It is inevitable that in our fast-paced, global, interlinking economy, we face constant challenges in the way that we do business. We face changes in conditions, attitudes and influences and a shift in pressure and expectations clients put upon us, whilst at the same time trying to manage and balance the needs of our shareholders and employees.
But how do we best rise to these modern challenges? Well, by adapting and responding to working in a modern environment. A modern “VUCA” environment. VUCA you ask? Yes, VUCA.
A term first popularised by the US military in the 1990s, VUCA has steadily made its way into our modern business vocabulary over the last decade. It stands for:
V – Volatility
U – Uncertainty
C – Complexity
A – Ambiguity
For the next three months I will explain the definitions of VUCA.
Its usage applies principally to ideas of strategic leadership and how understanding the VUCA environment can have a positive impact on the business decisions we make. From decision making and forward planning to risk management and problem solving, no matter the size or nature of a business, we are all working in a VUCA environment.
Let’s delve a little deeper and look at what we mean by V, U, C and A.
This Month: Uncertainty
Volatility leads to uncertainty and as a species we’re not keen on that. We like certainty.
Just the recent political events both at home and abroad have shown that we are unable to predict the future. And even if we believe we know the likely outcome of an election or political decision, we have much less certainty and confidence in those predictions. At the same time we begin to feel much more uncertainty about our economic future and its effect on our businesses.
If the events of the past 12 or so months weren’t enough to send our financial markets into cardiac arrest, we can now look forward to months and years of playground-style squabbles as the UK political parties scrutinise (argue) their way through the process of leaving Europe. Now we really are talking uncertainty: Will we have a “hard” or “soft” Brexit? Will Scotland have another “Yes/No” referendum? Where will the Northern Irish border be? Will there be free trade? What happens to EU migrants? Perhaps we should just ask Mexico to build us a wall around our coastline and be done with it.
But in all seriousness, we face a massive period of uncertainty which hugely impacts what business decisions we can make and when we can make them. It’s not surprising that so many CEOs admit to their business continuity plans being vastly out of date.