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Ricardo (4s): Hello, everyone. Welcome to the five minutes PM podcast. Recently, I published an article talking about smaller companies and large companies and the advantage of the smaller companies to move faster, to innovate, and to change their strategic direction much faster than large companies. And in the center of that article, I put the concept of VUCA, V U C A, Volatility Uncertainty Complexity, and Ambiguity. And this is not a new concept. This was developed in the late '80s. So around 30 years ago. In most to address military development is exactly the environment where you have much less predictability and in a much more complex environment.
Ricardo (54s): So I'd want to discuss why we should care about, about VUCA or V U C A. First, most of the systems today, I am talking from governments to organizations, they are not set up for VUCA, complex operations, complex projects. They need to embed the concept of volatility, uncertainty, complexity, and ambiguity, inside, their project planning their project execution in order to address this. So let's talk a little bit more about each of these letters. The first one the V, Volatility.
Ricardo (1m 35s): What is a Volatility? Volatile is something that changed rapidly and unpredictably. So what I'm telling here is that if you have something that is volatile means it's something that changes extremely fast and it changes into an unpredictable way. So, you know, it will change fast and you have no clue of how it will change. So you just know that you prepare for something and it changes, and then you prepare for something. And it changes again, in most of the organizations at traditional organizations, the first thing they do with that Volatile environment is to resist. And resistance does not work because if you resist, the Volatility will happen in your way.
Ricardo (2m 19s): And at some point, you can just break everything. This second aspect is uncertainty. Uncertainty is your lack of ability to know exactly how the results will be. It is to have some kind of predictability. So I'm spending this amount of money on this part of the project. And I want to know for sure that this will have a payback of X, years, or X months. Most of the time you have no certainty because the amount of data is so large and the relationships are so nonlinear that the future just emerges.
Ricardo (2m 59s): Let me explain why some project managers and some engineers like myself, love mathematics because one of the biggest advantages of mathematics is predictability. If you add one plus one or two, it's two, technically speaking. But when you have Uncertainty, it means you add one plus one then, the result is zero, sometimes it's ten, sometimes it's minus 20. And this Uncertainty brings you at a very strong tension because you don't know that traditional cause and effect relationship you do this, and it grows this way. So sometimes you do that and it grows in a completely different way.
Ricardo (3m 42s): So top companies, what do they do? They create an environment that the future emerges and your ability to handle. So you prepare people to embrace things that they do not expect and just move that way. So you have some estimation of direction, and then you just go and test. So you don't become a rigid or a risk averse. You just embrace that future that may emerge. And you adapt yourself. The third aspect is complexity. Complexity is due to many parts that are interconnected, an interdependent. Let's go back to our engineering class.
Ricardo (4m 24s): If you remember physics, if you remember chemistry, you always remember that is that concept of N T P normal temperature and pressure. So means normal conditions. What is that? It's a kind of simplification. So you remove all the variations of temperature and pressure to simplify the formula and to simplify your analysis of the Environment. Do you remember gravity? When we talk about gravity many times. What do we say? We say, Oh, please disregard the air resistance. But in real life, there is no way, unless you were in the vacuum, but in normal conditions, every time you throw ball from a fifth-floor building, you cannot disregard the air resistance.
Ricardo (5m 14s): So Complexity, it's exactly that. Today for example, in large organizations, when you do a move, a strategic move, you need to understand that maybe that move will affect the whole ecosystem where your organization is In. So you need again, to understand that the best ability you need to have as a project manager, or as a business leader, it's your ability to create an environment where you can handle situations that may emerge in such an unpredictable way. And last, but definitely not least It's a human behavior.
Ricardo (5m 54s): It's the concept of Ambiguity. And what is Ambiguity it's, when you can have more than one interpretation for the same data and the best way to see this it, if you watch some news or read some news on the newspaper or watch on TV, you may have two people that will interpret the same news in different ways. And sometimes in opposite ways. Why? Because of the Volatility, because of their Uncertainty, because of the Complexity, we don't have a model that can fit that. And many times our models do not represent that new scenario. You try to use because your brain always tried to build shortcuts to decisions.
Ricardo (6m 38s): So you get an idea and you have your initial feeling, but still sometimes because of this Volatility Uncertainty and Complexity, this Ambiguity will create a massive challenge for you. And I want just to use this, I have no judgment on that, but do you remember what happened with a Nike advertisement recently? Nike used a player that refused to stand up in the US the national Anthem and Nike used that you need to be brave to follow your instincts or your decisions. And what happened? The advertisement was basically the same.
Ricardo (7m 17s): Some people supported it found it nice and bought more Nike products, other people just hate it. They said that this is a betrayal of US, and they just burned their sneakers and this. So this is an Ambiguity. This is something when you create an ad that generates some polemic and ambiguity. And in many times, the Ambiguity can be in yourself, not to different players. You may arise with two different feelings being the same person. So you don't know what is the best way. So the concept of VUCA, it's exactly this Environment.
Ricardo (7m 58s): And why I'm telling you this as a project manager? Because this is a critical, and this is what allowed the arise of a agile methods. this is why we talk a lot about rolling wave planning, and even on the VUCA, it's on the Complexity of the working relations today. So imagine your job or your role. It's much less predictable, it's much more volatile. It, it has much more interconnections and you feel the Ambiguity all the time. So this is something that we need to understand and embrace because you cannot go against, you cannot oversimplify your projects.
Ricardo (8m 38s): This is why so many projects fail because people try to use a systemic approach to something that is not systematic. And this is why, for example, the PMBOK published the agile guide and this is why we are talking. And then of course I'm saying, being agile does not mean do nothing, no planning. You can create conditions and adapt to these conditions as they emerge. There're so many outstanding videos on YouTube about that, but you need to be aware of this. And this is why some startups are much faster because they were built with this concept from the beginning, while traditional companies were built in a very different mental model in the past, that does not respond to the challenges we face today.
Ricardo (9m 27s): Think about that. And I hope to see you again next week with another five minutes PM Podcast.
