That VUCA Feeling… (Part 1: How To Prime Your Business For Resilience)

You may already be familiar with the term, but even if not, it’s likely you’ve encountered it.

I came across VUCA only recently and immediately it struck a chord. It represents how we understand and cope with the environment around us and in turn, how our behaviour and business activities impact on that environment and our clients.

So what is VUCA?

For an acronym, VUCA has a colourful past. The U.S. military conceptualised it after the Cold War, but it was also used to navigate the chaos of the financial crash in 2008.

VUCA describes situations that are Volatile, Uncertain, Complex and Ambiguous. Now if that doesn’t reflect the space in which we all operate in the present day, then I don’t know what does!!

As you’d expect, a VUCA environment is a less than helpful one to work in because it affects our stability, confidence, planning and decision making. That said, while VUCA is generally used to describe external factors or influences over which we may have limited control, it doesn’t mean that we should just roll over.

Strategies for success in a VUCA environment

1. Remove – Avoid – Reduce

  • First of all, are you able to remove or avoid the VUCA elements? Will a change in suppliers, or subtle alterations to your product or niche, allow you to sidestep the VUCA dynamics?
  • Or can you at least dial down their influence? – Perhaps you can achieve greater stability by working with a range of delivery partners rather than being reliant on just one, or in uncertain times, gain more foresight by fixing-in longer-term supply deals for your key components.

2. Flex

  • While it sounds slightly counterintuitive, there may be occasions when you choose to work in a VUCA environment.
  • Like the Starship Enterprise deliberately entering a hazardous asteroid belt to escape technically superior pursuers, maybe you can create an advantage over bigger rivals by better navigating your VUCA space?
  • To do this and succeed in the VUCA zone, you will need to adapt, with flex and resilience being your competitive advantage…

 
VUCA Resilience
“You can’t stop the waves, but you can learn to surf” (Mindfulness and meditation guru Jon Kabat-Zinn)

Here’s how you can manage the VUCA dynamics and turn the tide on the effects it has on your business…

  1. Vanquish Volatility: Achieve stability and consistency. In an environment prone to unpredictable change or disruption, you need defined processes. You want defined (ideally automated) procedures that are part of a system, with triggers to activate them, and follow-on actions and consequences. Remember, action is key, without it, procedures are redundant. With systems and controls in place, you will be able to ride the waves of volatility and be in a position to devote more time to grow and improve the business.
  2. Uproot Uncertainty: When the external environment is unpredictable, it’s vital to understand how your business works internally and how a change in one factor, will impact on another. This requires design (as in 1. above) and also testing. You need to be confident, that when you pull a lever, you know what will happen. For instance, do you know how much extra money you need to invest in marketing in one month, to double your leads in the next, or how long it takes to recruit and on-board a new designer to be fully contributing? This appreciation of cause and effect will not only allow you to react and adapt in a VUCA storm, but it will also boost the confidence that staff and stakeholders have in your business and your own ability to lead.
  3. Conquer Complexity: Create simplicity. Every business has moving parts, but too many can be chaotic. This is especially true when it has been built by exception – adding in a new process each time a new situation arises. Although few owner-run businesses set out with this intention, many still try to accommodate every eventuality all the same.  If this sounds familiar, take a step back. Consider which processes (internal or customer-facing) can be re-used and multi-purposed, instead of designing everything to work for one application. This will help simplify daily operations while also ensuring your business is replicable and scalable.
  4. Attack Ambiguity: Clarify and gain understanding and agreement. When details are sketchy, or there is a general lack of understanding between people or departments, then confusion and ambiguity will arise. So, communicate, communicate, communicate! When your team knows what they need to do and why they’re doing it, they are empowered, supportive and more willing to invest in you.

What VUCA dynamics do you face with your business? Do you avoid, mitigate, or ride the waves?

Next Up: VUCA Part 2 – As well as looking at how our own businesses respond to VUCA, we also need to consider how we can reduce the VUCA ripples we create for our clients.

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