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VUCA- The managerial acronym for Volatility, Uncertainty, Complexity & Ambiguity

A managerial acronym that is becoming increasingly trendy: VUCA. It stands for Volatility, Uncertainty, Complexity, and Ambiguity, and is a catchall for “Hey, it’s crazy out there!”

The 4 VUCA categories

  • Volatility is defined as the quality of being subject to frequently occurring, quick and significant change. In a Volatile market, say for example, the prices of the commodities can increase or decrease considerably in a short span of time, and the direction of a particular trend may suddenly reverse.
  • Uncertainty is a component of a situation wherein, both the events and outcomes cannot be predicted.
  • Complexity involves a multiplicity of factors and issues, some of which can be interconnected. (Some models also include the term 'chaotic', changing the acronym to VUCCA)
  • Ambiguity is manifested in difficulty of understanding exactly what the situation is and a lack of clarity.