The Doom Loop

Most of the time, I reflect on this very profound rhetorical question: Why would an otherwise thriving business enterprise end up in distress? Also, what explanation can one offer when a business leader whom we all look up to falls from a towering position?

Let us examine this systemic cascade which we refer to as the “Doom Loop.” It is the result of an unchecked chain reaction in an organisation. It unfolds gradually from the failure of a company and its leadership to regularly discharge their watchdog responsibilities of ensuring an all-encompassing accountability. Every unit and interaction within an organisation is interconnected and failure of a unit (or units) affects the others (it is a cascading effect).

The Doom Loop starts with a crack, and once the cycle begins, the entire system starts pulling itself apart from within.

A business leader must therefore operate with the awareness that the business environment is evolving daily. You must identify emerging threats and discover emerging profitable opportunities. The organisation must strive always to expand beyond its existing business model through continuous adaptation and innovation. There must be collaboration through strategic partnerships because we must move beyond limitations and conventional thinking. The leader must operate with the entrepreneurial capabilities of agility and agency.

CEOs must regularly translate bold strategic choices into sustained performance and recognise employee mobilisation as the critical differentiator for strategic success. They must measure the quality of their strategies and always move up the power curve.

Today, we have innovative business models that business leaders should adopt. These include redefining customer engagement, transforming the value delivered to customers.

Do not remain on plateaus for the sake of stability and convenience. The flywheel concept is a strategic principle that mandates leaders to build all-involving momentum in the workplace. Consistently engage and energise your people. Small wins accumulate and eventually become visible results. Keep turning the flywheel and ensure that its momentum remains consistent with your organisation’s values and principles.

Creative leadership intentionally drives energised team development.

John D. Rockefeller successfully used four (4) powerful people skills to build one of the largest business empires. He encouraged and developed talented employees; retained good employees and clients; disagreed without creating enemies; and aligned colleagues’ ideas and perspectives.

I challenged my colleagues and team members at our recent two-day brainstorming retreat to be committed to recalibrating, realigning and reinventing ourselves. The adoption of (our version of) the Agency Theory must always encourage selflessness and not the prosperity of favourites. We are all significant contributors to the growth of the organisation. We must exemplify optimism, energy, courage, dignity, integrity and high standards of complementary work ethics.

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My charge was that “we must not melt from the heat of change and the tough business environment.”

I recommended our unique “Corporate Ladder.” It is not about hierarchy but human dignity, ownership and impact.

We use hierarchy for coordination, not control; equity over titles; and agency over status. The top is not a position. It is the person you become through purpose, responsibility and influence.

We work as teams, not as individuals defined by titles. Every day, we must ask ourselves: Why am I doing what I do? Who am I impacting? What am I changing? And, in a constantly shifting market, how are we using our knowledge to create meaningful change?

We do not climb the ladder to rise above others. We climb to become better, create greater impact and move the organisation forward.

To stay completely clear of the Doom Loop, organisations must constantly evaluate and monitor performance. The Results-Based Management (RBM) method is particularly useful in this regard. It is made up of an array of objective performance dimensions, namely production measures and quality measures. These measures incorporate two (2) primary results-based approaches: the Direct Methods Approach (DMA) and Management by Objectives (MBO).

Through these approaches, a company assesses the outcomes of work and quantifiable results such as sales and productivity. Sales revenue is clearly an important indicator. Management by Objectives (MBO) involves setting specific goals to be accomplished within a particular period.

The Results-Based Management (RBM) approach has distinct advantages. These include roadmap setting, monitoring and evaluation, and feedback. RBM integrates strategy, resources, processes and measurements to improve decision-making, transparency and accountability.

Performance measurement is the continuous process of collecting, collating and analysing information on key indicators and comparing actual results with expected results. This enables organisations to determine how effectively projects and policies are being implemented.

It is very important that organisations do not suddenly become aware of changes in the marketplace after those changes have already occurred. You must monitor causal relationships rather than rely solely on expectations and assumptions. There are multiple levels of causality that determine daily outputs, outcomes and impact.

The questions you must constantly ask when tracking performance are: Are our decisions achieving the expected results? Is our workforce aligned?

Companies must deliberately and consistently ensure that they operate at the right pace and in perfect rhythm to successfully avert the Doom Loop. Everyone in the workplace must work at the right tempo, remain synchronised with one another and stay aligned with the operating environment. Organisations must always maintain the right level of organisational entrainment to remain responsive, cohesive and effective in navigating change.