What’s going to get businesses out of this mess?

We’ve been talking about a VUCA world for a long time. VUCA stands for volatile, uncertain, complex, and ambiguous. Ha! We didn’t have a clue what VUCA looks like. The business environment we’re in right now – this is VUCA, this is the real thing.

What are the qualities that will enable a business to survive and thrive in this VUCA world? A recent article in Consulting Psychology Journal provided a very interesting framework to answer this question. 

To survive, organizational agility must work from the top down

We’ve been hearing a lot about leadership “agility,” the ability to change direction quickly, handle stress, adapt, and embrace change. Much of this conversation has focused on individual leaders and teams, but in a crisis like this, we need to focus on organizational agility. The article defines organizational agility as “proactively sensing and redirecting in order to chart a competitive path by rapidly reallocating resources, building new capabilities, and jettisoning assets and activities that no longer create value.” 

A second crucial quality is organizational resilience, which means “how quickly and effectively systems can bounce back to a prior positive state or equilibrium and resume normal operations following a jolt." I can’t think of a more important predictor of organizational success as we come out of the COVID crisis.

How can business leaders build organizational agility and resilience? The article, based on a study of 325 organizations, described three important conditions that led to agility, resilience, and ultimately competitive success. 

3 conditions for handling a VUCA world

First was “right-sized teamwork.” Contrary to the popular opinion that more collaboration is always a good thing, the authors found there is no single model that defines good teamwork across different situations. Sometimes the work is done better alone and sometimes you need a team. Agile, resilient organizations are led by people who actively right-size the amount and type of teamwork to optimize performance for different kinds of tasks.     

The second important condition was “relentless course-correction.” That means managing performance in real time, adjusting to changing conditions, seizing opportunities, and rapidly diagnosing problems. This is only possible if people have access to good metrics than enable them to track their progress and adjust quickly. 

The third condition, perhaps somewhat surprisingly, was stability. We sometimes imagine that agile organizations are in a constant state of flux. But in fact, stability provides a solid foundation that helps people stay focused on performance.  Stability means that people feel secure in their roles and confident in the leadership. 

Underlying these three conditions are the qualities of focus, simplicity, and clarity. The most agile, resilient organizations help their employees reduce complexity, clarify the rules for getting the job done, and remove unnecessary distractions.   

As business leaders struggle to navigate their current challenges and plan for a future that is highly uncertain, focusing on building and encouraging organizational agility and resilience is a proven way to drive organizational profitability and competitive success.

If you would like some guidance with making sure your team can handle this, please email me at ggolden@gailgoldenconsulting.com.