discovered that the American pilots were able to achieve more victories due to the additional information they gained simply by having a more expansive view from their cockpit. This additional information enabled them to assess a situation more thoroughly and therefore make better decisions.

The model was quickly adopted for use in both military and business strategies. Just like in battle, in business it is important to try and keep one step ahead of your market and competition. The greater the information available to you, the faster and more effective your decision-making will be. In this article we will take you through the steps of the OODA loop and show you how you can use the model in your everyday business environment.

The OODA loop

The name suggests that the OODA model is just one loop; however, in reality the model is best described as a cycle as shown in the diagram below.[wlm_ismember] To illustrate this, let’s go back to air-to-air combat where the model originated. The pilot begins by observing and taking in as much information as possible. The next step is to analyse the information and to orient themselves in line with their current reality. A decision is then made and action taken. The final step is to gather feedback on the result of the action, the pilot then evaluates the new information and the cycle of the OODA loop begins again. This cycle continues until a conclusion is reached.

Stage one – Observe

This stage of the model is about gaining as much information as possible before making a decision. Knowledge is power and the more information you have, the better informed your decisions will be. If you think about the fighter pilot, some of the information will have been conveyed to them prior to take-off and some will be fed from outside sources over the radio. However, the most important information will be what they see through the cockpit window. Just like the pilot, you need to gain information from as many available sources as possible.

Stage two – Orient

In this stage you take in and analyse the information you gathered to help you make the best decision. This is the hardest yet most important stage in the decision-making process. One of the problems in this stage is the different interpretation of information. A situation is influenced by our personal perceptions and experiences. Additionally, as Boyd discovered, we are also influenced by our cultural and genetic heritage, our physical ability to process information and the affect of any new information coming in.

Boyd suggests that the more aware you are of your own perceptions and abilities, the quicker and better you will become at orienting to each new reality. Once you are oriented to your situation, you are then able to move onto the decision-making phase. It is also important to remember that you may need to re-orient as new information comes in. For example, the fighter pilot has to orient and re-orient rapidly as the circumstances around them rapidly change.

Stage three – Decision

Now it’s time to make a decision on the best way forward. In this stage you will use all the information to hand to make the best decision you can. In the OODA loop model, you may do several cycles or loops, processing new information and making or modifying decisions as you re-orient yourself to each new reality. Think once again about the fighter pilot in combat. Things are moving at such a pace that once they make a decision to act, there will be new information to process and a new reality to orient to before they make the next decision. In business, things may not happen as rapidly as they do in air-to-air combat, but the theory behind the OODA loop is relevant to situations that require ongoing decision- making until they are resolved. A relevant example is when there is a problem or issue with a customer, and back and forth communication and negotiation are required to get a result.

Stages four – Act

This is the stage when your decision is implemented and feedback gained. The pilot might fire their missile, or you may make an offer to your customer in an effort to resolve an issue. From the feedback gathered after action you are taken back to stage one and the loop begins again. New information is gathered and processed before further decisions can be made and new actions taken. The loop continues until there is an end point. In the air-to-air combat example, the OODA loop ends when the battle ends. In the customer issue example, the loop ends when a resolution is reached.

Summary

It is important to understand that this model was designed for use in combat. It is not designed for use in long and drawn-out processes, but rather to help you make decisions more quickly. The OODA loop is regarded as a fluid decision-making process, where one stage moves to the next in a fluid motion and continues until the situation is resolved. It is a proactive decision-making process where you take in information, react to it quickly and thus make informed and timely decisions. Use the OODA loop to help speed up your reactions to situations that are at risk of worsening through poor or slow decision-making and actions. The customer issue is a perfect example. If you have a customer who is unhappy, the faster you can work out what happened, why it happened and what you can do to resolve it, the better your chances of keeping the customer satisfied.[/wlm_ismember]

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