Business

Stax Inc. approaches a world with increasing VUCA

Management consulting firm Stax Inc. breaks free from traditional methods of developing strategies, building its new approach on the framework of “Run & Reinvent”, the firm announced in a press release.

In a world that is increasingly more VUCA (Volatility, Uncertainty, Complexity, Ambiguity), outdated methods that involve long-term business plans leveraging data-driven insights and empirical research are put to test, the release added.

Stax Inc. builds its strategy on “Run & Reinvent”, which involves the collaboration with firms to develop strategies that optimise internal operations (Run) and make bold decisions to transform themselves to take charge of the future (Reinvent).

VUCA is an acronym used in terms of the unpredictability of life with the change of pace created by technology, big data, and other external shocks such as terrorism and natural disasters. Volatility is the speed of change in an industry. Industries and markets are more volatile when the rate of change is faster. Uncertainty is the level of predictability in today’s markets as well as a person’s ability to understand what happens around them. Complexity is the number of variables to consider when making business decisions. It also stems from interdependencies between those variables which make it harder to analyse business environments and make effective decisions. Ambiguity is the lack of clarity or information, which affects the ability to draw complete conclusions.

Stax Inc. Managing Director Ruwindu Pieris stated: “Highly volatile and complex business environments demand businesses to be more agile and have a built-in feedback mechanism during the implementation phase to respond to changing dynamics. This ensures the timely feedback between the organisation and the strategy in response to changes and external shocks in the market place.”

“Further, in VUCA environments, a few businesses tend to wait on the sidelines until they have better visibility. This inaction in times of turmoil and uncertainty can be perilous, as competitors with more agile business models can disrupt the industry and capture market shares from incumbents.”

He further remarked: “For Sri Lankan businesses, volatility and uncertainty have become an ever-present challenge with natural disasters, changes in the political landscape, and external shocks. With time, it is no surprise that companies within and outside Sri Lanka reach their downfall due to the inaction or poor decision-making in an industry and a marketplace that is rapidly changing.”