VUCA. This term is frequently thrown around in boardrooms and strategy sessions across the country. Coined by the US Army War College in the late 1990s, VUCA is an acronym that was originally used to describe the combat conditions facing soldiers in Afghanistan and Iraq. It stands for volatile, uncertain, complex, and ambiguous.
While the term initially called for vigilance in military environments, it is commonly used today in professional settings to convey a sense of hand-wringing, shoulder-shrugging anxiety. Civilian boards, executives, and consultants tend to use the term VUCA when they feel as though they’re being held hostage by conditions over which they have zero control. Over the years, I’ve heard leaders offer it as an excuse for not setting sights higher, not stretching farther, not working harder to retain or regain market share, and not striving for excellence.
Unfortunately, VUCA has strayed far from its military origins and become a civilian excuse for settling for less. This “Eeyore oh-bother” victim mentality has a negative impact on the decision-making process—especially when it comes to annual business plans and strategy. So, what is the cure for the adverse effects of VUCA thinking? Perspective. With a proper fact-based perspective, leaders can exhibit more control than they realize over the four VUCA realities.
Volatility: This is the toughest aspect to control and predict. When a leader has a clear, objective understanding of internal and external conditions, it is easier to recognize impending volatility and prepare proactive plans to respond accordingly.
Uncertainty: Whether you’re running a credit union or a billion-dollar company on Wall Street, uncertainty is a reality of business. However, far too many leaders make the mistake of assuming uncertainty is inevitable rather than taking the time to develop a perspective that can provide much-needed clarity.
Complexity: The best way to approach complexity is to view it as an opportunity to simplify. Many fast talkers try to impress others by using big words and making mountains out of molehills. But even the most complex situations and concepts can be broken down into smaller pieces, clarified for all to understand, and successfully addressed.
Ambiguity: This is the one “reality” that doesn’t belong in the acronym at all. Ambiguity is nothing more than a man-made condition that exists within the other three. If you’re willing to do the work required to clarify an issue or situation, nothing ambiguous needs to remain so. So, since you’re a rational leader who approaches the decision-making process with a proper perspective, let’s just remove the ambiguity and shorten the acronym to VUC.
Perspective enables higher productivity, better decision making, effective problem solving, and more relevant action steps. Together, these qualities lead to higher levels of performance for both the individual and the organization. When you lead with a proper perspective, your organization can thrill members, lower cost, and increase loan and membership growth. Along the way, you can also create deeper engagement with your team, building trust between leadership and those who deliver value directly to your members.
VUC may be here to stay, but a proper perspective and proactive planning will allow you and your organization to successfully navigate the uncertain reality. Rather than accepting ambiguity as a new norm, develop a fundamental intolerance for it. When it arises in your office or your boardroom, end it quickly. When you can create clarity around your purpose, priorities, and processes, you will find that it’s easier to resolve perceived problems and create a win/win scenario for your team and your members.