The threats and opportunities in the Age of Uncertainty
We live in the Age of Uncertainty. From individuals, to families, communities, social groups, governments, business entities, international organisations—we all live in an environment which is much different from what we used to live in, and increasingly so. Its main feature is complexity—defined by constant changes that occur rapidly and simultaneously in various dimensions, abundant but fragmented information, and unpredictability of future (even immediate) developments.
The Age of Uncertainty challenges us. It poses multiple and unforeseeable threats but also offers unprecedented opportunities. Just look around: the rate and scale of demise of big companies, transnational corporations thought to be ‘well-established’ in the market for decades is exponentially increasing. But so does the rate and scale of new, incredibly successful fresh entrants. Consider Facebook, Google, eBay. But that’s not all Tech: think of companies like Uber—at a $50 billion valuation, the on-demand taxi company is more valuable than at least 70 percent of the Fortune 500. Opportunities are elsewhere, in any sector, new or old.
“In complex situations, an opportunity often avails itself in totally unexpected places, directions and forms that are not possible to discover or predict by logical computation (whatever artificial intelligence or big data employed), historic cases or trend extrapolation.”
The task therefore is making best of the opportunities the Age of Uncertainty offers. In complex situations, an opportunity often avails itself in totally unexpected places, directions and forms that are not possible to discover or predict by logical computation (whatever artificial intelligence or big data employed), historic cases and experiences or trend extrapolation. This is where curiosity equipped with unorthodox, flexible approaches and experimentation can do much better than ‘old school’ ways—after all, we do live in totally different times.
Is it enough answering the tested right questions?
All businesses, whether start-ups or established corporations, use the same set of questions for strategic planning: What business are you in? What is your purpose? Who is your customer? What is your value proposition? Who are your competitors? What is bargaining power of suppliers and customers? What are the risks?
Anyone who has written a business plan, or participated in their firm’s strategic planning exercise is familiar with those questions—all strategy frameworks start and end with them. They all stay relevant today.
True, posing and answering the right kind of questions helps. You will also do well by asking right questions regularly. My question, however, is: Whether it is enough asking the same, even tested and proved useful, questions in the Age of Uncertainty?
I think there are a few very important questions missing in this list. They concern your decision making. Because at the end of the day, it is how you answer those questions matters, not the mere fact that you pose right questions.
In a series of posts I will share my favourite decision making processes and methods which I think are best suited to complex situations when decisions have to be made under the time pressure and information constraints. I have tried them, in various modifications and combinations, over many years working in academia, private and public sector, in headquarters and in the post-conflict field settings, in well ordered and highly volatile situations.
And note that these methods are not ‘fixed’ as in a textbook—I keep working on them, reviewing, re-applying, and testing all the time. They combine old-school logic based approaches with experimental, recursive processes and intuition based decision rules. Moreover, it has been proven by the experiences of those working in emergency situations that this kind of decision making strengthens an individual’s and organisation’s resilience and adaptive capacity and, thus, increases their chances to succeed in the Age of Uncertainty, complexity, and wicked problems.
How do you make decisions?
The way how we make decisions matters. Greatly matters. We all know it too well, from our own experiences and those of others—individuals, companies, governments. And we have learned from both successes and failures (although, to be honest, failures are bitter but better advisers).
So, how do you make decisions? Below is a list of questions I think you will find useful to start with. It is not exhaustive, neither intended it to be—my role here is to give you a hint, to inspire you to think creatively. After all, this is the essence of the very approach I stand for. Here you go:
- How do you strategize: Do you fix your plans into existing data or make data work for your plans? Do you set long term plans that are set in a stone or are they subject to regular revision?
- How do you analyse: which formal and informal processes do you follow? Which methods do you apply at different steps?
- What data do you use: external or generated by your own activities; only statistical or also qualitative, narratives? How do you store it and make readily available (i.e. is it useful for daily decision making)? How expensive is it to collect, process, and store or share it?
- What are your rules (or thresholds) for stopping the search for decision, making decision, and moving into action upon it?
- Do you always look for perfect decisions? What best decision means for you (or your company)? How do you review your decisions, what are checks and balances?
- How flexible you/your business are in adopting test and trial approach, in employing adaptive, tactical approaches to resolving big and small issues?
- Is creativity, risk taking, learning from failures part of your company’s culture? Are these qualities encouraged by the management/stakeholders or punished (in real life, not in the company’s policies and formal statements)? What incentives does the company use (either way)?
Think about it. Whether as individual, family, team or company—you will find the very process beneficial. This is what I can guarantee. It is a starting point of a never ending and highly entertaining journey. I will try to be of use, especially at your initial steps, to share my experience and knowledge.
For other articles in this series see Five Simple but Powerful Mental Shortcuts