Iterative decision-making as a practice of adaptive leadership

8.5 minute read

This post was originally posted on

In a recent post, Applied Systems Thinking, I outlined how The Holos Group utilised the Integral Framework to support of a group of leaders to gain a deeper appreciation of the factors involved in implementing a complex IT platform. I also outlined how The Holos Group’s work is both informed by and underpins the work of adaptive leadership – leaders who, according to Heifetz & Linsky, mobilise people to tackle tough challenges and thrive.

Foundational to leading adaptively as a leader capacity to make robust, well formed decisions quickly in service of supporting the ‘system’ being transformed (e.g., an organisational system) to maintain momentum towards its yet to be defined ideal future. In partnering with our client organisation the need for agility in making effective decisions is paramount with literally millions of dollars riding on how effectively this organisation’s senior leaders make the decisions they will need to continually make in leading the organisation’s transformation.

In preparing for our recent workshop with the organisation’s senior leaders we offered the following pre-framing information:

  1. As leaders we are often called upon to make decisions within ambiguous environments, where it is not possible to access all of the information needed to make in fully-informed choice.
  1. In these instances, leaders rely on existing expertise and past experiences to underpin their analysis of the context and conditions that inform a current or pending decision.
  1. As a result decisions are often made based on what a leader think they are observe about a current context, rather than what they are actually observing.
  1. Therefore, decisions can be made based on incorrect assumptions and other ‘faulty data’ which can negatively impact the quality of decisions made.

Utilising this context, we then facilitated an Applied Systems Thinking session using the Integral Framework. In support of the Integral Framework we utilised a simple, yet highly effective iterative decision making model offered by Heifetz, Linsky and Grashow in The Practice of Adaptive Leadership, referred to as the Observe-Interpret-Intervene Cycle.

O-I-I Cycle_BASE

As its name suggests, the Cycle consists of three distinct phases:

  1. Observing of the current dynamics of the system under transformation;
  2. Interpreting of the  system’s current dynamics; and
  3. Intervening in the system to further refine the system’s transformational trajectory towards its optimal future configuration.

In working with the organisation’s senior leaders my colleague, Pete Holliday, and I posed a series of three sequential questions in relation to the ‘current state’ of the organisation’s system-wide IT implementation. The series of three questions aligned to  each of the three phases of the Observe-Interpret-Intervene Cycle, but where considered through the 16 perspectives of the Integral Framework (each of the 16 perspectives in outlined in additional detail in the Applied Systems Thinking blog).

  1. Through your perspective of the system, what are you observing?
  2. Through your perspective, how do you interpret what you are observing?
  3. Given your interpretation, what are the top 2 intervention considerations for your perspective?

The organisation’s senior leaders then synthesised the information generated through each of the 16 perspectives to identify the top four foundational leadership opportunities for them collectively in how they work together to understand, engage with, navigate and capitalise upon the IT system’s implementation.

Following is an extension of our initial considerations for working with our client organisation that further ground and extend upon the practice of Adaptive Leadership though the three steps of the  Observe-Interpret-Intervene Cycle.


1. Observe

‘Data’ about a complex situation (e.g., a system under transformation) comes in many forms, including: factual, emotional, relational, technical, tactical, operational, strategic, systemic, etc. In observing a system under transformation, the Adaptive Leader considers:

  • What ‘data’ is the Adaptive Leader observing about the system that informs the decision to be made?
  • What ‘data’ appears to be missing?
  • What actions does the Adaptive Leader need to undertake to learn what is really going on for the system?

Another important ‘data point’ for understanding what is truly going on in a complex situation is your own ‘felt sense’ or experience about the situation or context.  In this instance, Adaptive Leaders consider themselves to be a data point of the system being transformed and consider:

  • What is the Adaptive Leader’s own ‘felt sense’ about what they are observing as present – and missing – within the system under transformation?

All leaders are all pressured to make fast, efficient decisions. As a consequence leaders habitually interpret what they observe at the same time they are undertaking that observation (this is how we can make fast, efficient decisions). However, for the Adaptive Leader leading within highly ambitious and emergent conditions this can result in that leader’s  observations about situations or issues being based on what they want or expect to observe rather than what is actually present in the situation. Therefore, the Adaptive Leader pays specific attention to:

  • How they might typically consider what they are observing, and how might their ‘typical way’ be influencing what they are able to observe – and will systematically discount in their observations – about the system under transformation?


2. Interpret

Next the Adaptive Leader must  make sense of the ‘data’ they have observed in order to make a robust, well-considered decision about how to intervene in the system under transformation. This often involves synthesising that data to identify overarching patterns, hidden issues, assumptions, etc. In interpreting ‘data’ observed, the Adaptive Leader  is determining what the observed/collected data means within the context of the system as a whole. Therefore, the Adaptive Leader considers:

  • How they are  understanding the data they have observed and collected?
  • What are the overarching patterns they are noticing in the data collected?
  • What assumptions are inherent within the data collected, and what assumptions do they feel they need to make in order to make sense of what they are observing?
  • Given what may not be present within the data, what might that mean for what is occurring for the system they are observing?


3. Intervene

The concluding step in the Observe-Interpret-Intervene Cycle of the Adaptive Leader is to  act upon their interpretations and Intervene. For the Adaptive Leader an intervention performs two important functions:

  1. it seeks to improve the issue requiring the leader’s attention; and
  2. It seeks to determine if the leader’s interpretations of the complex context or environment were, in fact, correct.

The Adaptive Leader’s  intervention can take many forms; for example:

  • Asking a new set of questions about an existing issue;
  • Implementing an alterative way of delivering upon existing work objectives;
  • Resourcing existing work processes differently;
  • Engaging a new stakeholder group to address a commonly held work challenge;
  • Ceasing doing an activity/process that you diagnose as adding minimal value; or
  • Another intervention entirely.

In our work with Adaptive Leadership and the Observe-Interpret-Intervene Cycle with multiple client organisations, we have identified three ‘balcony-stance’ for supporting Adaptive Leaders to get on the balcony when practicing the Observe-Interpret-Intervene Cycle:

O-I-I Cycle_META

Each  ‘balcony-stance’ invited the Adaptive leader to both slow and extend their decision-making process even further so as to gain an even deeper appreciation of the system under transformation.


  • The key output from completing the Observation and Interpretation phase of the Cycle is significant amounts of data laden with meaning. Consequently, adopt the Diagnosis ‘balcony stance’ supports the Adaptive Leader to see the signal in the noise.
  • The Diagnosis ‘balcony view’ invites the Adaptive Leader to move beyond observation (what they are seeing in the system) and interpretation (how they are making sense of what they are seeing in the system) to adopt  a meta-stance in making an accurate and robust diagnosis of the real and most critically important issues informing the complexity of content or context under observation present within the system under transformation
  • Adopting a diagnostic stance invites the Adaptive Leader to assess what is “really going on” and decide “what’s most important” resulting in them discerning the song beneath the words leading to make a better decision and, ultimately, the development of a better strategy for positively impacting the system’s transformational performance.



  • The critical output from completing the Interpretation and Intervention phase of the Cycle is for the Adaptive Leader to decide upon an optimal course of action for positively impacting the system’s transformational performance.
  • The Strategise ‘balcony view’ supports and enables that decision through the development of a robust plan or strategy for addressing the specific aspects of the Adaptive Leader’s diagnosis.
  • The development and deployment of a robust strategy designed to positively impact the system’s transformational performance is two-fold:
    1. to either validate or discount the Adaptive Leader’s initial diagnosis of the issue; and
    2. to positively impact (to ‘fine-tune’) the system’s transformational performance.



  • Note: the Observe-Interpret-Intervene Cycle is iterative – rarely do leaders identify the ideal solution for addressing a complex issue first time.
  • The critical output from completing the Intervention and (Re)Observation phase of the Cycle is for the Adaptive Leader to learn how they performed in seeking to positively impact the system’s transformational performance.
  • The Review ‘balcony view’ supports the Adaptive Leader to evaluate the performance of their diagnosis and resulting intervention into the system under transformation.
  • The review also provides further data (an observation) about the new current state of the system under transformation, which informs what subsequent intervention may be required.

Each of these three ‘on the balcony’ stances offers the Adaptive Leader additional opportunities to sense into and dynamically steer the system under transformation towards its optimal transformational performance. Each ‘balcony stance’ also provided the Adaptive Leader the opportunity to they ‘give the work back’ to those who are actually doing the work of transforming the system. And, most importantly, each stance enables the Adaptive Leader to develop and test a working hypothesis on how they might best mobilise they people they lead  to tackle tough challenges and thrive.