VUCA – It’s A Thing!Feb 06, 2023
How VUCA Changed My World
It was in chapter 3, somewhere around page 40 in Mastering Leadership (Anderson and Adams), that this little acronym jumped off the page and changed how I saw the world. VUCA. Four simple letters. Volatility, Uncertainty, Complexity, and Ambiguity. Four words that are fairly common in the English language. These four words put together, however, reveal an entirely new way to describe an environment that requires continually evolving methods to navigate and requires collective approaches to leadership to survive. No one person, or historic solution, is sufficient to answer a challenge in a VUCA environment.
“The timeless challenge of leadership is to bring together a group of diverse individuals and create an environment where they will work together effectively toward common, shared goals. This is best accomplished through the notion of collective leadership, which brings an organization together as one.”
-James Quigley, CEO Emeritus, Deloitte US
VUCA debuted at the US Army War College in 1988 but gained popularity following the end of the Cold War with a global understanding that the geopolitical world no longer fit into the box of two dominant world superpowers. Changes that were impacting the world started occurring more quickly and with increased uncertainty. So, what is VUCA?
Volatility is the quality of being subject to frequent, rapid and significant change. It alludes to a certain instability, that maintains unpredictable timing and duration of change. In high-volatility environments, change occurs frequently and quickly, and its impact may be far-reaching. The more volatile a situation is, the faster and more frequent things change.
Uncertainty refers to a lack of predictability in future outcomes based on an absence of pertinent information. This occurs when important information does not exist or is not known because the individual or organization requiring it does not have access to it or can’t understand it due to a lack of requisite knowledge. The more uncertain a situation is, the harder it is to rely on historic cause and effect relationships or to predict future outcomes.
Complexity refers to the number, variety and relationship of the factors that need to be considered for a given situation. In a highly complex environment, there are a multiplicity of factors to consider which may be intricately interconnected and differ greatly. This renders the environment difficult to analyze and understand. “Complexity” is not to be confused with “complicated”. While a process or situation may be complicated, known and able to be clearly evaluated, a situation that is marked by complexity generally has elements that remain unknown or cannot be fully identified even after the situation has passed.
Ambiguity refers to an absence of clarity or an inability to interpret a situation. Ambiguity can open the door for more than one interpretation to be equally plausible, and equally inaccurate. A situation may be difficult to interpret if the available information is suboptimal – incomplete, inaccurate and/or contradicting. Highly ambiguous environments lack useful precedents and meaningful causal relationships. They are vague, blurred, and generally leave leaders open to an array of potential avenues which may prove to be fruitful or disastrous depending on how the situation further crystallizes over time. The more ambiguous a situation is, the harder it is to interpret.
Why Is VUCA Important?
When a problem arises, our past experiences are the most reliable resource to draw from for a solution. However, what do we do when those prior solutions are no longer effective? That is a good time to run your situation through the VUCA filter presented above. If you notice that your situation matches the description of several items above, it can be very helpful to recognize that you are likely in a VUCA environment and the responses, or approaches, of the past will not help you this time around. There is a clear difference between a complicated situation where you can discern the cause and apply the appropriate response, and a complex situation that can only be somewhat understood in retrospect. Peter Drucker famously said, “The greatest danger in times of turbulence is not the turbulence. It is to act with yesterday’s logic.”
VUCA can exist in almost any environment where people are engaged in a dynamic system. VUCA can exist in a company. A city. A nation. And now, in a political environment like we are currently experiencing, a global pandemic with few clear remedies, and technological innovations that are accelerating at exponential rates…we have fully entered a Global VUCA reality teetering out of control. And it’s not going to slow down. That is why understanding VUCA matters.
Jack Welch wisely observed, “If the rate of change outside exceeds the rate of change inside, the end is in sight…” This internal need to change is largely found in two places, the personal development of a senior leader, and the collective leadership of the leadership team around her. If the senior leader and her leadership team aren’t growing at the same rate or faster than the complexity around them, the wheels are going to come off. Maybe not today, but they will come off eventually.
How Do You Address A VUCA Situation?
A quick Google search will give you a number of ways to assess and address a VUCA environment. The following is a comprehensive approach to understand what you’re facing and how to thrive in the chaos.
The first thing you need is a clear Vision. Almost everyone’s approach to thriving in a VUCA environment begins with a clear organizational vision. If you aren’t locked in on where your organization is going, you will continually react to every new threat and change…seeking to mitigate the pain you feel and the fear you perceive. Clear vision provides guidance on when and how to engage based on what keeps you moving forward and aligned with your mission. A clear vision in a VUCA environment helps you make decisions with purpose as their foundation.
In a true VUCA environment, uncertainty and ambiguity are hallmarks of the climate. Clarity is the second essential item. Every leader and leadership team must take the time to slow down and assess the situation they are navigating or problem they are facing, to ensure they are dealing with as many facts, known data, and available perspectives regarding the situation as possible. Rarely, if ever, are the observations and experiences on the surface, the true reality of the situation. Is there a root cause of the situation and has it been uncovered? Has the leadership team considered all of the assets and collective leadership around them? There is no need to add willful ignorance to a VUCA environment. In the pursuit of clarity, seeing the data as a whole system, and not disparate parts, helps to better evaluate how complex the situation is.
Systems Awareness is the third essential element. Everything present in a system will impact the entire system. Though it may not always be immediately clear how, when something changes in a system, it changes the entire system. To navigate a VUCA environment, it is essential to consider all the ways a change has affected the entire system and not just the immediately obvious effect. If you react to a change as though it stands alone, you will multiply the number of issues that need to be addressed. Metaphorically, if you don’t deal with the monster, you will create a three-headed monster in its place. While it is imperative to find and relentlessly deal with the root cause of an issue, in highly complex situations there may not be a single root cause. In highly complex situations, adaptive leadership is essential.
The final element to leverage in navigating a VUCA environment is Adaptive Leadership. Peter Senge, Hal Hamilton, and John Kania, in their article, The Dawn of System Leadership, so eloquently state we are, “firmly anchored to the myth of the heroic individual leader.” Challenges in a VUCA environment require an adaptive approach, not a technical one. According to Ronald Heifetz, adaptive leadership is the activity of mobilizing people to tackle tough challenges and thrive. That activity relies on diversity. Adaptive leadership builds a culture that values diverse views and relies less on the “genius” of the few at the top. These challenges must be navigated by the collective leadership of many, not the sequestered few.
Adaptive challenges are not clearly identifiable at the outset and have no known solution. Technical problems are more easily identified and have known solutions.
Collective Leadership happens when a group of people work together toward a shared vision using their unique talents and skills to contribute to the success.
How Do You Continue to Move Forward?
To respond in a new way to any situation doesn’t come naturally, but nothing about responding to VUCA comes naturally either. Once you have identified that you are in a VUCA situation, here are three steps to cycle through as you seek to navigate it.
Take a moment to pause and reflect on all that you know about the situation. This is not a time to simply push forward and take the bull by the horns. Thoroughly evaluate the situation and document what you see and what you believe is true. To clearly understand the perspective you have and the assumptions you are making, you must slow down and reflect on how you currently view the situation. Once you have clarity on your perspective, it is helpful to assess what questions you aren’t asking or how your perspective might be wrong. The ability to entertain perspectives beyond your own is not only a monumental step in anyone’s personal developmental process, but it is essential to navigating a VUCA environment.
Holding your perspective with an open hand, it’s essential that you entertain the perspective of others. Once you understand the perspective you hold, you can begin to solicit the perspective of others. Every VUCA situation is by definition complex. Now is not the time to simplify the complexity, but to embrace the complexity and handle it as it is…complex! Consider the elements affecting the system you’re in, don’t try to separate them out as though they won’t be impacting the system anymore because you excluded it. Consider the situation in its complexity…all together and interconnected.
Because you can’t just solve a VUCA situation or “cure” a VUCA culture, don’t try. Be courageous and launch out anyway! It may feel risky to set off together with your team into uncharted and uncertain waters, full of ambiguity, but together is the only way to move forward.
At this point it is far more effective to trust those around you to have a greater assessment and contribution to addressing the situation than you have alone. Your own interpretation of the facts isn’t fact. Trust the team you are working with to create a better response than you can alone. After collectively evaluating the situation and assessing the real issue that needs to be addressed, collectively create your next steps. Remember, you’re not looking for the silver bullet, you’re looking to continue to move forward toward your vision.
Now that you have a broader, collective understanding of the situation, design or redesign your approach accordingly and again have the courage to move forward, together. Addressing a VUCA situation will require an iterative process. After setting a course and moving forward, a continual evaluation is required to revise or reject the course that you’ve set. Volatility and complexity will cause the inputs and affects of the system to continually change. Whatever worked yesterday, will not likely work tomorrow. Collectively reflecting, risking, and revising your approach will be a game changer.
We now live in a VUCA world, and it is full of volatility, uncertainty, complexity, and ambiguity. However, that doesn’t mean that every situation that arises in life is necessarily a VUCA situation. Work through non-VUCA situations using all your prior experiences, tools, and learnings. In Simon Sinek’s book, The Infinite Game, he talks about an infinite game being one without a clear winner or loser and does not possess a defined beginning or end. The players in an infinite game come and go, the rules are dynamic; there is only ahead and behind. Business, relationships, nation building, and life, are all arenas we participate in that have a desired outcome of continued engagement. If you are winning that’s a plus, but that doesn’t mean the game is over. The goal in business isn’t to simply win, it’s to continue to stay in business and to continue to move forward toward your vision.
VUCA is real. To know what it is and to embrace the reality that VUCA can be addressed might just help you to thrive and develop a new competitive advantage in the midst of a complex and chaotic world.