A mere 14 months ago, this article would have been focused on the Fourth Industrial Revolution and the rapid rate of change in certain industries due to the influence of technology and digitisation. We knew at the time that the shelf-life of skills was anywhere from 18 months to five years and that almost all industries were going to continue to see massive disruption, along with a vast need for re-skilling.
Fast forward to today and Covid has brought us, on average, seven years into the future with a scope of change that was nearly unimaginable just a year ago. In January 2020, optimistic industry estimates projected that it would take 453 days to implement remote work/collaboration infrastructure. Once covid struck, though, it was facilitated in 10 days – a 43x multiple of the estimate.
Many similar metrics have emerged since the beginning of Covid and they all demonstrate one thing: the rate of change we are experiencing is faster than at any point in history – and it is only accelerating. It does, though, beg the question: “Has Covid made us incompetent?” Are the skills and models of the past still relevant to our current reality?
We have moved from a world of understandable risk to unknowable uncertainty, and while many feel this change, they aren’t able to articulate the impact.
So, why is this change so profound? Because it gets to the very essence of our thinking, our assumptions and our strategies. It is fundamental to our organisational cultures and infrastructure. We have models to understand, measure and mitigate outcomes which are predictable. We think we know the parameters, players and possibilities but the new paradigm with the accelerated speed of change means our previous mindsets no longer apply.
Sidestepping surprise
Due to a combination of lack of frequency, predictability, executive awareness, resources, business imperative and cognitive bias, we repeatedly get caught by surprise, despite all evidence indicating that steady-state will never be “normal again”. Fortunately, the path to understanding, mitigating and measuring uncertainty is possible, but we have to change behaviour and assumptions to do it.
Developing good strategy and sound decision making in an uncertain and high-stakes environment requires a different process that includes objectivity, diversity, trust and transparency. This is a shift from the decision-making process in most organisations that is based on culture, personality, data, bureaucracy, fear, risk aversion and deadlines.
I know that many people will be offended by my characterisation of organisational processes, and are particularly offended by the use of data as a negative decision-making criterion. But take a moment and think: We are talking about future-facing decisions in an environment of uncertainty. What data do you really have? Most data represent lagging indicators of historical, knowable risks and is incomplete or inconclusive. Are they really useful in a truly uncertain situation?
What is particularly troubling to many is the fact that shorter-term decisions now have the same level of ambiguity as “longer” term due to the accelerated rate of change. The future, and the unknowns that come with it, are literally coming at us at a faster rate thereby creating greater uncertainty in daily activity vs. long-term strategic planning.
What the past can teach us
The financial crisis of 2008 was actually an excellent appetiser for the Covid crisis we are experiencing now. In 2008, the platform players AirBnB and Uber disrupted two of the most established markets in the world, industries previously thought to be impenetrable in many ways. Prior to that, arena (non-industry platform providers) vs industry players were not even considered in the strategic planning.
Now in 2021 we can look back and see that demand for oil can go down, people can work from home en masse, demand for the type and location of real estate can change rapidly, lean doesn’t equal resilient and the global supply chain can be disrupted. What else needs to happen for us to believe that uncertainty is the status quo and change accordingly?
In the soon to be released book Intelligent Analysis by Grusin and Lindo talk about the idea that “Organisations which are best able to transform complex information into actionable intelligence win every time.” This is not a new idea, but the tools to do it must be.
Using the risk spectrum, “debiasing” decisions, leveraging expertise and diverse mindsets in new ways, and mitigating organisational silence are all some of the practical tools that turn the fear of uncertainty into a strategic asset.
Solveig Nicklos is an expert in operational start-up, turn-around and on-going management with a specialty in organisational culture and performance.
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