The phrase closed loop means that the system has a sense of where it is, and therefore, can be told to go to a specific position. Closed loop systems are common within both motors and servos. Motors that have encoders can utilize the encoder reading to get a sense of location (whether relative or absolute) and position themselves accordingly. Servos typically use an absolute potentiometer for a position sensor and when the servo receives a signal from the servo controller, it is then able to check its current position and move to the position that corresponds to the signal received.