Product Design
April 23, 2020

VUCA, A Model for the Future

During the past few weeks, times are more uncertain than ever in our lifetime. The unexpected impacts from Coronavirus pandemic introduced unprecedented challenges to our economy, health, safety and livelihood. The interdependencies on supply chains for life-saving ventilators, masks and healthcare workers introduced complexities not imagined previously. Although we have had to quickly adjust and make changes to the way we live and conduct business, we must adapt for a future that looks quite different than today.

Frameworks like Vulnerability, Uncertainty, Complexity and Ambiguity (VUCA) provide a way to look at the future. This 25-year old model popularized in business schools and in the Harvard Business Review, gives us a framework to consider how to adjust the new normal, whatever that may be.

There are elements of each quadrant in the current crisis:

  • Volatility - We can see what's happened in countries where Coronavirus broke early and what's mitigated the short term so we can prepare for the similar set of risks.
  • Uncertainty - At the same time, the US is a very unique country. Our large land area means our transportation and retail worlds need to change dramatically, and our federal system of government means Americans are constantly negotiating 'who's in charge' in a crisis.
  • Complexity - We're seeing the interdependence in local, national, and international logistics. And the US has complexities in the healthcare system with insurers (payers), providers, and governments all attempting to make changes at the same time.
  • Ambiguity - Coronavirus is also the first pandemic to take place in a world of easy global transit, awash in data of people and populations, and with a healthcare system with more data than ever before.

Now more than ever before is the time to plan for the future. We know that when the economy returns, things will be different. What are the scenarios that are most likely to face our business? What new levers should entrepreneurs consider? What is likely to remain in demand? What are the long term versus short term impacts?

By asking these and other questions, we can build scenarios about what the new normal may look like. Everyone wants to return to a time where you can interact with friends and family again, but will we be likely to shake hands and hug each other? Will washing hands and avoiding crowded gatherings remain with us as a new consumer behavior? Will western societies embrace wearing masks as an everyday habit? How will risk management change?

As an optimist, I believe we can learn and grow from this crisis.

We are building a path forward that shields us from some emergent situations and enables us to adapt more quickly to others. By using VUCA, we can more thoroughly prepare and thrive in the era of pandemics and other disruptions.

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