Navigating in challenging times
December 01, 2020
If you have read around business as a subject you will probably have heard the term VUCA before, and quite possibly you will have heard this anyway in the last 12 months, as it is certainly relevant to our current environment. The term originates from the military and has been in use since the late 1980s; so, whilst it is not new it provides a framework to describe and to reflect on a dynamic and rapidly changing environment, specifically:
V Volatile
U Uncertain
C Complex
A Ambiguous
Does this sound familiar? 2020 has certainly given us some memorable examples of each of these, and it is undeniable that the future will continue to be disrupted, whether those challenges and change drivers are economic, medical, environmental, or legislative.
- Volatile – at the beginning of February, we were preparing ourselves for a good season; at the beginning of March, we were starting to feel concerned about a short-term impact to our business which might affect Easter; by the beginning of April we had been forced to make large-scale furloughs across all businesses, and looking at the prospect of 3 months with all our customers closed, and no sales revenue. In less than 10 weeks our world had changed. This is volatile.
- Uncertain – as we look forward into next year, we are still unsure of the roll-out speed and efficacy of the various vaccines currently in development. We must also go through an exit from a stable trading union of which we have been a member since the early 1970s. Currency, passage of goods, tariffs, on top of the ongoing threat of further lockdowns. On top of the normal challenges in business. This is uncertain.
- Complex – if we consider our market alone, the leisure industry, we can see the challenges with forecasting into 2021. On the positive, we have seen record sales in the months in which we were able to trade normally. But was this due to backed-up demand, or new customers, and will they return to do the same next year or choose to fly overseas instead? Will people be able to fly easily and cheaply as before? If they stay, can the UK holiday resorts and parks accommodate the concentrated 6-week demand in a normal school-holiday year? And if demand increases…will the UK then become too expensive and drive people back to overseas holidays? And so we continue….and this is just focusing on one aspect of one industry in one country. Try to scale this up to include our customers and global suppliers…..this is complex.
- Ambiguous – as a general trend not specific only to our industry, we are seeing challenges and changes to the traditional supply chain. Suppliers want to retail directly to the end customer, retailers need to add value with service in order to survive, distributors are delivering directly to the retailers’ customers, and the end customers are not fitting into our traditional demographic pigeon-holes any more by age, race, behaviour or gender. Our conventional models and structures are being challenged, disrupted, and replaced. Welcome to ambiguous.
This can leave us feeling a little overwhelmed as employees, managers, and business leaders, and this is where we need perspective and a support framework. However, it is all very well having a handy business acronym…the question is “how can we translate this into something useful?”
Responding to a VUCA world
We must prepare ourselves to respond to this environment and challenge ourselves - is there a yin to the VUCA yang that can help us? It should not be a surprise that there have already been many suggestions on how to respond to the reality of future disruption, volatility, and change. This is a good basis although I find the terms a little broad and strategic to translate in action for many people.
I want to relate this to our organisation, and the leisure industry and then to expand on how we translate this into our daily behaviour and thinking.
Building a ROCK-solid business
As we come to the end of 2020, it is a good time to reflect on the last 12 months, what we have learnt, what went well….and not so well. I have aimed to distil this into a summary which challenges us to think about our behaviours, and how we can proactively help ourselves adapt to a changing environment.
No apologies here for another 4-letter acronym – we can use this tool to check ourselves against each of these areas.
As a business, and as individuals, the counter to a VUCA world is to be:
R Responsive
O Outward-Looking
C Collaborative
K Knowledgeable
- Responsive – this can be summarised as our flexibility, speed, and adaptability to change. As a business, are we able to cope with a surge in demand of 30%, or the opposite? In both cases, we need to ensure we have modelled what this looks like. As individuals, we have learnt to use new digital tools, worked in different environments, taken on new jobs and changed our working hours and commuting patterns. We need to build a new routine with this in mind and be open to change and learning.
- Outward-Looking – it is easy to get caught up in the micro-detail of our work and forget to look outside of our daily routine. This is not a job reserved only for managers in the business – it is everyone’s job. Our colleagues are the eyes and ears of the business, and we can get direct feedback about our industry (and the general mood of the nation) from newspapers, digital, neighbours and friends, market reports, competitors, suppliers and customers – this can be useful when reported back into the business, and also helps us have perspective as individuals. If we know more about the short-term future, we will feel more secure about the journey, and more able to support our colleagues.
- Collaborative – we have seen some great examples of the importance of this across all areas of the Arleigh business this year and linking into colleagues across the European Group during 2020. We have seen cross-functional teams working to solve challenges in many areas including Warehousing & Logistics, Health & Safety, Human Resources, IT and Communication. We also set up our branches and home-working environments so that we could quickly re-deploy our workforce to adjust to the Covid restrictions. We have met and worked with new colleagues as a result, and this brings us closer together as a business and as individuals. Where conditions are volatile and uncertain, collaboration is key.
- Knowledgeable – we are the experts in what we do. Regardless of the area of the business in which we work, if we know our area inside-out, we can save cost and time when responding volatility. Knowledge gives us this edge over our competitors. Our knowledge of the industry enables us to identify the likely outcomes of environmental, economic, and legislative changes and to shape our business from the inside to suit. Knowledge of our customers drives our development to meet their changing needs – products, buying preferences, digital platforms, customer service and support.
If we apply this to build ourselves a solid framework, we are far more able to deal with a VUCA environment.
It has been a challenging year, without any doubt. However, one of the great paradoxes of being human is that we seek and often crave stability, and yet recognise that our most memorable and often most rewarding moments come during the times of greatest challenge and change.
Take for example parenthood, learning a new skill, sporting challenges, foreign adventure, family or friends in crisis and other tests and obstacles we have encountered – what did we take away from each of these experiences, and were we then able to help others in the future as a result?
If we come to recognise that uncertainty and change in business and in life can result in learning and benefit, then it ceases to become something we fear but something rather that we accept and manage. Nobody would have wished for this last 12 months, and all the hardship and difficulty it has brought to so many.
However, we can also recognise that through these difficult times we have been reminded of the importance of living our lives to the full, and continuing to learn, adapt and change.
Through this experience we will develop a ROCK-solid business, one that makes us better prepared for the journey ahead.
Adam Ramsden
Group Managing Director
