The Key Problem with Uncertainty-People Just Don’t like It

5 May

Managing uncertainty is becoming a higher and higher priority for businesses around the world. It’s very easy to see why-political, economic and social instability is everywhere and highly unlikely to end in the medium future at least. Making decisions, plans and strategies which have any chance of a positive outcome is harder than ever. Because it is harder, businesses now want to focus more on managing uncertainty effectively, and are consequently looking for methods to improve this ability. However, putting aside the geo-political situation, and all the socio-economic threats, the real problem is that human beings just don’t like facing up to uncertainty-and that is the biggest threat to effectively operating a business over the next 5-10 years.

The UK are days away from a General Election. All the major and minor parties seem to be focused on creating retail deals with voters-you vote for me, you get this in return. This is politics, but this focus has meant the world outside the UK has been largely ignored. The focus is entirely on domestic policy. I read a theory why in one of the UK broadsheets-every time a focus group is asked about global and economic uncertainty it makes them anxious, the focus group simply doesn’t want to acknowledge it. So, the events which will define the world, business, and individuals on the global level over the next few years are simply being ignored. The entire election is based on promises and perceptions of stability-stability over business performance, stability of income, stability of prices, stability to pay the mortgage. If this stability doesn’t exist, if it is replaced by uncertainty, then the very fabric people’s lives are perceived to be unravelling.

This drive toward stability and with it smooth, linear solutions, plans and strategies means acknowledging and managing uncertainty gets shut out. A quote from Karl Weick and Kathleen Sutcliffe’s (2007) Managing the Unexpected illustrates the default business position when faced with an interruption in stability; after an unexpected event breaks stability, learning takes place, the chaos, and how it was dealt with, provides clear lessons on the flaws and limits in current processes, and also the corresponding thinking strategies used to cope when events are stable. However

“…it won’t be long before candour gives way to moments of normalizing that protect reputations, decisions, and styles of management. As soon as the official stories get “straightened out” and repeated, learning stops”. (Weick and Sutcliffe, 2007, p. 109).

Stability and “getting back to normal” are very comforting. However, they shut out the lessons people learn and the skills they develop to manage unexpected events. So, if these skills are so valuable and becoming increasingly necessary, why do businesses and people shut them out, even at their own detriment? Human beings are pattern recognition machines (see Kahneman, 2011), a person sees a complex mass of information and is driven to find some pattern in it, and some narrative or plausible story that integrates what is being seen and experienced into what we know already. This drive can sometimes work well for us in environments which are reliable when it comes to making sense of cues and patterns (aspects of clinical reasoning and firefighting, see Weick, 2009) but can work against us when we attempt to make sense of unreliable environments such as what other human beings are about to do next. The drive produces social constructs like stereotyping and mistaking a run of luck for skill, both of which leave people floundering and confused when they become contradicted. This psychological drive explains why the new becomes frequently rejected, innovation can be viewed as just “disruptive” and change is viewed as a threat-they simply don’t fit within the current method of making sense of events. To this end, stability is seen as the normal pattern, uncertainty viewed as a threat; to alleviate the psychological discomfort this threat causes, it gets explained away, absorbed within the pattern of stability. Most significantly, uncertainty becomes something which is ok to ignore. When eventually uncertainty can no longer be ignored, far fewer people than necessary have the skills and resilience to cope effectively.

A method of addressing the above is to draw lessons from “reverse domains” where uncertainty is the norm, and any attempt to impose stability could be fatal. These include some clinical environments where initial diagnosis need to kept flexible, firefighting where conditions such as wind direction might suddenly change and so the situation changes rapidly, and alpine skiing where threats such as avalanches have so few cues extreme caution and focus on discrete changes is essential to survival. These domains provide techniques for assessing the external environment in a “critical” way, because in a “reverse domain”, when stability is encountered the alarm bells start ringing. How to explore and develop these techniques for business I’ll discuss in a future blog.

Reading.
Weick, K. & Sutcliffe, K. (2007) Managing the Unexpected. Jossey- Bass (Wiley Imprint)
Weick, K. (2009) Making Sense of the Organisation: The Impermanent Organization. Voume Two. Wiley
Kahneman, D. (2011) Thinking Fast and Slow. Penguin.

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