The new business cycle embracing uncertainty
Firms following the mass-industrial logic have given us remarkable material well-being over the last few centuries, but are increasingly being criticized for not being suited to handling the needs of today. Firms need to excel at innovating a post-fossil future. Companies need to meet new demands for constant change, and need to embrace uncertainty in ways that we have not been used to.
The industrial approach to management places a heavy emphasis on the formulation of plans and intentions and then communicating them as actions to be executed by the organization. The belief is that managers can make useful forecasts and set goals. Their daily responsibility is then to monitor activities to identify gaps between the goals and actual outcomes so that the gaps can be closed. Uncertainty plays a minor role. Managers are supposed to know what is going on.
Every business is a set of assumptions that are taken as given, thus reducing the perceived uncertainty and psychological anxiety. The whole plan-execute cycle is a process designed to prove assumptions correct. The closer you are to the budget, the better it is. But assumptions are never totally right and, often not totally wrong either. Accordingly, it is quite seldom that ideas are turned into a successful business in just the way described in the business plan. Things change.
In conditions of rapid technological change and ecological uncertainty, there has to be a systematic process indicating new opportunities as they emerge. What new possibilities have become visible that make or our present assumptions, or the way we do things, outdated?
It is about asking questions, testing the assumptions continuously, and signaling which are still helpful and which are not. The new business cycle is a learning process designed to prove assumptions wrong, not right!
The plan-execute cycle turns into a question-answer cycle: “What is the problem we try to solve?” “ What approaches and technologies do we use, or could use, to solve it?” “How can more people participate in this inquiry and learning in such a way that things continuously develop and change to the better over time?”
The strategic focus is an ongoing movement that is open-ended, and always incomplete. The strategic logic is temporal rather than spatial. When following a spatial metaphor, there is a territory that can be explored and understood, but here the territory is seen as being under continuous development and formation through the exploration itself.
The new, entrepreneurial experience of work is very different from the mass-industrial experience. It is about acting into the unknown, not necessarily working towards a known goal. It is more about improvising together than creating and following a script. It is more about emergence than rational causality. It is more about sciences of complexity than systems thinking.
The idea of improvisation is often associated with notions of unrehearsed, unintentional action. However, the more skilled the players are, the better they can embrace uncertainty. The better people have planned, the more flexible they can be. The more people are present for each other, the more reflexive and responsive they can be as individuals.
The most important outcome is that we can focus attention on what is really happening, what we are learning in the present, rather than on what we intend to do in the future. The best way to be future-proof is to be more responsively present today.
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