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  • 08.03.11

Nothing Is Certain But Uncertainty; Here’s How To Manage It In Your Business

Uncertainty–whether it’s about the economy, how to get from point A to point B on a project, or sales projections, among other things–it the unarticulated underpinning of many a failed strategy. But by being honest, communicative, and totally transparent, you can learn to manage uncertainty in your projects.

I was visiting with longtime friend and colleague Ron Evans of the Hybrid
Group
on a recent trip to Los Angeles. Evans runs a small shop of dedicated
developers out of Coloft, a coworking space located in tech trendy Santa
Monica, Calif. Although the Hybrid Group bills themselves as
developer guns-for-hire with a particular penchant for start-ups, Ruby on Rails, and cloud computing, they recently realized their own tools could add value to
others, so they started building products. They also realized that products
were a path to scalable revenue, and perhaps acquisition.

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When discussing Hybrid Group’s latest project, Kanban Pad, a project-management tool, Evans
made a comment that prompted this post. He said, “You need to worry about
what you are doing right now. These days, you can’t know what will happen next
week. Everything is uncertain.”

That statement echoed solidly, eventually achieving an eerie
resonance with debt ceiling battle that recently ended in Washington.
As a scenario planner, I express my concern about uncertainty all of
the time. I find it the unarticulated underpinning of many a failed strategy.
Arrogance or ignorance often substitute for truth as individuals, and
eventually the organizations they work for assign value to an attribute of the
future for which no meaningful forecast could exist. But when I say
“everything is uncertain,” I am usually talking about large events,
some that may be somewhat near term, but most which exist on the scale of years, if not
decades: economics, demographics, and the politics of China are common examples.

Although I have rarely seen a project plan of any complexity that actually reflects its eventual execution profile, most project plans end up being presented as correct. And for program managers, as for futurists, “they are never wrong today.”

What Evans proposes is a more honest approach: Just tell people you
don’t know what is going to happen next week. That is different from telling
people you don’t know what you intend to do next week. It is fine to share
intent, but that intent needs to be couched with uncertainty–and those using
this thinking process should not be vague, but precise. They should say what
they are uncertain about.

Years ago, I worked on a Product Data Management system for a large
aerospace firm. Part of the project was to create a complete lifecycle
management system with workflows that started the first moment a procurement
officer or anyone else started a conversation about a potential contract. They
wanted to track everything in precise detail, all the way through custom
engineering. And customer engineering proved to be the Achilles’ heel of the
project. We could model the acquisition and negotiation part of a contract. We
could model the delivery of a program. What we couldn’t model was the work
required to create the system, regardless of if it was hardware or software.
Why? Because we weren’t exactly sure how to make what the customer was asking
for. We had uncertainty. The workflow failed the minute the level of
abstraction went to something like “design ASIC,” or Application Specific
Integrated Circuit. Our engineers knew how to design an ASIC, they just didn’t
know how to design this ASIC.

In short, here is how you tackle uncertainty: First, admit what you don’t know. Plan what
you can, and keep diligent track of what you are doing so everybody is in the
loop, including documenting new uncertainties and any necessary adjustments to tasks or
time. In other words, keep it simple, but overcommunicate. 

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Evans has taken to heart the root of the idea of kanban, which
translated roughly from the Japanese, means “signboard.” Kanban as an idea stretches back into the mid-century history of Japanese auto manufacturing, eventually influencing just-in-time techniques and integrating with ERP.

Evans doesn’t so much believe in managing uncertainty, as much as
he believes in avoiding it. If you break the world down into consumable chunks
over the right timeframes, then uncertainty becomes a recognized specter just
out of sight, not an overwhelming shadow that transforms execution into
intransigence.

Strategists don’t always have the luxury of breaking their problems
into neat stacks of time, but they do have the ability, and I would say,
obligation, to recognize uncertainty and actively engage it so that operations
and future plans can adapt to the inevitability of change. Only fools believe
their own predictions. Good managers know they are usually wrong and are always
looking for ways to be right more often.    

[Image: Flickr user gato-gato-gato]

About the author

Daniel W. Rasmus, the author of Listening to the Future, is a strategist who helps clients put their future in context.

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