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boyd

Col. John Boyd

Origins of the OODA Loop
Colonel John Boyd, USAF, left a profound and lasting legacy in the field of Decision Science with the legacy of the OODA Loop or Boyd’s Decision Theory. Boyd observed that, during the Korean War, the United States maintained air supremacy with a victory to loss ratio of 10:1, i.e. one American plane lost for every 10 destroyed. Many within the Air Force opined that superior technology permitted this dominance, but Boyd suspected otherwise.

During the war, the technology of the Soviet MiG surpassed the flight capabilities of the American planes in three critical aspects – speed, operational ceiling height and turning. The advantage possessed by the Americans lay in two under-appreciated features – a canopy that permitted greater visibility than that of its rival and advanced hydraulics. The greater field of vision permitted USAF pilots to observe and orient on targets faster whereas the hydraulics delivered more immediate responsiveness from controls (the plane reacted more quickly to input from the pilot). American pilots realized through experience that quick, aggressive movements against enemy air combat tactics overcame the superiority of the MiG’s individual flight capabilities by forcing an incapacitating number of decisions in rapid succession upon the enemy combatant.

The ability to react with greater agility across multiple flight characteristics proved more meaningful than “faster, higher, tighter” individually considered. Exploited by the Americans with tremendous success, the experience proved the origin of Boyd’s Decision Theory – the OODA Loop.

boyds-decision-cycle

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Characteristics of Agile Thinking
While this discussion is interesting to some and perhaps less than a historical footnote to others, those active in the fields of competitive sports or business understand the criticality of quick decision making. It differentiates those who consistently excel from those mired in mediocrity. Within business (the primary focus of this overview), greater agility generally equates to far superior profits.Boyd suggested that the most effective organizations possess:

  1. A highly decentralized chain of command
  2. Provide strategic or operational objectives while exercising directive control

He further posited that organizations with these attributes create flexibility within their organizations in permitting quick adaptation to dynamic situations. This framework requires the significance of deep, mutual understanding between field, operations and executive management to be successful. Provided this exists, the demonstrated agility of these organizations provides superlative innovation and execution in comparison to others embracing more traditional models.

Consider the example of an organization identifying market trends faster than its competitors – with greater clarity – in coordinating the development of primary recommendation and secondary alternatives to meet unmet market demand will also likely make execution decisions faster with respect to authorization, launch and commercialization. Furthermore, fist-to-market organizations typically enjoy benefits that laggards do not such as presence, market share, economies of scale, brand loyalty and perhaps barriers to entry.

mcdp-1

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Speed through the Decision Cycle Reduces Friction
Business Strategy and Leadership literature is replete with marketing, business development and differentiation strategies with much of it more valid than not, however, I suggest that the key differentiator  for organizations that enjoy sustained competitive advantage is speed through the decision cycle or OODA Loop.

Keeping with the military theme, Marine Corps Doctrinal Publication-1 (MCDP-1), more commonly referred to as Warfighting, is a distillation of the writings of the ancient Chinese General Sun Tzu and the Prussian General Carl von Clausewitz. Integrating current thought with the critical operational, tactical and strategic thinking of these great minds, MCDP-1 suggests that incapacitation rather than annhilation as the primary aim of modern Maneuver Warfare. This philosophy parallels the conduct of business insofar as the understanding that success of failure in business, as in war, depends largely on how organizations deal with the issue of friction.

In practice, the conduct of (business) becomes extremely difficult because of the countless factors that impinge upon it. These factors collectively have been called friction, which Clausewitz described as ‘the force that makes the apparently easy so difficult’. Friction is the force that resists all action and saps energy. It makes the simple difficult and the difficult seemingly impossible.(1)

The Benefit of Quick, Effective Decisions
Boyd’s Decision Theory suggests that quick, effective decision making reduces friction and, when further enabled by simplified processes, greater transparency and reliable support structures employing capabilities that adapt quickly to dynamic conditions, creates true competitive advantage. Attributes of organizations possessing these traits include decentralization, flexible operations, activity based management, and Beyond Budgeting principles. They may not reference these characteristics by the formal name, but look closely and these exhibit in some fashion across the enterprise.

By compressing the decision cycle, an organization delegates authority down closer to the field level to ensure that the managers or personnel closest to the situational realities are empowered to act in furtherance of the organization’s objectives. Not coincidentally, this improves execution, innovation and CRM, contributing directly to addressing the short-term business needs of the organization while aligning initiatives to the long-term strategic plan.

Most organizations fail to fully comprehend that “they don’t know what they know”. The latent talent and deep competencies of individuals within the organization are almost always sufficient to embrace agile principles to better decisions faster. What businesses seeking agility MUST do is convey core values and objectives across the enterprise to all employees. Education, Training, and Job Satisfaction (reduced turnover) are core benefits to the agile organization.

Leaders must prepare their organizations to understand the core steps and processes of the OODA Loop.

  1. Observe
  2. Orient
  3. Decide
  4. Act

Each of these steps is a process by itself with direct correlation to many of the process improvement or decision cycle concepts such as Lean, Six Sigma and Solutions Selling. Process Improvement suggests simplification, transparency and standardization of repetitive behaviors. Interestingly, where Lean and Six Sigma proponents argue the value of DFSS and DMAIC methodology, one can easily overlay the OODA Loop and find significant similarities. The same holds true for the Solutions Sales and Customer Buying Processes. The inherent truth with all these within all these methodologies is that quick, effective decisions create competitive advantage, accomplished through simplicity and transparency in creating enduring transformation.

ooda-dmaic-ssp

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No Guarantees Written or Implied
Clausewitz, in his famous treatise on war, argued operations, tactics and strategy as each vulnerable to quick, aggressive counteraction. His famous analogy of friction as the “fog of war” underscores that competitive advantage is created by the organization that minimizes it for itself, yet propogates it for competitors.

Agile organizations executing the Decision Cycle more efficiently than its competitors are not assured of success. Assumptions often form from limited, fragmented information influenced by cultural norms and subjective experience; observations prone to misperception; orientation misguided by bad judgment which invariably leads to decision lacking integrity. Executing the OODA Loop continously though permits opportunity for mis-steps to be recognized and corrected before recognized by a competitor.

The OODA Loop provides a framework to position organizations for sustaining competitive advantage. Leaders must understand the implications of quick, decisions yielding effective action in driving growth and mitigating risk. The OODA Loop, with similarities to other practical concepts, provides a practical design permitting organizations to exploit opportunities, improve flexibility and yield differentiation.

Superior profits. Cost Containment. Innovation. High Integrity Execution. Customer Satisfaction.

How nimble is your organization?

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Source Material:
Marine Corps Doctrinal Publication – 1 (MCDP-1), 1997
The Strategy of the Fighter Pilot, Keith H. Hammonds, Fast Company, December 2007
Teams are the Building Blocks of Agile Organizations, Mike Cottmeyer, http://www.leadingagile.com
Getting Inside Your Competitor’s Decision Cycle, BCG, December 2003

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