According to a report from KPMG, 2025 is marked by eight key challenges for directors, including trade tensions, AI advancements, cybersecurity threats and more. Volatility is a prominent undercurrent this year, and it could seriously threaten agendas moving forward.
The business environment in the U.S. and worldwide has rarely been so promising yet so unpredictable, notes a recent report released by the National Association of Corporate Directors. The nature of these top challenges will require accelerated agility from directors and management alike. Outdated playbooks simply aren’t enough for boardrooms to keep pace with these challenges.
Board-level oversight must be able to adapt at the same speed as change occurs. Yet, the boardroom’s absence from day-to-day business operations has never made it more vulnerable than now, especially considering the amount of data being exchanged through technologies like AI.
This is where the Observe, Orient, Decide and Act (OODA) loop is highly useful. Business leaders could benefit from taking a page out of the jet fighter’s playbook to make better and faster decisions through a framework designed to brave the most stressful of situations: The battlefield.
Traditional Approaches Are Not Sufficient for Resilience and Agility
Traditional decision-making processes are not agile and flexible enough in today’s fast-changing world. An analysis from Harvard Business Review, which delves into how AI is accelerating sales and marketing decision-making, specifies that fast, reflexive action, driven by real-time insights, is needed to manifest results. The analysis’s authors highlight that reflection was more feasible in a slower-paced world.
Now, however, new standards of speed for immediate results mean corporate leaders, including directors, can’t afford to take as much time in making decisions. Otherwise, they risk failing to fulfill stakeholder and customer expectations, lagging behind competitors and missing out on opportunities. PwC insights note that mishandled crisis responses extend beyond operational issues, where brand and reputation can also be jeopardized.
Reflection is still important — it just needs to happen in an accelerated manner. Naturally, this pressure for speed, coupled with the ongoing volatility of today’s business world, is the perfect storm for burnout among leadership. The numbers don’t lie: It’s no wonder that 71% of business leaders are reaching their breaking point, according to this recent Fortune survey.
Boards meet periodically and tend to deliberate extensively over decisions. The information they’re processing to make decisions is often siloed, meaning they’re not necessarily as in touch with the reality on the ground as they should be. Slow reaction times also plague boardroom decision-making, hampering business agility and resilience.
With the evolution of technology, interconnectedness is nonnegotiable. In fact, a connected mindset, where strategy, technology and human insight are viewed holistically by leadership, is cited in this Inc. study as a core aspect of building resilience in today’s environment. A compartmentalized approach will lead to failure as new challenges accumulate and boardrooms are inundated with massive amounts of information.
Enter the OODA Loop
The OODA loop was developed by U.S. Air Force Colonel John Boyd for facilitating the best split-second decision-making outcomes. Although designed for the parameters of the battlefield, this framework is highly applicable to the business world.
The OODA loop is grounded in agility and flexibility, functioning as a cycle of continuous feedback from decision to observation and action to observation. Crucially, the “agility and flexibility” aspects of the loop are rooted in that cycle. That continuous feedback between observe, orient, decide and act strengthens directors’ ability to navigate volatility and complex decision-making processes.
It also allows directors to contextualize data and promptly take the most appropriate course of action, while being aware that abrupt changes may happen as new information emerges. This emphasis on contextualized data also fuels a more holistic view of risk and decision-making processes.
The OODA Loop in Action
“Implicit guidance and control (IGC)” is a key component of the OODA Loop framework. Here, seasoned directors lean into their experience and business acumen. IGC refers to the subconscious and intuitive way in which decisions are made, fueled by preexisting experience and mindsets. It is foundational to continuous adaptation and orientation in new situations or challenges.
IGC underpins the four stages of the OODA loop. Below is an example of applying them in a manufacturing company’s crisis response to massive shipment delays of raw materials.
Observe. This is the data collection stage, where the board is alerted by the CEO and management. An emergency meeting is called to procure facts and relevant information. This includes timelines of delays, customer impact, degree of damage to the bottom line, costs and cash flow projections. It’s the “what” of the situation, meaning the board needs to have all relevant information in-hand for ensuing decisions. By following these steps, directors can rapidly scope out the situation, including the degree of damage.
Orient. This is the moment for swift reflection, where the boardroom should synthesize and analyze the collected data, contextualize information and gauge risks to supply chains and customer relationships. Here’s where IGC really kicks in: The board knows protocols are in place to protect margins and the supply chain as much as possible. Directors also consider knock-on effects, such as shareholders’ stakes and the business’s bottom line, knowing to treat the situation as a matter of resilience, not just a logistics problem. Contextualization is crucial at this stage, acknowledging the “why” beyond the “what.”
Decide. Now it’s time for directors to help leadership opt for the best course of action. That might include short-term and longer-term strategies, like quickly communicating with clients and sourcing local suppliers in the former and reviewing supply chain resilience for the latter. Competitiveness and short-term commitments both must be protected. A clear road map is implemented to protect revenue, reputation and operations. Again, IGC is in play here, as directors draw upon factors, such as their previous experience, to direct the road map.
Act.Directors need to stay engaged with management in terms of how the road map is executed. That could include increasing the frequency of meetings for regular check-ins on supply chain updates, relations management and financial performance. Directors must keepa pulse on how things continue to pan out and realign strategies according to unfolding circumstances.
This framework helps directors make decisions more effectively and efficiently and take action with better awareness and preparedness. It’s an excellent way to bolster processes for maximizing outcomes while strengthening resilience in turbulent times.