Facing Down VUCA, and
Doing the Right Thing
Volatility,
uncertainty,
complexity and
ambiguity can
block the path
to the right
thing to do.
HOW DO IT LEADERS deal with unpredictable demand, increasing expectations, constantly changing technologies, escalating compli- ance requirements and fixed budgets? They need to accept and manage VUCA.
John D. Halamka
is CIO at CareGroup
Healthcare System, CIO
and associate dean for
educational technology at
Harvard Medical School,
chairman of the New
England Health Electronic
Data Interchange Network,
chairman of the national
Healthcare Information
Technology Standards
Panel and a practicing
emergency physician. You
can contact him at
jhalamka@caregroup.
harvard.edu.
You probably know VUCA even if you don’t
know the acronym. It stands for volatility, uncertainty, complexity and ambiguity. It arose in a military context in the 1990s, when VUCA might have
been used in reference to Somalia, for example.
More recently, it’s been applied to organizational
leadership by several authors, most notably Bob Jo-hansen, former CEO of the Institute of the Future.
Johansen’s take on VUCA is that it will only
get worse. But its presence creates both risk and
opportunity, he says, and strong leaders are able
to redefine the acronym by turning volatility into
vision, uncertainty into understanding, complexity into clarity, and ambiguity into agility.
One of his more interesting observations is
that VUCA has tremendous implications for
“commons building,” which you may know better
as “coopetition,” or cooperative competition.
My experience is in healthcare IT, so let me
give you an example of commons building from
that field. Fifteen percent of the lab and radiology
tests done in eastern Massachusetts are redun-
dant or unnecessary. Ensuring that all test results
are available electronically among all providers
(especially competing organizations) will require
millions of dollars for implementing electronic
health record (EHR) systems, health informa-
tion exchanges and interfaces. Thus, we’ll have
to spend money for a system that will reduce our
incomes, since the goal is for healthcare provid-
ers to administer fewer tests overall. It’s the right
thing to do, but VUCA can block the path to the
right thing. In this case, the medical IT commons
will be at odds with individual providers’ incen-
tives in a fee-for-service world. So how do you
neutralize VUCA? You change the incentives and
pay individual providers for care coordination, not
for ordering more tests.
