Managing uncertainty strategically

Some people are naturally more comfortable taking risks than others, and this diversity proves useful to the organization. Indeed, for obvious reasons, no one would want it to be made up solely of risk-takers, or conversely, of those who are risk-averse.

However, making a decision in a context of uncertainty does not mean closing your eyes and hoping for the best. You can adopt certain strategic measures to maneuver optimally without resorting to a crystal ball.

Making a Decision in an Uncertain Context

It might be tempting to wait for more precise information before making a decision because a wrong decision could unfavorably impact the achievement of goals. However, delaying a decision too long leads the organization to a deadlock. The lack of direction immobilizes it, preventing progress; not to mention that, in many cases, the only way to assess the correctness of a decision is to implement it.

Uncertainty can stem from numerous sources; here are some examples:

• Uncertainty about the probability of success of a decision

• Uncertainty about the actual value of a decision

• Uncertainty about the implementation of a decision

• Uncertainty about the repercussions of a decision

• Uncertainty about the risks and stakes that could materialize

Therefore, the success of your decision largely depends on your ability to discerningly identify sources of uncertainty and manage them.

A Strategist’s Stance

Managing uncertainty is a process that begins as soon as a decision is made and ends when its implementation is completed.

Adopting the stance of an objective observer who lucidly identifies the possible repercussions of a decision and the risks that could hinder its success is appropriate. Thus enlightened, you will be able to be proactive by taking the necessary preventive measures, thereby substantially improving your probabilities of success.

The first step is to identify the possible consequences of the decision you are considering.

• Which stakeholders are affected (directly or indirectly) by your decision?
  
  
  • Your employees, or some of them? Which ones?
  • Your clients, or a portion of them? Which ones?
  • Your business partners, or some of them? Which ones?
    
    
• For each of these stakeholders:
  
  
  • What repercussions will your decision have? Describe them.
  • What is the scope of this impact? Is it low, medium, or high?
  • What could you do to mitigate the impact if it is medium or high?
  • What do you decide to do about it?
    
    
• Similarly:
  
  
  • What processes are affected (directly or indirectly) by your decision?
    
    
• For each of these processes:
  
  
  • What is the potential impact of your decision? Describe it.
  • What is the scope of this impact? Is it low, medium, or high?
  • What could you do to lessen the impact if it is medium or high?
  • What do you decide to do about it?
    
    
• What is the financial impact of your decision?
  
  
  • What is the scope of this impact? Is it low, medium, or high?
  • What could you do to reduce the impact if it is medium or high?
  • What do you decide to do about it?

Then, assess the risks that could prevent your decision from bearing fruit.

• What could happen that might harm the success of your decision? These are risks.
  
  
• For each of these risks:
  
  
  • What do you think is the likelihood of this risk materializing? Is it low, medium, or high?
  • If the risk materializes, what would be the scope of its impact? Is it low, medium, or high?
  • What preventive measures would be beneficial to implement to reduce the likelihood of the risk occurring, or to reduce its impact if it does occur?
  • What do you decide to do about it?

You might invite different people and various experts to participate in your deliberation. Indeed, alone with your thoughts, you run the risk of being guided by your biases and personal preferences. Thus, if you are intuitively convinced of the validity of your decision, it is possible that you unintentionally close your eyes to negative repercussions and risks that could affect its potential for success. Inviting others to exchange with you is a way to broaden your horizons and adopt a systemic perspective of the situation.

Once your initial analyses of repercussions and risks are established, you will have the tools necessary to critically look at the implementation of your decision and adjust as needed.

A regular review of progress and a frequent update of the analysis of repercussions and risks will allow you to think strategically, considering the forest rather than the tree.

You will then be able to intervene proactively, which can only increase the probabilities of success for your decision.

Recognizing a Bad Decision

The best decision made at a specific moment can turn out to be bad after some time. The challenge lies in the ability to find the tipping point between perseverance and stubbornness. Cutting off bad decisions requires courage and clarity; on the other hand, persisting unnecessarily leads to a waste of energy and resources, both human and financial, which could be invested elsewhere.

Thinking strategically takes time and requires effort. However, this is an essential condition for your success and that of your organization.