Tuesday, August 27, 2019

How to Deal with Business Dynamic with “Unpredictability, Uncertainty, and Unrepeatability”

It is no surprise that there is a tension between “old and new,” from the business model, mindset, process or practice perspectives.

The tides of change and waves of disruptions indicate that business leaders couldn’t predict the future with a certain degree of accuracy. To tackle great challenges with grand consequences over long time spans, they need to become highly visible, proactive, and innovative for dealing with an unprecedented level of uncertainty, unrepeatability, and unpredictability effectively.

Unpredictability: Modern organizations are complex systems that tend to be non-linear and thus, hard to predict the upcoming changes on the way. Often, a part of the nonlinear business system emits more energy and that’s going beyond the linear response of that part. It means small changes in the initial conditions could have much larger and unpredictable consequences in the outcomes of the business system. From the business management perspective, even though you couldn’t predict anything beforehand, you can always imagine different scenarios based on “lessons learned” with many experiences involved in current or in the past. Although not everything is predictable, information is still one of the most important assets of the company. It is a complex domain and information becomes meaningful when being sort through and processed to make sure its coherence. When information is refined into the business foresight and customer insight, it becomes the “light tower” to navigate the business in the right direction. It requires to take leaps of setting some of the right things in motion, and delicately balancing and re-balancing the results toward urgent, but hard to predict outcomes.

Uncertainty: The pace of change is accelerated both in businesses and society, either as an individual or an organization. Uncertainty (of outcomes or occurrences) is inherent in almost every business endeavor, More specifically, uncertainty is a state of having limited knowledge where it is impossible to exactly describe the existing circumstance. From a strategic management perspective, although it is not so much you could do about the uncontrollable situation. Still, a good plan can identify external business factors and a structural process can enable an organization to walk around the externals. From a leadership perspective, great leaders supply the framing context in understanding uncertainty and encourage optimism, help to mitigate the impact of uncertainty or risks by enabling a team to encounter uncertainty and deal with it strategically and systematically. They need to visualize and identify uncertainty, convert uncertainty to risk through the application of quantification methods in order to be able to manage uncertainty as risk, and move up management maturity from risk mitigation to risk intelligence.

Unrepeatability: Due to the “VUCA” digital new normal, change is unavoidable and digital disruption is inevitable. Businesses become complex if things do interact, particularly in the case of "nonlinear" interaction with un-repetitive activities and behavior. Nonlinearity, hyper diversity, fewer rules, and regulations, information exponentiality, unpredictability, etc, are all causes of unrepeatability. Therefore, today’s business leaders and professionals need to be open-minded, resourceful and learning agile, be able to effectively handle issues that they had never met before and overcome some unrepeatable challenges smoothly. To improve collective and collaborative problem-solving competency, business leaders should take a holistic look at the variety of business relationships and interconnectivity, enforce cross-functional communication and collaboration, apply interdisciplinary management approach to frame bigger thinking boxes and deal with many complex and unrepeatable business issues technically, scientifically, and culturally.

It is no surprise that there is a tension between “old and new,” from the business model, mindset, process or practice perspectives. To survive the “VUCA” digital new normal and thrive with the long-term business advantage involve more planning, adjustment, and speed. In today's interdependent global economy with high level of unpredictability, uncertainty, and unrepeatability, that will need a new model of leadership in which openness, vision, innovation, multidimensional intelligence, learning plasticity, flexibility, transparency, become necessary features. Lead by influence, not brute forces. The most critical and yet overlooked foundation of being a real leader is in choosing a destination that creates a better world!


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