Leader decisions part 1: How good are Leaders’ VUCA skills?
Do today’s leaders have the skills required to make good decisions under conditions characterized by Volatility, Uncertainty, Complexity, & Ambiguity?
Building VUCA skills isn’t difficult, but it takes time. In an ideal world, we’d be building them our entire lives. Unfortunately, most formal education focuses on academic knowledge rather than real-world skill, so leaders are on their own when it comes to building decision-making skills — especially those required for working with complexity. Given these conditions, it should come as no surprise that most people in leadership roles do not exhibit optimal VUCA skills.
In earlier articles, I’ve discussed the complexity gap — the gap between the complexity of decision-making challenges and the complexity of leaders’ thinking, which my colleagues and I first documented in 2005. I’ve also described how the complexity gap can be narrowed with a combination of every-moment learning and VUCA skills. What I’ll focus on here is whether or not leaders’ current VUCA skills are strong enough to play a role in narrowing the complexity gap.
What are VUCA Skills?
VUCA skills are required for leadership decision-making under complexity. They include skills related to decision-making process, contextual thinking, perspective coordination, and collaborative capacity.
Decision-making process includes skills for identifying the source(s) of a problem, gathering and evaluating relevant information, setting decision-making goals, deciding upon and executing a decision-making process, and evaluating outcomes.
Contextual thinking includes skills for gathering information about the context in which a situation has arisen, identifying contextual causes, and coordinating immediate and contextual causes.
Perspective coordination includes skills for perspective taking and seeking, identifying relevant perspectives, and bringing perspectives into the decision-making process.
Collaborative capacity includes skills for bringing others into the decision-making process, determining how best to include others in a given decision-making process, and facilitating participatory decision-making processes.
My colleagues and I use a set of rubrics to measure the skill with which leaders employ these VUCA skills in their written responses to prompts in the Lectical Leadership Decision-Making Assessment (LDMA). Rubric scores run from 0% (no demonstration of skill) to 100% (mastery).
What have we learned so far?
We’ve learned that few of today’s leaders are VUCA virtuosos.
The following analysis examines the results of all scorable LDMA Assessments that have been coded with the current VUCA rubrics. VUCA scores were determined by Certified Lectical Analysts trained and employed by Lectica, Inc. The sample is composed of 2193 leaders representing dozens of organizations, businesses, and disciplines.
Let’s look first at the distributions of VUCA skills.
As you can see in the table below, the mean VUCA Scale scores for the 2193 leaders in our sample was 47% for perspective coordination, 36% for contextual thinking, 42% for decision-making process, and 37% for collaborative capacity.
The corresponding level descriptions for the mean scores shown above are as follows:
Perspective coordination—demonstrates the ability to use information about stakeholders’ beliefs or motivations to obtain agreement or buy-in.
Contextual thinking—demonstrates insight into the ways in which individuals or groups involved — explicitly or implicitly — in a complex problem situation may have contributed to its development.
Decision-making process—determines the best solution by learning more about the facts of a situation, then weighing or balancing alternatives.
Collaborative capacity—demonstrates skills for bringing others into the decision-making process as advisors.
The level of skill represented in these descriptions would be adequate in an environment in which (1) most decision-making situations involved individuals or small groups and (2) clear rules or guidelines could be applied. But most management positions in today’s organizations involve much greater complexity, multiple contextual causes, long time-horizons, rapidly changing conditions, marketplace volatility, hierarchically nested considerations, multiple types of stakeholders, the need to gather, evaluate, and coordinate input from multiple sources, and increasingly often, participatory decision-making.
The figure and table below show how VUCA skills scores relate to management level in the 1830 cases for which we have management level information. As you can see, there is a fairly clear trend of increasing scores from the supervisor to CEO level. (The not a manager category is problematic because it includes some individuals in high complexity non-leadership roles.)
However, the executive group does not appear to be doing much better than the senior level managers, except when it comes to perspective coordination, and even the CEOs perform in the 55%–60% range, well below the 90%–100% range that would serve them best. Moreover, although VUCA scores correlate positively with management level, these correlations are small. Clearly, there is a need for more active development of VUCA skills.
In general, higher leadership levels are more complex than lower levels. Executive roles require leaders who are complex, clear thinkers—and VUCA virtuosos. There is no magic bullet for creating these leaders, but there are practices and processes that can be embedded in the workplace (or classroom) to ensure that everyone involved has an opportunity to develop VUCA skills. The first set of practices relate to a model for learning optimally from everyday experience (VCoL+7). With skills for optimal every-moment learning in place, leaders can build VUCA skills efficiently and continuously, simply by doing their jobs (with occasional injections of useful information or tools).
In the social sciences, survey-style self-report assessments have increasingly become the standard form of assessment used in research. When I was conducting research for this article, I discovered that much research into decision-making skills takes this form. Survey-style research is popular because it is inexpensive and relatively easy to do. But it is also a poor way to examine skill, because all it can do is tell us about attitudes, perceptions, opinions, or feelings. It cannot tell us how skilled people are — for example, how well they make decisions. Beware of articles in which authors seem to be claiming to measure skill with surveys.