Thursday, 23 August 2012

Outsourcing the OODA


The OODA as a tool is something I’ve discussed plenty of time on this blog, and I’ve grown increasingly interested in recent months on a trend which I think is only going to grow stronger with time. It goes without saying that business already outsource the “Act” part of the OODA, that’s understandable enough. However there is also a trend toward outsourcing the Observation and Orientation aspects of the loop.

For the record, and before I go further, I should say none of this pertains to current or previous clients of mine. I am discussing broad trends within my industry only.

I am, broadly speaking, an analyst. I analyse data on behalf of a range of clients. Even more broadly I’m a consultant, clients come to me and my colleagues to consult about the way the world works and we seek to tell them. There is no better expression of observation than what we do. That’s our entire function day to day, and across the consultancy industry you’ll find dozens of different specialisations, all of which seek to create a set of actionable observations.

Increasingly in my industry however, clients are asking us to make recommendations and provide guidance on the actions they should undertake. This is actually a relatively new trend in market research (new in the sense its only a decade or so old), and shows all the signs of strengthening over time.

This raises interesting questions about how well prepared businesses are for the challenges they face, and indeed the strength of their internal decision making process if they are choosing to rely on information which has been heavily vetted by third parties outside of their immediate control. It requires an enormous amount of trust, and is based on the assumption that a third party will not seek to provide information which is intended to please or flatter, rather than purely accurate information.

There’s always the risk that by outsourcing, you create messengers who do not under any circumstances want to risk being shot. There’s also the tendancy for clients to request information in the form of a “deck” or “story” rather than the raw data, which places the onus on the agency providing the information to find a way of delivering the information within the confines of what is already known and understood, limiting the potential for reflecting seismic change in a realistic manner.

That’s not to say that the model of outsourcing is a bad idea. It’s not. It’s a vital part of how modern businesses operate, however I don’t think there are sufficient safeguards in place within businesses to ensure that they are accessing the truth of the information they are receiving. What form this would take is hard to guess. I’d suggest it would be still closer ties to the organisations providing 3rd party insight, perhaps with direct secondments where necessary, so that there are greater opportunities to interrogate the information at it’s source. 

Whatever form it takes, the goal should be clear, to strengthen the ability of companies to access realistic and correct information about the state of the environment. Further to this, to be able to understand and orient correctly in the direction this information is taking them. Further outsourcing without some form of safeguard is extremely risky, and potentially could create a situtions in which companies are isolated from change.

A fascinating trend, but one companies should not blindly follow without understanding it’s dangers.

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