Growth tips 30 seconds to business enlightenment.

Lessons in strategic thinking from fighter pilots

20-Jan-2011

The OODA loop (Observe, Orient, Decide, Act) was a concept originally applied to fighter pilots, developed by Colonel John Boyd of the USAF.  OODA has since become an important concept in both military strategy and business strategy.  

Today’s rapidly changing business environment creates the opportunity for firms to gain a competitive advantage if they can understand the impact of the changing environment, and respond with the right actions - more rapidly than competitors.

Consider a fighter pilot involved in a dogfight with enemy aircraft.  One of Boyd's winning insights concerning aerial combat - was the need to change speed and direction faster than the opponent.  Using the OODA process, the pilot must think and act faster than the opponent can think and act.  This puts adversaries off balance and increases the likelihood of victory.

The same principle operates (over a longer timescale) in today’s hyper competitive, increasingly globalized business landscape.  The proactive and conscious application of the OODA process can give your business an advantage over a competitor who is merely reacting to conditions as they occur, or has poor awareness of the strategic impact of the forces that will shape your industry in the near future.

Observe:

As a business leader, you must lift your head out of your day to day “business as usual” activities, and perform a disciplined strategic analysis of the key factors that are impacting - or are likely to impact your industry in the near future.  We recommend a thorough strategic analysis once a year, with a strategic review every quarter.

Orient:

This is where you synthesize the data and form hypotheses about the evolving situation. How do you see these factors playing out over the next 3-5 years?  What moves are the other players in your industry likely to make?  What moves do you need to make to address these scenarios?

Decide:

It is the leader’s job to decide. The military teaches their officers that any decision is better than no decision.  The decision to “do nothing” is still an option to be considered – but it needs to be a conscious choice.  Just sitting there conducting business as usual, and hoping things will get better is not a strategy!  

Act:

Unfortunately, Harvard research shows that 90% of strategies fail due to poor execution.  The 10% of firms who can effectively set and execute a winning strategy - are those that employ a disciplined strategic execution methodology - and have ingrained these processes as part of their company DNA.

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