In your daily life, you make a number of decisions without thinking much about it. For more complex decisions, you may have a process for decision making, or you may not. But at a certain level of complexity, especially in large hierarchal systems, it becomes critical to have some sort of decision making framework. One of the more common frameworks is the OODA loop.

The OODA loop has 4 phases: Observe, Orient, Decide, Act. Each phase can either feedback an observation, forcing a return to the beginning, or can feed forward information to the next phase. So within the OODA loop there are multiple opportunities to adjust direction. This feedback/adjust mechanism makes OODA decisions agile. However, in some cases, that advantage can become a vulnerability.

If the system can be overwhelmed with information, an organization can become trapped in the “Observe, Orient, Decide” loop without ever making a decision. When organizations that use a decision making system like OODA get stuck in these loops, they can either stay trapped within the loop and be unable to make any official decision, or they can be forced to return to use bad data or intuition. Both of failure cases manifest as “turboparalysis”: the frantic, often conflicting, action without any results.

(Authoritarians are quick to point out that this is why decisions should be made by a strong man. This would ultimately be the same as the OODA failure scenario, but, as we shall see, can be worse.)

Now lets reconsider the OODA loop in the context of the VSM. The VSM recommends maximizing the autonomy of operational units. External observation and planning is a function of the metasystem, specifically systems 3 optimization and regulation) and 4 (adaptation and forward planning). So within an optimally viable organization, according to the VSM, OODA mostly takes place within a tight system 3 and 4 loop, based on observations of the external environment and internal system state, before returning to operational units. It does so at the lowest level of recursion possible. In most cases, this means that the smallest group with the ability to orient and make decisions does executes the loop.

Organizations that maximize autonomy structurally by minimizing hierarchy are, by default, VSM optimal for decision making (if they are otherwise viable). Anarchist disaster response, for example, maximizes the autonomy of individual workers. Information may be shared to support system 3 and 4 within the larger org, but most decisions will stay within the domain of operational units. It is generally only in cases of conflict or observed optimization opportunities that the metasystems would be activated at all.

However, hierarchal organizations tend to centralize decision making. As the hierarchy becomes more strict, the autonomy of operational units decreases. For each level stripped of autonomy in a domain, OODA loop decisions must transition an additional level of (VSM) systemic recursion. Concretely, in an optimal VSM organization each individual is authorized to make any decision that will not endanger the viability of the larger system. Do you buy supplies? You decide, you already have a budget. The budget isn't enough, coordinate with others until you get enough people who agree to get the budget or until you are convinced otherwise. In a hierarchal organization, decisions are centralized. Do you buy supplies? Ask for a budget allocation and give it to your manager. Your manager will relate that request to the regional manager. The regional manager will group this with other requests to present to the mid level finance committed. The finance committee will add it to the planning session for the budget next year, and so on.

The more strict the hierarchy, the more levels of hierarchy a decision must pass through. While it's is bad enough just to go through more people, the other side is that each level of hierarchy decreases the communication bandwidth for the level above. Rather than making decisions locally, the metasystem has to manage communication for each operational unit below. Observations go up the chain. The observational bandwidth decreases at each level, so each step loses information on the way up (or doesn't make it up the chain at all). When observations reach a level authorized to make decisions, those decisions now have to travel back down the chain of command. Decisions can't be detailed and granular but must, necessarily, be general enough to be interpreted at each level back. This adds additional “orient and decide” steps prior to reaching the operational units able to act. Each level of ambiguity adds opportunities to misunderstand or misinterpret the generalized guidance. If guidance is made specific then other problems can arise, such as instructions being inappropriate for a given situation.

Hierarchal organizations may mitigate this problem by creating intelligence units with the specific purpose of gathering information (OODA observing) and processing it in to intelligence (OODA orienting). Systems 3 (optimization) and 4 (adaptation and planning) still take place at higher levels, but this structure decreases the type of data loss described earlier. Downward data loss remains the same. But intelligence units causes a different type of data loss. Intelligence can provide highly detailed information on what intelligence analysts believe to be the most critical areas, but this high focus is at the expense of other areas. So a hierarchal organization can either have highly focused information on a small number of things, or a small amount of information about a lot of things, but never both.

As a situation becomes more dynamic, observation and orientation takes up more bandwidth. There are necessarily more observations and more things for which to orient. The degree to which an organization can manage dynamic situations (natural disasters, asymmetric warfare) is an inverse to both how dynamic the situation is and how hierarchal the organization is. Therefore, anarchist disaster response like Occupy Sandy and MADR (Mutual Aid Disaster Relief) excel in disasters while FEMA collapses. Likewise, guerilla and other asymmetric forces regularly defeat highly organized militaries like that of the US.

As an organization moves even further on the hierarchy scale even more problems arise. Authoritarianism ultimately collapses the entire metasystem into leaders (as described earlier). These leaders are not chosen for their competence but for their ideological adherence and loyalty to the leader. Ideological adherence necessarily creates an observational filter, making some observation and orientation functions impossible. It is not possible for authoritarian governments to be optimally viable, by definition, for multiple reasons. Critical to this section is the fact that they cannot actually observe and plan when those observations and plans may conflict with the beliefs of “Dear Leader.”

As authoritarianism progresses, reported reality must further and further align with the ideological frame of the leader. Thus observed reality of both the environment and the self degrades until it disappears. But even if that didn't happen, solidifying hierarchy decreases the granularity of both internal and external observations.

The more authoritarian a system, the more vulnerable it becomes.

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.” ― Sun Tzu, The Art of War