Recently, the subject of coping with prolonged uncertainty has surfaced during numerous executive coaching sessions. Traditionally, uncertainty is defined by a period of unpredictability or risk and is highly influenced by depth and time. Currently. we are experiencing both as we move through this first month of 2021.
However, given the concept of uncertainty is so big, we need to break it down into three workable distinctions. The first is market uncertainty which reflects what is happening within the market. This is sometimes called demand uncertainty. The question here is the following: are we still offering the right goods and services which meet the changing needs of our customers? On a side bar and related issue, leaders are also questioning whether or not our information sources about what is happening within the market are still the right ones to be paying attention to at this time period.
The second is capacity uncertainty which reflects what is happening within the company. Here the critical question is the following: do our internal operations have the capacity to meet the changing needs of the market and the customers and still be competitive at the same time? At this point, we need to think about organizational capabilities, i.e. the collective ability of the firm. The key questions related to capacity uncertainty are two fold: What does success look like when the market dynamics are continually shifting due to COVID? Do our historic, analog metrics around individual and group performance capture the shift to digital platforms?
The third is leadership uncertainty which reflects whether or not people in leadership positions have the correct mindset and individual competencies to deal with market uncertainty and capacity uncertainty. In simple terms, the question here is the following: do we have people in leadership positions who have the capacity to plan and the capacity to execute that plan given the degree of uncertainty in the market and the organization’s capacity?
Our typical response to uncertainty is to go into self-protection mode. We focus on our worst fears and insecurities. Brene Brown in her excellent book, Braving The Wilderness: The Quest for True Belonging and the Courage to Stand Alone (Random House, 2017) defines these fears as the following: “Fear of vulnerability. Fear of getting hurt. Fear of the pain of disconnection. Fear of criticism and failure. Fear of conflict. Fear of not measuring up.”
The natural outcome of these fears is to silo up within an organization. It is normal for people to want to protect a division, department or team from chaos, disequilibrium or the loss of resources. We also hunker down and focus on protecting ourself. This translates into focusing on getting our work done and keeping off of everyone’s radar screen.
However, from a leadership perspective, the desired response to uncertainty is greater horizontal collaboration within the company. We recognize that creating and maintaining partnerships and collaboration is mission critical to resilience.
To make that happen, the first step is to build clarity and to build understanding. What we have to recognize as leaders is that more and more people have lost a sense of clarity. From my perspective, they are clear about the following: why the organization exists, which behavioral values are fundamental, what specific business it is in, who its competitors are, and how the company is unique.
What they are not clear about is the following: what is the plan? And who is responsible for what? This is a loss of strategic clarity that is playing out in operational choices. The outcome of not being clear with these two questions is that more people feel overwhelmed and the organization feels like it is drifting. Therefore, the natural outcome is that more and more people are asking the question: Why are we doing what we are doing?
When I step back and look at this issue and the current reality emerging in 2021, I have one big insight, namely the amount of time and energy needed to create clarity about strategy within a company is an order of magnitude greater than the time and energy it takes to create strategy.
This week, unpack the concept of uncertainty with your team and then focus on making sure everyone on your team knows what is the strategic plan for the next three years and the related 2021 operational plan. Next, make sure to clarify what part they are responsible for during the next 12 months. Creating clarity is the daily work of leaders and it does not happen in a day.
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