V U C A

Volatility, Uncertainty,
Complexity and
Ambiguity
Survival Rate for Globalised Corporates

Age in Percentage Perish Percentage surviving

Years
5 62 38
10 79 21
15 86 14
20 90 10
25 93 7
50 98 2
75 99 1
100 99.50 0.50
• The deeper meaning of each element of VUCA serves to
enhance the strategic significance of VUCA foresight and
insight as well as the behaviour of groups and individuals
in organizations. It discusses systemic failures and
behavioural failures, which are characteristic of
organisational failure.
• V = Volatility. The nature and dynamics of change, and
the nature and speed of change forces and change
catalysts.
• U = Uncertainty. The lack of predictability, the prospects
for surprise, and the sense of awareness and
understanding of issues and events.
• C = Complexity. The multiplex of forces, the confounding
of issues, no cause-and-effect chain and confusion that
surrounds organization.
• A = Ambiguity. The haziness of reality, the potential for
misreads, and the mixed meanings of conditions; cause-
and-effect confusion.
These elements present the context in which organizations
view their current and future state. They present
boundaries for planning and policy management. They
come together in ways that either confound decisions or
sharpen the capacity to look ahead, plan ahead and move
ahead. VUCA sets the stage for managing and leading.
The particular meaning and relevance of VUCA often relates
to how people view the conditions under which they make
decisions, plan forward, manage risks, foster change and
solve problems. In general, the premises of VUCA tend to
shape an organization's capacity to:
•Anticipate the Issues that Shape Conditions
•Understand the Consequences of Issues and Actions
•Appreciate the Interdependence of Variables
•Prepare for Alternative Realities and Challenges
•Interpret and Address Relevant Opportunities
For most contemporary organizations – business, the
military, education, government and others – VUCA is a
practical code for awareness and readiness. Beyond the
simple acronym is a body of knowledge that deals with
learning models for VUCA preparedness, anticipation,
evolution and intervention.
 Innovate or Perish
1. Incremental Vs Radical change

2. Strategic type of change

3. Technological change

4. New Product and Services

5. Learning organisation
At some level, the capacity for VUCA management and
leadership hinges on enterprise value systems, assumptions
and natural goals. A "prepared and resolved" enterprise is
engaged with a strategic agenda that is aware of and
empowered by VUCA forces.
The capacity for VUCA leadership in strategic and operating
terms depends on a well-developed mind set for gauging the
technical, social, political, market and economic realities of
the environment in which people work. Working with deeper
smarts about the elements of VUCA may be a driver for
survival and sustainability in an otherwise complicated world.
Psychometrics which measure fluid intelligence by tracking
information processing when faced with unfamiliar, dynamic
and vague data can predict cognitive performance in VUCA
environments.
Themes
•Failure in itself is not a catastrophe, but failure to learn from
failure definitely is. It is not enough to train leaders in core
competencies, without identifying the key factors that inhibit
their use the resilience and adaptability that are vital in order
to distinguish potential leaders from mediocre managers.
Anticipating change as a result of VUCA is an outcome to a
resilient Leader. The capacity of individuals and
organizations to deal with VUCA can be measured with a
number of engagement themes:
•Knowledge Management and Sense-Making
•Planning and Readiness Considerations
•Process Management and Resource Systems
• Functional Responsiveness and Impact Models
• Recovery Systems and Forward Practices
• Systemic failures
• Behavioural failures
 Organization Learning Knowledge Management
Competitive
Strategy

Organization
Characteristics: Organization
• Structure Learning
• Information Organizational
Process:
system • discovery Knowledge: Organizational
• HR practices • Tacit Performance
• invention
• Culture • Explicit
• innovation
• Leadership • suggestions

V U C A preparedness : How Organization Learning

impacts Organizational performance
Human Resource Practices
• Work environment, atmosphere and working conditions
• More suggestions (Employee Satisfaction & Engagement)
• Initiative & Ownership
• Reward & Recognition
• Leadership Development & Commitment
• Organizational Transformation
Managing Change

The Successful Approach: I4

• Inform
– Highlight the dangers lurking round the corner
– Establish the need for change
• Inspire
– Highlight the benefits from change
• Implement
– Involve people
– Allow experiments & tolerate failures
• Institutionalize
– Celebrate successes
A 7-step Roadmap

• Creating a shared need: Why do it?

• Visioning: What will it look like when done?
• Leading change: Who will be responsible?
• Mobilizing commitment: Who else to involve?
• Modifying systems / structures: How will it be
institutionalized?
• Monitoring progress: How will it be measured?
• Making it last: How will it get started and last?
Work towards Open System
1. Environment Awareness.
2. Feedback.
3. Negative entropy.
4. Steady state.
5. Balance of maintenance and adaptive activities
6. Equifinaliy
7. Movement toward growth and expansion.
Thank You
Instilling Attitude for Innovation
• Encourage creative conflict
• Big ideas come from small teams
• Learning happens away from the desk
• Understand the Product’s user - empathise
• Live in the future
• Failure sometimes produces innovation
• Brainstorming for Innovation
 Blocks to Creativity

 Fear of Failure
 Allergy to Ambiguity
 Touchiness
 Conformity
 Resource Myopia
 Starved Sensibility
 Rigidity
 A ….. D ….. R ….. L …..I

•Approach or Planning
•Deployment or Implementation
•Result
•Learning
•Improvement
It is based on four key words:
1. Fundamental
Why do we do what we do? And Why do we do it the way
we do?
Why the old rules and assumptions exist?
2. Radical
Disregard all existing structures and procedures, and
inventing completely new ways of accomplishing work.
3. Dramatic
Not about making marginal improvements.
4. Processes
a. Dysfunctional b. Importance c. Feasibility
Systematic redesign of Processes
1. Eliminate

2. Simplify

3. Integrate

4. Automate
1. Eliminate
• Over production
• Waiting time
• Transport
• Processing
• Inventory
• Defects/ Failures
• Duplication
• Reformatting
• Inspection
• Reconciling
2. Simplify
•Forms
•Procedures
•Communication
•Technology
•Problem areas
•Flows
•Processes
3. Integrate
•Jobs
•Teams
•Customers
•Suppliers
4. Automate
•Dirty
•Difficult
•Dangerous
•Boring
•Data capture
•Data transfer
•Data analysis
Ten key cultural characteristics
• Individual initiative. The degree of responsibility,
freedom, and independence that individuals have.
• Risk tolerance. The degree to which employees are
encouraged to be aggressive, innovative, and risk-
seeking.
• Direction. The degree to which the organization creates
clear objectives and performance expectations.
• Integration. The degree to which units within the
organization are encouraged to operate in a co-ordinated
manner.
• Management support. The degree to which managers
provide clear communication, assistance, and support to
their subordinates.
6. Control. The number of rules and regulations, and the
amount of direct supervision that are used to oversee and
control employee behaviour.
7. Identity. The degree to which members identify with the
organization as a whole rather than with their particular
work group or field of professional expertise.
8. Reward system. The degree to which reward allocations
(i.e., salary increases, promotions) are based on employee
performance criteria in contrast to seniority, favoritism, and
so on.
9. Conflict tolerance. The degree to which employees are
encouraged to air conflicts and criticism openly.
10. Communication patterns. The degree to which
organizational communications are restricted to the formal
hierarchy of authority.