With 26 seconds left on the clock, down by four points, and facing a second down within one yard of scoring the game-winning touchdown, Seattle’s coach Pete Carroll decided to call a pass play instead of a run play—a brilliant decision given the circumstances. (Statistically, the pass play had a 2% chance of failure.) The pass was intercepted by New England and, as a result, Seattle lost Super Bowl XLIX. Pete Carroll made a bad decision, right?
There is an error in thinking this way known as Outcome Bias—an error made when individuals, teams, and organizations evaluate the quality of their decisions when the outcome of that decision is already known. Outcome bias is dangerous to businesses and organizations operating in today’s volatile, uncertain, complex, and ambiguous (VUCA) environment where probability, luck, and serendipity are part of the game—a game that looks more like poker than chess.
To help separate decisions from outcomes, leaders should abandon linear thinking processes such as the Plan-Do-Check-Act cycle and apply non-linear frameworks such as the OODA loop. With three distinct feedback links moving from decision (Decide) to observation (Observe) and action (Act) to observation (Observe), the OODA loop naturally separates decisions (how we make decisions) from the effects of our actions (the outcomes).
For those who are familiar with the OODA loop, you may be asking how does the OODA loop separate decisions from outcomes when decisions are made through the use of Implicit Guidance and Control (IG&C)—the link that moves from orientation (Orient) to action (Act)? Simple. There are two feedback links moving from action (Act) to observation (Observe), where the inner feedback link represents decisions made through IG&C and the outer or lower feedback link represents outcomes—those unfolding interactions with the environment.
If Pete Carroll’s decision to pass had a favorable outcome, either in the form of an incomplete pass or a touchdown, the application of OODA loop thinking still encourages leaders to focus on making decisions right (how decisions are made) over making the right decisions (outcomes).