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Managing in a VUCA environment

Understanding the VUCA environment means learning how to expect the unexpected and how to navigate unknown territory. The concept of a VUCA world came into prominence after it was used by the United States Army War College to describe the state of the world following the Cold War, and gained further prominence after the 9/11 attacks in 2001.

Since then, it has become an important crisis management concept in the business world, especially recently, as the COVID-19 pandemic further reinforced the need for businesses to survive under volatile, uncertain, complex and ambiguous conditions.

So, what is the VUCA model, and why is it helping businesses navigate our rapidly evolving environment? Let’s explore the VUCA world.

VUCA meaning

VUCA is an acronym that stands for Volatility, Uncertainty, Complexity, and Ambiguity.

These four terms are used by organisations to frame their approach to unexpected challenges. You might not be able to anticipate the exact nature of the challenges that lie ahead, but the VUCA model is used to help you stay prepared should a disaster of any kind strike.

Understanding VUCA through the pandemic

The global COVID-19 pandemic is a clear example of the type of challenge VUCA is designed to help businesses overcome:

Volatility

The volatility of the pandemic meant everything changed rapidly, with no clear indication of how long it would last. Everything from the economy to the way we communicate saw drastic transformation almost overnight. Anticipating an environment where everything can change in a second means having systems in place that help you bounce back in the face of sudden turmoil.

Uncertainty

Uncertainty has been an enormous concern throughout the pandemic. At the early stages, when there was so little concrete information available, businesses were forced to act quickly and respond to sudden changes as more information unfolded. There’s still plenty of uncertainty about the overall effects of the pandemic. It was hard to anticipate the social impact that the pandemic would have on mental health, job security, and morale, and many were left overcome with feelings of uncertainty.

Complexity

A great deal of complexity surrounds the pandemic, with almost every part of everyday life hugely impacted by it. With so much information being spread, including misinformation, it’s certainly a complex task to balance the various perspectives and approaches towards the issue. There are so many angles to consider, from health and economy to culture and society, and when every facet of life is impacted, it helps to be prepared for complexity.

Ambiguity

Ambiguity has played a significant role in the effects of the pandemic. Whether it was ambiguity about the importance of masks, lockdowns, timelines, and even vaccines – we entered the pandemic without much precedent as to how to approach it, as communities, businesses, and individuals. That meant having to keep going without fully understanding the true impact of the pandemic, and balancing the varying effects it had on individuals within a business with the effects it had on the business as a whole. 

The businesses who have thrived and survived amid the pandemic are those who have exhibited strong VUCA leadership.

The VUCA world is a checklist

VUCA is not so much a tool as a checklist you can use to help ensure you’re prepared for any problem that might arise. It doesn’t need to be a problem as large and universal as a pandemic. In business, volatility can simply mean a sudden loss of an important vendor, uncertainty might be a lack of clarity about a new system, complexity might be having to deal with various new regulations as you expand your business internationally, and ambiguity could be taking a risk by exploring a new market.

You can use VUCA as a checklist to help you predict and understand the potential effects of any given action or event.

Exhibiting VUCA leadership

Through the VUCA model, you can devise systems and strategies that might not offer specific, concrete solutions, but still ensure you’re as prepared as you can be for whatever tomorrow may bring.

It’s about understanding the volatility, uncertainty, complexity, and ambiguity that may come with anything you do as a business or anything that can impact your business. Consider VUCA every time you partner with a new supplier, every time you start using a new tool, every time you propose a new process – any and every aspect of your business should be filtered through the lens of the VUCA world.

It goes beyond having a business continuity plan and crisis management strategies in place.

As a VUCA leader, you should always ensure you build resilience and you have the resources to recover quickly in an unstable environment. Understand your goals and how they can shift, and have systems and processes that encourage and facilitate innovation and improvisation. Ensure every part of your business is operating as efficiently as possible, and always have more than just a ‘Plan B.’ Forecasting is important – but more important is having the right mindset and accepting that anything can happen.

You’ll be able to maintain positive morale in a VUCA environment if you approach business with objectivity and empathy, if you exhibit confidence and integrity, and if you’re realistic about the expectations and targets you put forth. Engage with everybody in your organisation with care, understanding, and an open mind. Managing in a VUCA world means leading by example and showing bravery and empathy in equal measure, no matter what challenges lie ahead.

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