An OODA loop is a decision-making model that comprises four key stages: observe, orient, decide, and act. OODA loops are primarily used when individuals or organizations need to make quick and effective decisions within a rapidly changing environment. Each phase of the OODA loop builds upon information gathered in the previous stage.
What is an OODA loop?
The OODA loop has been around for a while, originally developed in the 1970s by US Air Force Colonel John Boyd. The key focus of the OODA loop is to use the information available, filter it, and put it into relevant context to reach a decision. It offers an alternative way of approaching decisions (when you have limited information) and improves efficiency in the decision-making process.
Agility is a critical component of the OODA loop. Hinted at in its name, the OODA process involves constant gathering of feedback and information. In comparison to traditional decision-making models, OODA encourages choosing decisions and actions towards the end of the process, to ensure the decision-maker is appropriately informed. This also enables decision-makers to think of the bigger picture and the impacts (positive or negative) the decision may have.
When running an organization, department, or even a campaign, we’re constantly faced with decisions that we don’t always know the outcome to. The OODA loop offers a way of standardizing the decision process within an organization, showing those who use it a way of organizing data that can be used in myriad different areas – and adapted by anyone within the organization.
The four stages of the OODA Loop
Observe
At this stage the decision-maker is gathering all their data to aid in the next steps. This includes identifying the ‘problem’ (for example, losing clients to a competitor) as well as other critical information, such as market standings or client feedback. All information collated at this stage is a snapshot and is subject to change. There are different tools you can take advantage of to collect this data such as a retrospective meeting, or even a skills and resource matrix.
The more information you gather that’s relevant to the decision you’re making, the more accurate and informed your business decision will be.
Orient
Now all the relevant information has been sourced, it’s time to start analyzing it. Here you’re hoping to create situational awareness by applying your experience and relevant context to your research.
To analyze your data, consider methodologies like SWOT, SOAR, Porter’s Five Forces, or PESTLE. Try to identify trends or patterns in the data, highlighting any relationships within your data set. This includes considerations for next steps at the decision and act stages.
Decide
At this stage, you’re still working with a set of suggestions and not concrete ideas. However, now the decision-maker has an organized data set and applicable context, so they can begin to choose what course of action will have the best result. The key here is to evaluate and prioritize the information gathered in previous stages.
These suggestions should help to form a roadmap for the next steps, considering all possible outcomes, and involve stakeholders from across the organization to get different perspectives.
Act
It’s time to execute the decision and build your action plan. If you feel you need to revisit an earlier stage of the loop - not a problem. As its name suggests, each phase can be repeated as many times as required until a desired outcome is reached.
Why use an OODA loop?
OODA is helpful in a variety of different situations - especially thinking back to its origin. The beauty in the OODA loop is its flexibility in purpose. In comparison to traditional decision-making models (for example, the PDCA process of plan-do-check-act), OODA creates regular feedback loops throughout the process before a final decision - ahead of execution - has been made.
The flexibility (and adaptability) of OODA means that the model is accessible to various levels of seniority and business scenarios. However, it’s best suited to situations where a decision needs to be reached quickly and efficiently by an individual or small team. Despite OODA being created with time pressure in mind, take as long as you need to evaluate the context and decide the best course of action. A common OODA loop criticism is that time pressure can rush individuals into making a decision before they’re properly informed. The integrated feedback loops mitigate this.
With only four stages of the OODA loop, the decision-making process is effectively streamlined. It allows for decisions to be made quickly in dynamic situations without a full data set, reducing bottlenecks in organizations.
OODA encourages creativity in facing challenges, as well as opportunities for collaboration. As the model focuses heavily on situational awareness, this allows varied insights to be shared and considered by different business functions. This diversity in data contributes to a more informed outcome.
Implementing the OODA methodology in your organization will foster a cultural mindset of adaptive thinking, situational awareness, and flexibility. This structured approach will benefit colleagues by empowering them in their own decision-making abilities.
When can I use the OODA Loop?
Aside from its military roots, the OODA loop has many practical applications in various aspects of daily life. The most common application of the OODA loop, however, is in situations where there is a high level of uncertainty of both the approach and outcome.
Before committing to the OODA loop, frame the challenge or situation you’re facing. Clearly defining this will guide the actions you take towards resolution, bringing structure to the entire process. It also ensures there is no ambiguity amongst team members collaborating on the issue. Alternatively, consider the ideal outcome you’d like to see and work backwards to identify whether OODA is applicable. When there’s an explicit statement for the problem you’re trying to solve, it’s time to decide whether OODA is appropriate to use.
The OODA loop works best when spearheaded by an individual (or small team), and is most effective when integrated into the planning stages of a project. If you’re unsure about whether using the OODA loop is right for you, ask yourself:
Do I have all information currently available to me?
Are market conditions changing rapidly?
Do I need to reach a decision quickly?
If you answered ‘yes’ to those three questions - consider using the OODA loop as part of your process.
Examples of OODA loop application
You can use the OODA loop in two different types of scenarios. Either when you’re unsure of the ideal outcome but know the problem you’re trying to solve, or when you know the desired outcome but haven’t defined the challenge.
Let’s consider using OODA in a manufacturing setting. Your production line currently has a higher defect production rate and you need to reduce this. Here, the issue is clearly identified but the ideal outcome has not yet been defined. Looking at this example the opposite way, you know you need to reduce defects in manufacturing down to one part in 100, but don’t know the best way to tackle this.
Tackling this problem using the OODA loop enables you to lay out all the influencing factors that are contributing to the problem (or blocking a solution). As you move into the Decide stage, you would naturally have concluded the separate projects and initiatives you would have to run in order to tackle the areas mapped out in the Observe and Orient stages. This then sets you up perfectly for building out your plan in the Act stage.
Conclusion
OODA offers an alternative way of approaching decision-making and removes blockers from the planning stage as it has built-in flexibility throughout the process. It also offers opportunities for different teams and functions within an organization to collaborate and contribute to the outcome of a challenge. If you’re looking to bring structure to your organization’s decision-making process, it’s time to say hello to the OODA loop.
