VUCA Environment
VUCA, an acronym, stands for volatility, uncertainty, complexity and ambiguity. It is a combination of
qualities that taken together characterize the nature of some difficult conditions and situations.
This concept was introduced by the US Army War College to describe the conditions resulting from
the War. Unsurprisingly, business in the 21st century is like warfare. The world we live in is of fast
change and information overload, technology changing the world at a lightning pace. The
environment in which the companies and authorities have to operate, changes at the same speed. As
a result, the companies have to adapt their products and services continuously. Basically VUCA
conflates four distinct types of challenges in the external business environment that demand four
distinct types of responses.
The business environment created by COVID-19 pandemic is a VUCA environment. For example let’s
take an international footwear business, producing all kinds of shoes, socks, shoe-care products.
With the pandemic and the lockdowns of countries that followed world-wide, the use of footwear
reduced considerably. Need of new footwear decreased. With the social distancing policies that
followed, the social events were reduced too and the use of party wear, fancy wear reduced. With
the education being mainly through online platforms, the use of footwear from school shoes to all
other informal wear used by university students decreased considerably. Likewise with the customer
need for footwear decreasing, the company sales and profits are reduced. According the company
have to adjust (reduce) their productions and all other processes in order to not create an unwanted
surplus. This decrease in profits will affect the human resource management of the company as well.
There will be instances where the company will find an excess of employees and some will be forced
to resign. Some branches of the company will have to be closed to prevent losses.
Once when the lockdowns due to the pandemic are over, and people gradually start getting back to
their usual day-to-day routines, the company will have gradually undo the changes they made to
survive the lockdown period. As after-effects of the pandemic, certain changes like lesser social
interactions will be in place. The company should also be adapting to such changes while trying to
restore the changes done to adapt to the pandemic.