Livin’ la vida VUCA. How to survive and thrive as the leader of people and culture?

VUCA world. Volatile. Uncertain. Complex. Ambiguous. Yes, this is the world we are living in. Recent years have proven that crises exist and the scenarios never repeat themselves in detail. The problems and root causes are different and often we are helpless in doing anything about the root cause. While the issues have been very large in scale, they have also provided opportunities beyond the wildest expectations.

For example, the rapid growth of hybrid work and e-commerce. Or 2022. We have the war in Europe. Certainly, the surprise of decades. Although the direct impact is felt by the people living in Europe, the influence is global. Inflation and high energy prices have made many jobs disappear and caused difficulties in coping with increasing living costs for billions of people. But at the same time, the existing loans are becoming cheaper faster because of inflation and the high energy prices make green energy projects more feasible. 

So there are pros and cons. The main question is how to be ready for the next big thing. How to mitigate the risks and be ready for the opportunity? The last years have proven that it is not important what happens next and why. The only thing that matters is how you will deal with it. 

Let’s look at the challenges of VUCA from the (people’s) management perspective.

VOLATILITY

What will be your company’s employee attrition? How many people are you going to recruit? What are the business focuses and how are they changing? What roles will be upskilled? Considering the experience from the past few years there are probably many unknown unknowns. 

The ability to cope with volatility is down to agility and awareness. Awareness of the business drive, employee experience and engagement, and of course the ability to change. Ability to stop, refocus, undo and redo. Agility in everything. 

It requires a vast range of expertise and a lot of flexibility. How to ensure you have it? What should be the balance between internal and external resources? What arrangements should be made to have access to the resources when needed?

UNCERTAINTY

It will hit you from every possible angle. Employees are insecure because of the war, because of immigration, because inflation, and they do not know if they can pay their next electricity or gas bill. It will make a perfect scenario to drive a sane person mad if you add job security to the list of concerns. 

According to Personal Capital study, fear of rising inflation (85%) and worry about the recession (74%) are trending. 54% said that anxiety about the current environment has influenced their work performance. 

But supporting the managers and staff in keeping morale and productivity high is only one aspect. Most businesses have prepared their 2023 business plans on gut feelings. I’m sure the best expertise has been used, but really, how can you predict the future based on the past 3 years and considering the inflationary environment? I believe employee experience monitoring will be as important as budget monitoring and adjustment to many more managers. 

Communication is the key to execution and cannot be overlooked. It can make or break it. The purpose is to create a sense of certainty, but it can easily go wrong. Less is more, is probably not applicable here, but immature messages are also not good.

What if it does not work out as planned? What shall we do? When? Which indicators are important to see as far into the future as possible? What parameters should be used to validate the concept? Who should react, who should act, and who should communicate to the rest? 

Being prepared is better than being surprised. Having an action plan, risk scenarios and playbooks become handy in uncertain times. 

COMPLEXITY

The problems around us are complex. We are open to so many risks. The central banks were years in pain about introducing inflation. And it took a single madman to start a chain of events that switched from printing money to fighting inflation within months. The chain itself is not very long, but every event in it has enormous side effects. Global and regional. Many of these depend on the nature of the business, region, currency, governmental substitutions, and even on lifestyle. 

Risk assessments and plan B-s are well justified. But there are so many unknown unknowns. Highly regulated sectors have the upper hand as they are used to risk reviews and scenario analyses. They probably have triggers for early alerts. On the other hand, doing a mandatory risk assessment may feel bitter as the previous risk assessments may have turned out to be not too useful. 99.9% of companies did not foresee the war, energy crises, and sudden rise in the price of capital (inflation) for 2022. The same goes for the Covid-19 breakout and the e-commerce boom that followed. 

What’s next? I don’t know. Nobody knows. Change is the only certain thing, and we should be prepared for it. There is a pattern emerging when analyzing the winners and losers of the Covid-19 crisis. All companies using outdated technology were losers. Leaders who considered a home office day just as a day off had to change their beliefs and behaviors radically. And this is neither easy nor cheap. The winners were practicing hybrid work already and had e-commerce channels up and running. Generally speaking, naturally. But think about it. Hybrid work was possible already in the last century. And when exactly was Amazon established? Everybody facing severe problems in these fields was just late to the party. Simple as that? No, it’s complex. 

Have you figured out what the big fuss is about the Chat GPT? Why not? Do you think that it will not impact your business in the coming years, months, or weeks? Just like e-channels and remote work did? According to a recent study reported in the Times almost 30% of the nearly 4,500 professionals surveyed, said that they’ve already used OpenAI’s ChatGPT or another artificial intelligence program in their work. 

AMBIGUITY

What should we do next? Wrong question! How should we do it and why? Best practices were best for yesterday. One size fits all, but not very well. There are different shades of gray that meet our personal values and those are valued more than black-and-white solutions. Values and beliefs matter more than financial results, valuations, and rankings. 

Modern organizations are facing contradicting objectives and need to address them. The winners from the last crises’ did not just invest millions to establish remote work capabilities during the health crises but did so to protect the lives of their employees and families. It is the same thing, but the mindset makes the difference. 

Moticheck global averages, mapping the employee experience mostly in Europe, showed only a slight decrease during 2022. Pille Parind-Nisula concludes in her article “One year of Moticheck Global Averages”, that the companies who were listening to their employees’ feedback frequently managed to cope with the stress, change, and threats very well, considering the circumstances. 

We know that some employers are emerging as socially attractive. Are they losing out on the stock market? Not really! One may wonder why aren’t all organizations are more socially responsible and caring. Well, I think they just aren’t. They run for profits, rankings, and volumes. And it may still be a good short-term investment. We just don’t know how short. Depends on what world they are living in. I’m living in a VUCA world. Necessarily I wouldn’t say I like it, but nobody asks for my opinion. Nor yours. 

CEO and Founder @Moticheck