VUCA and HR: WTF?

VUCA is an acronym that stands for volatility, uncertainty, complexity and ambiguity: elements that make a situation difficult to analyse, respond to or plan for.

The acronym VUCA was first used in the U.S. Army War College in 1987 to describe the volatile, uncertain, complex and ambiguous world resulting from the end of the Cold War. The method was developed after concepts presented by leadership theorists Warren Bennis and Burt Nanus in their 1985 book Leaders: The Strategies for Taking Charge.

In more recent times, VUCA has become a popular managerial acronym relating to organisational failure and how both systemic breakdown and the behaviour of individuals and groups in organisations contribute to this.

Quick definitions of each of the VUCA terms?

• Volatility is the quality of being subject to frequent, rapid and significant change.
• Uncertainty occurs when events and outcomes are unpredictable.
• Complexity involves a multiplicity of issues and factors, some of which may be loosely or intricately interconnected.
• Ambiguity is shaped by a lack of clarity and difficulty understanding exactly what the situation is.

In practice, the four terms are related. The more complex and volatile an industry is, the harder to predict and therefore more uncertain it will be. VUCA can also result from a CEO or leader with a certain personality type…think working for Elon, Donald or Kanye.

A little VUCA might be OK and in certain situations even beneficial…a catalyst for positive change or innovation. A lot of VUCA – or operating in a continual VUCA environment…not so much. Take the example how COVID has impacted many of our businesses. From a HR perspective, a VUCA environment in your workplace can:

• destabilize people and make them anxious
• sap motivation
• make constant retraining a necessity
• increase the chances of poor decision-making
• take a toll on your workplace culture

If your business or industry is affected by VUCA, its logical to conclude you should factor this in to the way your business and people operate. Communicate the VUCA concept to your leadership team as part of situation analysis to help them assess what is known and not known about a scenario so they can plan to quantify risks and create mitigation strategies. When your business is proactive and sets the agenda for change, you are less likely to experience the full extent of its threats. Implemented in a timely and effective manner, such planning can result in identifying new markets and growth opportunities when your competitors fail to factor in their own VUCA elements to their own operational and strategic planning.

Like to know more about setting your people up to operate successfully in today’s rapidly changing business environment? Give Bare Bones Consulting a call. We’ll transform your VUCA from volatility, uncertainty, complexity and ambiguity to vision, understanding, clarity and agility. A much more preferable acronym, no?