How to deal with a VUCA environment?

By Marcelo Muñoz

09 January, 2020 | 23:01hrs

We are increasingly aware that we are facing an unstoppable time of changes in every sphere of life. Among these, the business sector is perhaps one of the most challenging because it demands a lot of understanding, preparation, adaptation, and ability to manage strategies allowing organizations to position themselves in a fully competitive world.

Any change implies new strategies and, in turn, these determine whether an organization becomes stronger or not. In fact, throughout history, it is possible to recall several challenging moments of transformation that have put the role of leadership to the test during these processes. VUCA environments were born then, a concept that became relevant after the Cold War and which, since then, has been used as a reference in the business sphere.

After the Cold War, other historical events were also identified as VUCA environments, as it happened after the attack on the U.S. Twin Towers in 2001 and during the global economic crisis by 2008 – 2009. Therefore, when it comes to VUCA environments –the English acronym for volatility, uncertainty, complexity, and ambiguity–, it means circumstances representing great challenges for an entire community.

Dennis Reimer, Army Chief of Staff of the United States in 1990, has summarized 5 strategies that were applied at the time and which are completely valid in the business field:

  • Shaping the culture around mission and values of the organization
  • Leveraging technology to speed up the adaptation process
  • Aligning organizational structures
  • Establishing a learning organization
  • Working towards leaders development

As in the 1990s, today’s business leaders must understand their VUCA environments so that they can respond to them effectively. The success of companies will depend on this management, where each of those involved also plays a leading role.

The new technologies have resulted in several transformations regarding the way work was understood within and outside the organizations. Understanding this means being prepared for volatility, uncertainty, complexity, and ambiguity scenarios, which are constants in these times of digital transformation.

This requires focusing on actions and strategies aimed at changing old paradigms and developing new habits and patterns, which will allow developing strategies adapted to the era we are living in.

These challenges are not only affecting the leaders but the entire organization structure, which is required to work together towards the same goal. Increasing productivity, providing excellent products and services, reaching customers, achieving customer loyalty, and understanding user demands are part of these challenges.

However, nowadays, the success of companies mainly depends on managing key aspects such as adaptation to changes, as well as the abilities of leaders and their staff to face imminent VUCA environments.

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