Navigating VUCA Environments: Understand Volatility, Uncertainty, Complexity and Ambiguity


I admit it, every time I try to remember the meaning of the acronym VUCA, I have a hard time. Something happens, that I don’t have the words that form it. Volatility, Uncertainty, Complexity, Ambiguity. Or what is the same, in the language of Cervantes: Volatility, Uncertainty, Complexity and Ambiguity. This is the acronym used to define the complex environment in which the world moves today. And the truth is that I don’t know about you, but in my case, my environment is quite well described by those words.

  • Volatile: That changes or varies easily and in an unpredictable way.
  • Uncertain: That is imprecise or fuzzy, unknown.
  • Complex: That is difficult to understand because it is made up of many aspects.
  • Ambiguous: That can be understood or interpreted in different ways.

In my sector, finance, the environment is very VUCA (we see it in the next paragraph) and it is this fact that makes my day-to-day work also VUCA. But this is certainly valid for many sectors. It is one of the consequences of living this process of digital transformation of the world. It’s a lot of fun, true; very interesting, true; but it’s a roller coaster. Jerónimo Sánchez already says it on J.M.Bolivar’s blog “The predictable and more or less static work environments in which our grandparents worked belong to the past”. And there is no claim sheet. It is what we have to live and period. If you do not agree, it is better to get off at the next stop. Let’s look at some examples.

In the Spanish banking sector we have gone through a major crisis, and the number of resulting entities is much lower than it was ten years ago (volatile); What’s more, we don’t know if all the existing ones will remain or there will be more concentration (uncertain) (Note when editing – yes, the banking concentration continues and there are more and more mergers and a smaller number of entities); not even if the competition is really going to be between banks or new players will appear like Apple, Samsung or how the world of fintech (complex) will continue to develop; but we also don’t know if the solution involves transforming or reinventing itself from scratch (ambiguous). And this is an analysis of a paragraph of the sector focused almost exclusively on its most technological side. But if we add to this the environment of interest rates, regulation and reputation… VUCA squared.

Now where it says banking sector, let’s change the term. Let’s look at the world of work. Where the unemployment rates after the crisis have not returned to what they were; the new jobs are nothing like the old ones in terms of conditions; you don’t know if you have to look for a job in a company or offer yourself as a freelancer for several projects in several companies and where you can find people looking for a vertical professional career in horizontal companies or companies that ask for professionals with ten years of experience at the price of an intern and there are many willing to accept it. Volatile, uncertain, complex and ambiguous.
The world is so VUCA that we did not even know in 2016 the possible consequences of a pandemic. Where was this in our plan?

We could try many more sectors, but I really think that these two examples are enough to understand what a VUCA environment is. And as we can imagine, these environments have a strong impact on our daily lives. In the case of companies, I like the advice that my friend Eugenio Rámirez gives in his Blog to face these continuous changes and that I allow myself to summarize (you can tell me off and I’ll modify Eugenio):

  • Know your offer;
  • Know your competitors;
  • Study the market
  • Analyze global trends…
  • Act accordingly.

Regarding the impact it has on our daily personal lives, José Ignacio Azkue points out that “priorities, the things we should pay attention to, change much faster and with a frequency that overwhelms us” and that often catches us off guard and unprepared. We can only do one thing, accept change and continually adapt, as if we were water (“Be water, my friend” as Bruce Lee said in the ad). become liquid. But that… that’s another story.

And you? Do you live in a VUCA environment? Is it possible to live in stable environments today? Exist? Any time passed was better?

This article was first published in “Working that is a gerund” on October 19, 2016 and has been republished for n5now on February 24, 2021.

Share this article

Recent posts

Popular categories