In this month’s article we take a look at some action items that
can help you deal with uncertainty
Brainstorm
Develop a comprehensive and broad list of the ways the uncertainty
you are facing will influence your industry and competition.
Some points might include changes in supply/demand;
competitors’ strategic actions; technology; regulations; and the
development of substitute products. Consider the chronological
order in which the uncertainties are likely to be resolved.
Identify Possible Courses of
Actions and Their Interrelationships
Remember, in this and the above step, possible decisions and
uncertainties should not be pre-judged when presented or offered.
The point of identifying the possible action steps is to see how
these interrelated processes might develop and how you might
influence them, rather than trying to take each and every decision
to its ultimate point. As part of this, identify which action
steps put the company most at risk, those the company can most
likely influence and, finally, new aspects or approaches that might
minimize or mitigate the risks faced.
New vs. Conventional
Develop new visions and scenarios. This will help focus the
analysis of the uncertainties onto the competitive environment,
will take you beyond conventional forecasting and will enable
you to develop reasonable yet alternative views of the future.
Avoid the “best case—worst case” approach. This approach often
causes one to focus on the “most likely” and, as a result, the resultant
strategy really rests on the “most likely” and the delusion
that the uncertainties have been addressed.
How Can You Change The Future?
Are there moves you can make or signals you can send that might
bring about pivotal events you desire? Can you beat the competition
to the punch? Can you have an impact on laws or regulations?
Will you awaken a sleeping giant? Can you build an
insurmountable lead by moving now!
One Size Does Not Fit All
There is likely not just one response to uncertainty for your entire
company. Too often the approach to uncertainty is that there is
only one possible choice. Different departments or units may be
affected differently by the same uncertainty Look at your company
as a group of units each of which might, and possibly should,
develop its own responses. You might tolerate a greater level of
risk in one area to minimize the risk in another.
Stop, Step Back, Take a Look
If your company’s response is the same regardless of the various
uncertainties, stop, step back and take a look. Either the uncertainty
is not critical and the company should move on, or the
uncertainty has been mischaracterized and needs more analysis.
Following these steps may take you out of your comfort zone,
but they may guide you into making better assumptions and
developing better responses and plans for the future.
(For more detailed reading on this topic, see “Strategic Response to
Uncertainty, “Elizabeth O. Teisberg, Harvard Business School
Publication 9-391-192.)
About the Author
L. Douglas Mault is president of the Executive Advisory Institute,
Yakima, Wash.
