It’s no secret that the world is unstable and changes daily. The acronym VUCA was created to portray the environment we live in today.
Every day new things appear in the world. Some of them are completely revolutionary and turn situations upside down, making yesterday seem like something too old.
Although this is not a new concept, many people and companies still don’t quite know what it means. Therefore, they also do not know how to behave and what to do to minimize the effects of this world that we all inhabit today.
In this article, you will understand what means VUCA to the business world and its main role in working with Agile methodologies.
What is the concept of VUCA?
The acronym comes from four hallmarks of our society: volatility, uncertainty, complexity, and ambiguity.
It was created in the late 1990s by the US military to describe possible war scenarios to be faced. In 2010, the term started in the business world as well. After all, the business environment is also based on a context of doubts and solutions to be resolved.
The origin of the term is in the military universe. In the 1990s, the US military began to use the acronym VUCA to describe the possible scenarios and contexts of war that could be faced. Thus, it was possible to make contingency plans to act according to each situation.
Being open to new possibilities in an environment of uncertainty certainly involves the desire and courage to move along new paths that have never been used before.
The meaning of VUCA
The VUCA world refers to the characteristics of the era in which we live. Therefore, you need to understand them to anticipate these changes and create a consistent marketing strategy.
Stability and security seem two distant concepts for companies from different sectors in this reality.
Understanding how each of the factors that make up the new rules of the marketing game materializes is the first step in managing the situations that leaders are subjected to daily.
Volatility
Previously, it was simpler to predict scenarios, however, nowadays this has become practically impossible. The amount of change and the speed with which it takes place makes the world quite unpredictable. More important than using your precious time to make plans is being prepared to deal with the unexpected.
Volatility refers to the agility with which changes have taken place in the market. This can be easily seen with the changes in consumer behavior facing the digital revolution.
Today’s shopper is more interested in the shopping experience than the price and can switch to the competition at any time.
It became difficult to follow a structured path towards the full realization of goals. The most interesting approach is to have clear purposes and expectations possible to achieve in different scenarios. There are no certainties, just possibilities, and being ready for each one of them is the difference.
Uncertainty
We live in the information age, there is a great volume of information at our disposal. However, not all of them are necessarily useful for understanding the paths of the future. Disruption has become a keyword in a context where significant changes happen every second.
Strategies outlined may need rapid changes if the market changes abruptly.
While strategic planning is essential for marketing, there is no guarantee that the external and internal scenarios will always be the same. The insecurity of this volatile world causes a scenario of uncertainty in companies, making it difficult to accurately predict the future.
This means that many solutions that are successfully employed today are unlikely to be effective tomorrow. While it is possible to clearly understand the cause-and-effect relationships of a change, we cannot estimate all of its unpredictable consequences.
Complexity
Complexity tends to enhance connectivity and interdependence. The exponential number of variables related to these interconnected contexts makes it almost impossible to encompass all the issues and risks to make decisions. As actions are part of a complex system, it is difficult to predict their results when they are isolated.
Therefore, actions related to economic and political factors, for example, can impact social and cultural issues.
Thus, it is necessary to have a systemic view of the business’ positioning in the market and understand what impacts the company may suffer as a reflection of the reactions of stakeholders.
This complex system in which we live requires the Marketing professional to have a linear knowledge of all areas related to the product or service.
Ambiguity
Complex contexts open up different possibilities for interpretation and analysis, something that creates cloudiness and ambiguity. You can’t analyze disruptive transformation based on history and experiences. This is an entirely new scenario and this allows for several pertinent interpretations.
Ambiguity deals with the consequences brought about by all of the above characteristics. Because we live in a volatile world, with an uncertain and complex scenario to understand, we can have many different interpretations. The proof of this is the excess of information we have.
Tools such as Scrum, Kanban, and SMART have the advantages of reducing risks, delivering higher quality results, projects more in line with what the client wants, flexibility to make changes, saving resources, etc.
In the current scenario, doing projects with traditional methodologies using long schedules is unfeasible. After all, suddenly priorities can change and what seemed important can become irrelevant.
VUCA World Challenges
The VUCA world is the result of a society full of possibilities due to technology and globalization that daily alter human relationships and experiences. It brings new solutions to old problems that, many times, already had a solved product or service.
Thus, what professionals need is to strengthen skills and outline clear intentions for companies. Also, adapt, among other qualities, is a determining value of organizational culture.
Developing management and strategic planning to meet emerging demands is an irreversible process for those who want to be successful and face the challenges of this new scenario.
How to adapt?
It is necessary to anticipate all this to deal with the characteristics of the VUCA world.
In this sense, some practices are essential to have flexibility, agility, and innovation amid this scenario. Thus, you can keep up with these market changes and adapt your strategies whenever necessary.
Set different scenarios
Scenario building analysis is a fundamental action to deal with the VUCA world. Through it, it is possible to identify possible gains and losses from different paths and, thus, explore hypotheses to make the best decision.
In practice, this construction of scenarios consists of creating plans derived from the primary strategic planning, changing internal and external variables of the business model. Among them, new distribution channels, a mix of products and services, and cost reduction.
Look for top trends
Another way to prepare for the VUCA world is to closely monitor trends, both in marketing and in your industry. They indicate which direction the market is taking, allowing you to anticipate possible changes.
In addition, this analysis allows you to identify opportunities to position the brand, improve products and services, and even create a new business model.
For this, you can follow influencers in the area and search for surveys and reports from your segment. You can also invest in analytics, look at what competitors are doing, and listen to feedback from customers and suppliers.
Invest in Agile management
Amidst all this complexity, a new way of managing teams and projects emerged, which is agile management.
This methodology allows changes to happen more easily and quickly, adapting to this characteristic of the VUCA world. This practice breaks goals down into small goals, SMART style, hitting one target at a time.
In this way, it is possible to analyze the results during the conclusion of each step. It allows the strategies adjustments according to the answers obtained.
Autonomy and resilience
The employees of a company must have some degree of power in decision-making. For this, network structures work better than rigid hierarchies and overly bureaucratic systems.
Resilience is another characteristic that individuals and organizations must practice. It is necessary to know when to give up on projects when to transform them into something else. And, on the other hand, when to insist on an idea, betting that it will pay off later on.
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