VUCA and the Portfolio Executive: Part One – Introduction

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For those who haven’t heard of VUCA, it is a military doctrine developed after the Second World War when people recognised that conventional warfare wouldn’t be the only way to respond to military threats.  They realised that the world was Volatile (V), Uncertain (U), Complex (C) and Ambiguous (A).  Recognising these four characteristics, it became clear that organisations needed to respond differently.

In this series, I will deal with each of these letters and explain what this means for organisations and portfolio executives, as well as two different kinds of responses you may make to a volatile world.  Before I do that, I want to outline different reactions to a volatile world in summary.  There are two models for a response to a VUCA world:

Model 1: 

To deal with Volatility, you need to hold firmly to your Vision.
To respond to issues of Uncertainty, you need to hold firmly to principles and develop more Understanding.
To respond to the challenge of Complexity, you need to develop more Clarity.
To deal with an Ambiguous world, you need to be more Agile.

This makes sense in a conventional business context, but I believe there’s a much more powerful way to respond to these challenges.

Model 2:

In that more powerful way, as a leader, I would suggest that in response to Volatility, you must offer a Vulnerability stance.  ‘I don’t know everything’. 
In response to the challenge of Uncertainty, you need to foster strong Unity. 
For the challenge of Complexity, you need to draw on the strength of Community. 
Recognising Ambiguity, you must engage with the power of Acceptance that some things are out of your control.

Model 1 + Model 2 = Model 3

So now we have three levels to make up Model 3:

  1. If you take a Vulnerable stance and develop your Vision, you’ll be more able to respond to Volatility.
  2. If you build Unity as a leader and develop Understanding, you’re more able to deal with Uncertainty.
  3. If you build and strengthen Community and foster Clarity, you’re more able to deal with Complexity.
  4. If you come to Acceptance that some things are out of your control but also commit to Agility, you can more effectively navigate the world’s Ambiguity.

This is the initial framework.

Foresight, Action, Hindsight

With a strong Vision, you can bring more vital Foresight and enable yourself to strengthen your intuition; you can get insight from that intuition.  Complementary to Foresight is Hindsight—looking backwards for insight and using this insight to help you understand how you respond.  You are now informed to take Action in the present.

With your foresight, action in the present and hindsight, you are able to create and evolve an effective strategy.

But how do individuals move through this complex new space?

Feel, Believe, Know, Do

As you exercise leadership, recognise that any change starts by moving through a journey of experiences where you shift the way you Feel, allowing you to Believe differently, draw on new ways to Know and shift your thinking.  A call to action takes you to place where you move to Do.

Ignoring the journey of emotion in the context of change will ultimately undermine the capacity to act.  Changing your beliefs about your situation, world, or truth will ensure your current mindset supports your thoughts.  You need to think through and imagine in advance what you’re going to do, or else you’re unlikely to bring that action to fruition.  You’re much more likely to be constrained by reacting rather than pursuing coherent action.

Now, we have a rich model of what it means to respond in a VUCA world.

In subsequent articles we will look at the more detailed implications.

VUCA and the Portfolio Executives: Part 2 – Volatile

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Charles McLachlan is the founder of FuturePerfect and on a mission to transform the future of work and business. The Portfolio Executive programme is a new initiative to help executives build a sustainable and impactful second-half-career. Creating an alternative future takes imagination, design, organisation and many other thinking skills. Charles is happy to lend them to you.