The last year or so, amidst the gloom of the pandemic, has shown how businesses are in need to adapt to the frivolous changes it demands. The cycle of market demand and supply has been greatly affected, but moreover, a state of flux has been created by this pandemic which is eagerly pushing the business environment towards becoming more unpredictable. It is no surprise that we live in a VUCA world. But what really is VUCA? Allow me to explain.
The US Army War College was among the first ones to use VUCA as a term, which stands for volatility, uncertainty, complexity, and ambiguity. Sounds very gray doesn’t it? Not trying to be your Chief Pessimism Officer or anything, but the competition is fierce out there and the need for business transformation has intensified. So, to ensure that you don’t fall prey to ‘Digital Darwinism’ you must understand technology better and integrate it with the right business strategy.
So, here’s what the term really means, especially for you:
- Volatile: Change is inevitable and rapidly progressing in the business environment. And this very unpredictable nature means you need to do a deep dive into improving your business operations to reduce human dependency for manual and redundant tasks.
- Uncertain: There is always some amount of uncertainty about the business environment. A lot of factors can change overnight which can result into unclear decision making or even no decision making at all! For you, it means you need a better understanding of the changing market demands.
- Complex: There are a lot of challenges involved in any business. There are multiple factors that affect an effective operational strategy that can cause unforeseen issues that one needs to navigate from. As for you particularly, the complexity lies in redefining your business value proposition to suit the demands of the digital world.
- Ambiguous: Most of the times there are situations that present themselves naturally, posing a threat to the business, which one has no control over. We simply lack clarity and awareness in such conditions. Ambiguity can be culled when you strengthen collaboration and communication with all the stakeholders in the ecosystem.
In our recent joint survey with the Confederation of Indian Industry (CII), we found that 70% innovation in digital transformation is unrealized. Organizations face a lot of challenges in the VUCA world, it could be difficulty in adopting to the digital world, lack of awareness of external environments in the business ecosystem, the direction of technology evolution, or even being unable to identify the right business properties due to ‘digital immaturity’.
To rise up to those challenges, you have to make choices that can help you embrace digital transformation, and that calls for the use of the Magic Triangle Framework to strike a balance between business, people, and technology, all mapped to the core business strategy.
So, what are the skills that you need to thrive in a VUCA world?
- Vision: Keep your view positive and look at things differently for growth and to stay ahead of the curve. This pandemic will enable a lot of opportunities the world had never seen before. Hence, your focus should shift from what you had to what you can have. So, to manage in the VUCA world, you need to have the vision, be like the 11% percent CIOs who partner with startups to gain insights and use the fail fast technique to grow.
- Understanding: VUCA’s elements are dynamic. The uncertainty it creates is certainly a disturbing one. But you can respond to it in a positive manner by considering new ways to develop, learning from the mistakes, and analyzing your business needs. Our survey findings suggest that, 34% companies have already re-shifted their focus to adoption of digital strategies to enhance customer experience. In order to bring digital transformation in your business model, there are 3 things you need to understand.
- The What – This is the value proposition your business offers to its stakeholders. Here, you will figure out how to go from ‘doing digital’ to ‘being digital’.
- The Who – Here, you will define your target segment, relationships, and channels to generate revenue streams. You will form new entities and relationships with the right application of technology to transform your business model.
- The How – The activities, partners, and resources needed to deliver the value proposition you identified in the ‘what’ part. It could either be the active, voluntary way, the organized way, or the reactive way, which can affect your business due to its unplanned and unexpected nature.
- Clarity: For most organizations, it is challenging to stay relevant in the VUCA world. But one thing that would make all the difference is a clear communication channel between you & your peers. It will help re-align your business goals. Team development and resource retention are the essential factors in gaining an edge over the competition. So, you must focus on developing a well- defined plan for advancing your digital transformation journey.
- Agility: Planning can save you a lot of trouble in the VUCA environment. Preparing for contingencies wherever possible and enhancing your learning quotient can take you places in difficult times. When you embrace adaptability on your own, you thrive dynamically. This also means that you have digital maturityin place.
To survive in the VUCA environment is going to be challenging as well as exciting but applying the right skills at the right juncture will help you sail through smoothly with little hiccups here and there, of course. No journey is easy.
Although, you can efficiently mitigate most of the problems that will rise in the VUCA world, all you need to do is build a robust team having best talent, have a defined data strategy, define your goals, identify the critical data sources, and establish the right leadership.
Write to us to know more about our services, learn how to leverage your data for decision making, or learn how to prepare your business for the digital unknown.