THE VUCA World

Throughout the past decades we find numerous terms in the popular academic literature that refer to an increasing inability to grasp the world and deal with the things happening around us. Examples include uncertainty, turbulence, rapid change, dynamism, disruption, complexity, hyper-competition, high-velocity markets and flux.

For a couple of years, the notion of "VUCA" is gaining popularity as a term to cover the various dimensions of this ‘uncontrollable’ environment. For example, about a "VUCA World" But what does being and leading in a VUCA world really mean?

It stands for Volatile, Uncertain, Complex and Ambiguous

VOLATILITY

We live in a world that’s constantly changing, becoming more unstable each day, where changes big and small are becoming more unpredictable and they’re getting more and more dramatic and happening faster and faster.

As events unfold in completely unexpected ways, it’s becoming impossible to determine cause and effect.

UNCERTAINTY

It’s becoming more difficult to anticipate events or predict how they’ll unfold; historical forecasts and past experiences are losing their relevance and are rarely applicable as a basis for predicting the shape of things to come.

It’s becoming nearly impossible to plan for investment, development, and growth as it becomes increasingly uncertain where the route is heading.

COMPLEXITY

Our modern world is more complex than ever. What are the reasons? What are the effects? Problems and their solutions are more multi-layered, harder to understand.

The different layers intermingle, making it impossible to get an overview of how things are related.

Decisions are reduced to a tangled mesh of reaction and counter-reaction – and choosing the single correct path is almost impossible.

AMBIGUITY

"One size fits all” and “best practice” have been relegated to yesterday in today’s world it’s rare for things to be completely clear or precisely determinable. Not everything is black and white – grey is also an option.

The demands on modern organizations and management are more contradictory and paradoxical than ever, challenging our personal value systems to the core.

In a world where the “what” takes a back seat to the “why?” and the “how?”, making decisions requires courage, awareness, and a willingness to make mistakes.

From where VUCA world comes?

VUCA is an acronym used by the American Military.

It was the response of the US Army War College to the collapse of the USSR in the early 1990s. Suddenly, there was no longer the only enemy, resulting in new ways of seeing and reacting and their thought process become blind.

It’s similar applied to the modern business world; working with traditional business models won’t survive your business in the VUCA world. In the VUCA world everybody is empowered to disrupt your business (model). VUCA allowed AirBnB, Uber, … to grow their business and disrupted traditional industries (hotel industry, taxi-industry, …)

Today a company needs to disrupt its business (model) or it will be disrupted (in the near future).

Facts (VUCA Effects)

• 21 Famous Fortune 500 companies bank corrupted
• Only 11% of the fortune 500 company from 1995 still on the list today in 2020
• The Average life span of a 500 company has decreased from 67 years (1920's) to 15 years
• 14 out of 30 top brands are already platform based companies

world is changes faster and faster while reading this, 76000 Hours Listened on spottily, 140000 hours watched on Netflix and 134000 POST in Instagram done.

 Leader

As a Leader, you are responsible for the decisions about the parameters that define how your organization can operate.

The increase in volatility, uncertainty, complexity, and ambiguity means that you and your business must seek new orientations and take a fresh approach to management. Only then can you guarantee positive results in changed circumstances.

The VUCA world challenges you to find your own way. You will need to understand the psycho-logic and develop empathic behavior in short, to be more concerned with humans and their needs. Meaning and purpose take a central role in business activities.

The Solution

New technology comes in and disrupts markets almost overnight. Competitors emerge from unexpected corners. Like UBER, ZOMATO, AMAZON, FACEBOOK, BYJU's

Political and economic situations shift rapidly, exposing organizations to unprecedented levels of risk and vulnerability.

We are indeed operating in a volatile, uncertain, complex, and ambiguous (VUCA) world -

“It’s becoming clear that our comfortable, classic models of leadership don’t work in this constantly changing climate."

Tomorrow’s global leaders have to be skilled in negotiating their way through three key factors: context, complexity, and connectivity. The challenge for organizations is to make sure they are equipping future leaders with these “three Cs,” rather than simply developing them in the leadership mold of the past.

 What does VUCA mean for your LEADERSHIP and your strategies?

VOLATILITY = VISION

UNCERTAINTY = UNDERSTANDING

COMPLEXITY = CLARITY

AMBIGUITY = ADAPTABILITY

VOLATILITY = VISION

Paint a picture of the future you want. The big picture and make decisions based as much on it.

VISION is developing a shared purpose, the ability to build teams where employees have a shared purpose and vision is key. Leaders need to help their people understand the bigger picture and how they personally fit into it.

Always retain a clear vision against which judgments can be made, with agility to flex and respond appropriately to rapidly unfolding situations.

Provide clear direction and consistent messaging against a backdrop of continually shifting priorities, supported with the use of new virtual modes of communication where necessary.

UNCERTAINTY = UNDERSTANDING

Understand interconnections; make them transparent.

Reflect on the context.

Start from the result and work backwards. Derive your action from Future

Convert anxiety and resistance into productive energy.

Be curious. Uncertain times bring opportunities for bold moves. Seize the chance to innovate.

Self-awareness - Leaders need an understanding of their own strengths and areas for development and the impact their communication and working style has on others. The ability to be authentic and show your true self at work is key to building trust.

Confidence to lead through uncertainty - the ability to assess acceptable levels of risk and make decisions based on incomplete or even conflicting information is key. Managers also need the ability to learn from mistakes and to allow others to do the same.

Encourage networks rather than hierarchies - as we reach new levels of interconnection and inter-dependency collaboration yields more than competition.

Leverage diversity – as our networks of stakeholders increase in complexity and size, be sure to draw on the multiple points of view and experience they offer. Doing so will help you expect the unexpected.

Anticipate risks but don’t invest too much time in long-term strategic plans. Don’t automatically rely on past solutions and instead place increased value on new, temporary solutions, in response to such an unpredictable climate.

 COMPLEXITY = CLARITY

Focus on what counts and what it's really about. Apply energy and force exactly where they will be most effective.

Leading through collaboration and influence - In today’s complex world, success often depends on working with people over whom you have no official authority. Tomorrow’s leaders need high-level influencing skills and the ability to collaborate with a wide range of stakeholders.

Employee Engagement - Never lose focus on employee engagement. Provide strategic direction, whilst allowing people the freedom they need to innovate new processes, products and services

Capitalize on complexity - If your talent management strategy is working, then you should be confident that you have the right people in the right place. This will enable you to rapidly break down any challenge into bite size pieces and trust in the specialist expertise and judgment of those around you.

Get used to being uncomfortable - Resist the temptation to cling on to outdated, inadequate processes and behaviors. Take leaps of faith and enjoy the adventure.

 AMBIGUITY = ADAPTABILITY/AGILITY

Promote a consistent culture for making decisions and accounting for mistakes. Interact transparently with objections.

Learning agility - Tomorrow’s leaders need to be willing to stretch themselves out of their comfort zone and be open-minded enough to rapidly embrace new concepts.

Building resilience - Surviving and thriving in a VUCA world also calls for a high level of resilience. Developing this depends on a combination of physiological, psychological, and organizational factors. For example, leaders need to pay attention to their physical health, develop confidence in their own abilities, and willingly seek the support of colleagues and friends.

If you feel your resilience as a leader could be improved, here are just a few questions to ask yourself:

– Have you have had the right amount of sleep for at least 10 out of the last 14 nights?

– Have you received and acted on developmental feedback at work during the last two weeks?

– Have you discussed a work-related stressor with at least one family member and one work colleague in the last two weeks?

– Have you exercised for at least 30 minutes, three or more times per week in the last two weeks?

Of course, there are a huge number of factors to take into consideration. But looking at how you shape up against these questions will help you to start thinking about what you may need to do differently to improve your resilience in a VUCA world.