What does a manager really need to master in order to succeed in a VUCA environment?

ValueMiner GmbH, Florian Stillger

For those who haven´t heard yet: The future is unpredictable!
Presidents get elected, expectations minced, markets mashed up – its unheard of, or is it really? Amongst my most precious memories is the fall of the Berlin Wall. Not a single person in the German Government was ready for it. So they took a Russian 10-point plan for such occasion and converted it into a speech held by Chancellor Kohl.
Or another favourite of mine: dear Columbus sailing out into the Deep Blue with no clue, but a funny map (if any).

You all have your own version of what I described above – I am sure of it. So, this is VUCA (volatility, uncertainty, complexity and ambiguity) and we all face it once in a while. The question is therefore, what does a manager really need to master in order to succeed in a VUCA environment?

Basically three things:
1. Dynamic Alignment
2. Adaptation of Capabilities
3. Focused Diversity

Yes, three truly tricky things to accomplish, but nowhere near impossible.

1. Dynamic Alignment
You might think this is really pushing it right, but it isn´t really. Even Herring are good at it or Ants or…you got it, right? We know that Dynamic Alignment is essential for the survival of a species and it always has been equally important for any form of business. There always were and will be those who bet on economies of scale and a USP they cherish and hone to perfection. Those are the industries that are bordering the area of public goods – like knowledge = Big Data = open source. If you are lucky enough to be in one of those markets -  enjoy! For the rest (a rough 2/3rd by conservative count) don’t despair. All you need to do is use visualization and agile alignment techniques to ensure an affordable grade of Dynamic Alignment. Just as Columbus did when he sailed the wind and used currents and did not try to counter it. He aligned his ship and course dynamically with the strategic framework and achieved his objective (or so he thought). So, Dynamic Alignment is done by continuously making your organization aware of your company’s environment and the action at hand.

2. Adaptation of Capabilities
“Adapt or die” sounds dramatic – but it’s the simple truth. The fact, that the average lifetime of a company has dropped to 15 years is not a bad omen as such. It is just a fact. Only negative if a company should be immortal. Any investor will agree that it should. Common sense dictates, that it is hard and only if one is adapting a company’s capabilities constantly. And good news: Most of it is done already. New people get hired, investments are made and so on. Based on an old saying: Capable management will create a capable company.
Problem is, management is simply not able any more to see what’s coming. Or what capabilities are important and to be embedded. That does not spare you from training your team to be great in what capabilities they are providing for the company. A company is simply enough an efficient assembly of capabilities directed with effectiveness towards a business objective. Or as Columbus saw it (I suppose): If you do not know where you are going, train hard. As he did not know where he would sail (He thought Asia)– he did not know where he landed (He thought India) – he still succeeded, because he came back alive (with some of his men at least).

3. Focused Diversity
Ok. By now it should be easy and you guessed it probably already. This mystical management creation is all about having enough eggs in a couple of baskets. “Focused” in this context might be best translated into being tight about your resources. As stated in the Columbus story above, the “Explorer” did not have a clue, but was very tight about his resources (so they say). So, after he got lost on purpose, he created a readiness for success by preserving his resources and making landfall on the next opportunity that promised to be an improvement to his situation. Diversity meaning a being ready for a number of such opportunities/schemes to succeed. This could mean: a diverse portfolio, a number of markets, a wide array of partners, a busy incubator etc. So, instead of sailing on, as he was not really in Cathay (China), he accepted the outcome. Thus being successful despite a true VUCA environment.

by Robert J. Schiermeier