Strategy models & frameworks

VACU Model & Analysis

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What is it?

The VACU Model* enables analysis of risks, or issues of concern, in terms of their Volatility, Ambiguity, Complexity and Uncertainty. Applied to strategy, the VACU Model demonstrates that future possibilities, with different degrees of understanding and predictability, present different challenges and are therefore best managed using different solutions.

*The VACU Model is an adaptation of the VUCA framework, often attributed to General Maxwell Thurman, and cited in strategic leadership documents as far back as 1987.

The VACU Model and VACU Analysis template feature in Mike’s book ‘The Strategy Manual: A step-by-step guide to the transformational change of anything‘ and are also covered in our Strategy Master Workshops.

How do I use it?

A critical theme in building any type of strategic adaptability is understanding and anticipating the future. For any given future risk, opportunity or issue of concern, volatility, ambiguity, complexity and uncertainty, as ordered in the VACU Model, can be used to represent different types of unknowns and different ways of turning ignorance into insight. The VACU Analysis template can be used to analyse each issue to identify the type of future challenge being faced, and the appropriate solution to effectively adapt to the associated levels of uncertainty and unpredictability.

Explanation:

The VACU model is a minor but significant adaptation of the VUCA framework (Volatility, Uncertainty, Complexity and Ambiguity), which is cited frequently by online sources and usually attributed to General Maxwell Thurman of the US Army who, in 1991, characterised “the strategic leadership environment in terms of volatility, uncertainty, complexity and ambiguity.” Ordering the acronym as VACU rather than VUCA allows the themes to follow a continuum of decreasing understanding and increasing unpredictability about the future.

Volatility
When an issue is volatile, you know it is likely to happen, you just don’t know when, nor for how long. In which case, you may be able improve your surveillance capabilities. The sooner you know things are about to happen, the better you will be able to respond. If that isn’t possible, you may be able to build greater resilience to withstand the stress, even if it arrives undetected.

Ambiguity
In ambiguous situations, there are only a few possibilities, but they all seem equally probable. In which case, the time may have come for small scale tests and experiments. Minimum viable products may need to be prototyped. You need to get out of the office and start asking customers key questions.

Complexity
If an issue is complex, there are lots of moving parts and lots of interactions between them. Out of that comes too many possibilities and insufficient insight into which of the many possibilities are plausible, which are probable and hence which you should plan for. The solution is likely to come from greater knowledge and expertise: does experience of similar situations in the past lead to a set of more (or less) likely outcomes?

Uncertainty
Under circumstances of uncertainty, anything’s possible. Issues are typified by high levels of confusion and complete unpredictability. In which case, what is needed is more information or better information. The more that a confusing situation can have its causes and effects identified and named, the more likely it is that these causes and effects can be connected.

Representing unpredictability in this way prescribes what to do in response; e.g. in volatile situations, have better sensors, whereas in complex situations, get more or better knowledge and expertise.

 

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