“If you want to teach people a new way of thinking, don’t bother trying to teach them. Instead, give them a tool, the use of which will lead to new ways of thinking.”
Richard Buckminster Fuller
VUCA IS LIKE KRYPTONITE
And that folks is the ultimate paradox for modern leaders: you can’t predict the future, but you must make sense of it in order to thrive. In today’s world, you must be quick and nimble too.
To be fair, making sense of change has always been challenging. Change is nothing new. But increasing instability and a pace of change that seems to be accelerating at warp speed is creating an environment best described in military terms: VUCA.
VUCA for many established and successful leaders is what Kryptonite is to Superman—it makes even the most powerful being vulnerable. Coined in the early 1990s, the military-derived acronym stands for Volatility, Uncertainty, Complexity, and Ambiguity—terms that seem to fit our modern world perfectly. This new VUCA environment will require many business owners and executives to change their approach toward leadership and for HR professionals to revamp leadership training and development.
ARE YOU THE NEXT SEARS, KODAK, OR BLOCKBUSTER?
Today, too many companies and their managers are stuck in a rut. They continue to repeat and tweak the past in order to remain competitive. To paraphrase Albert Einstein, “doing the same thing over and over and expecting different results is the definition of insanity.”
Let me paint an absolutely crystal clear picture of what I just said. If you or your management team are “working on it” or “are planning to discuss it at our next strategic retreat” or my favorite: “our industry is different,” then your business model and the business itself is very likely an accident just waiting to happen. “Waiting for things to play out” or “keeping an eye on our competition” is not dealing with a VUCA world.
Your competitor today is not likely the most significant threat tomorrow. Don’t believe me? Just ask any watch manufacturer if they thought a smartphone could ever replace the wristwatch? Or the Internet could decimate the print industry? Or Amazon could decimate Sear and Netflix bankrupt Blockbuster? Or Kodak and Polaroid could be bankrupted by digital cameras (or even the smartphone)? The biggest threats today aren’t coming from your direct competitor but another industry or a product that hasn’t even been invented yet.
PROBLEMS VS DILEMMAS
But I digress. Back to VUCA.
We are moving from a world of problems, which demand speed, analysis, and elimination of uncertainty to a world of continuous dilemmas, which demand patience, sense-making, and an engagement with uncertainty. Anchoring strategy in the past does not ensure sustainability and in fact, it likely will hasten a company’s demise.
Dilemmas differ from problems in significant ways. Specifically, many problems can be solved by a single expert or a small specialized team. When it comes to solving problems, experience, and education matter. In fact, experience and education could be enough to qualify you as the go-to person, the subject matter expert.
Dilemmas, on other hand, span many disciplines. Volatility, ambiguity, and complexity create environments that are in a constant state of flux and frustrate attempts by traditional problem solvers to “get their head around it” to craft a definitive solution. In fact, traditional problem solving and leadership approaches stymie, and even paralyze, many leaders who demand certainty in an uncertain world. Dilemmas require a different orientation, decision process, and set of skills.
VUCA LEADERSHIP DEVELOPMENT
This new VUCA environment will require every organization to change its focus and methods of leadership development. VUCA, as Thomas Friedman (The World Is Flat) notes, is taxing even the ablest of leaders who may find their skills growing obsolete as quickly as their organizations change in this volatile, unpredictable landscape. Leadership agility and adaptability are now required skills if organizations are to succeed in this VUCA world.
Boston Consulting Group recently concluded that organizations today must shift their business models—and their leadership skills—to become “adaptive firms.” Another report by the Center for Creative Leadership also notes that today’s VUCA business environment requires leaders to possess more complex and adaptive thinking abilities. These skills and abilities are a far cry from the more function-specific skills and abilities leaders needed in the past to succeed. HR and talent management professionals must refocus their leadership development efforts to hone these more strategic, complex critical-thinking skills.
More traditional leadership development methods are often at odds with the leadership demands in a VUCA world, where knowledge across the organization and the speed of learning outpace the slower and more job-specific learning approaches. As a result, leaders are not developing fast enough or in the right ways to keep up with the “new normal” for business.
Bob Johansen, distinguished fellow at the Institute for the Future and the author of Leaders Make the Future: Ten New Leadership Skills for an Uncertain World, proposes that the best VUCA leaders are characterized by vision, understanding, clarity, and agility—the “flipside” of the VUCA model.
HIRE VUCA READY LEADERS
To hire VUCA-competent leaders, companies need to assess agility and complex thinking skills during the selection process. An essential approach to evoking examples of past agility and thinking skills on the job comes from a structured interview format based on the competencies and abilities that directly impact agility and decision making.
For example, here are two sample interview questions you might ask a candidate:
- “Give an example of when your ability to be decisive was put to the test—when you had to convey a sense of urgency in decision making. What was the situation, what factors did you consider when making the decision, and what was the outcome?”
- “How do you determine when you need to gather more information before making a decision versus making a decision based on the information you have at hand? Give a recent example of when you made a quick decision based on the information you had immediately available and it worked out … and a situation where you opted to collect more information but missed an opportunity.”
IS THERE AN ELEPHANT IN YOUR C-SUITE?
There is a world market for about five computers.
Tomas Watson, founder and chairman of IBM, 1943
The telephone is an amazing innovation, but who will ever use it?
Rutherford B. Hayes, U.S. President, 1875
The development [of the automobile] has been so remarkable that we do not expect any further improvements in the future.
German car manufacturer, 1914
The continuing shortages of housing inventory are driving the price gains. There is no evidence of bubbles popping.
David Lereah, PhD—president Reecon Advisors to Wall Street, 2007
VUCA LEADERSHIP ASSESSMENTS
Leadership assessments also play a critical role in selecting and developing VUCA-ready leaders. Leadership assessment tests not only confirm that a candidate has the innate talent to do what he says he has done (and that he just wasn’t in the right place at the right time) but do what is needed when complexity and ambiguity prevails.
Just as important, the lack of innate talent does not mean an individual can’t develop the skill. Specific to the requisite qualities that can be identified by an assessment, adaptability and agility are directly affected by one’s frustration tolerance, self-control, openness to new experiences, risk aversion, and awareness. Complex thinking skills require a high need to probe, systemic thinking to assess new information, and high general mental abilities to process a lot of new information quickly.
ARE YOU READY FOR VUCA?
So given the new VUCA environment and the requisite skills to deliver results, do you know who your VUCA-ready managers and executives are? Do you even have such leaders on your payroll and how would you know? Do you have the right executives and managers to keep you “ahead of the curve” in the VUCA world of business?
You CAN win in the VUCA world of business. Compete in the present. Sense the future. Hire and develop VUCA-ready leaders.
Originally published in Business2Business Online in Oct 2013 and update May 2020.