VUCA: Volatile, Uncertain, Complex and Ambiguous

30 September 2019 | VUCA is an acronym, first used in 1987, drawing on the leadership theories of Warren Bennis and Burt Nanus. It stands for Volatile, Uncertain, Complex and Ambiguous. (Kraaijenbrink, 2018)

For most contemporary organizations – business, the military, education, government and others – VUCA is a practical code for awareness and readiness. Beyond the simple acronym is a body of knowledge that deals with learning models for VUCA preparedness, anticipation, evolution and intervention. (Satish & Siegfried, 2006)

Volatility – Volatility refers to the speed of change in an industry, market or the world in general. It is associated with fluctuations in demand, turbulence and short time to markets and it is well-documented in the literature on industry dynamism. The more volatile the world is, the more and faster things change.

Uncertainty – Uncertainty refers to the extent to which we can confidently predict the future. Part of uncertainty is perceived and associated with people’s inability to understand what is going on. Uncertainty, though, is also a more objective characteristic of an environment. Truly uncertain environments are those that don’t allow any prediction, also not on a statistical basis. The more uncertain the world is, the harder it is to predict.

Complexity – Complexity refers to the number of factors that we need to take into account, their variety and the relationships between them. The more factors, the greater their variety and the more they are interconnected, the more complex an environment is. Under high complexity, it is impossible to fully analyze the environment and come to rational conclusions. The more complex the world is, the harder it is to analyze.

Ambiguity – Ambiguity refers to a lack of clarity about how to interpret something. A situation is ambiguous, for example, when information is incomplete, contradicting or too inaccurate to draw clear conclusions. More generally it refers to fuzziness and vagueness in ideas and terminology. The more ambiguous the world is, the harder it is to interpret.

Nathan Bennett & G. James Lemoine, 2014. What VUCA Really Means for You. Harvard Business Review
  • Jeroen Kraaijenbrink (19 Dec. 2018). What Does VUCA Really Mean?. Forbes
  • Satish, Usha and Siegfried Streufert (June 2006). “Strategic Management Simulations to Prepare for VUCAD Terrorism”. Journal of Homeland Security. Archived from the original on 2011-06-08.

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