Exploring Crypto’s Future Using VUCA Analysis

It’s easy to predict the future when things are stable, certain, simple, and clear. The prediction goes something like this: tomorrow will be exactly like today.

Rinse. Repeat.

No one lives in that world.

We live in a VUCA world

“VUCA” is an acronym for volatility, uncertainty, complexity, and ambiguity. VUCA was originally developed by the US Army War College in the late 1980s to describe conditions after the end of the Cold War. It came into common use after 9/11.

Futurists use VUCA to address the uncertainty that’s implicit in nearly every organization and community.

In the example below, we’ll apply VUCA to cryptocurrency, and then show how you can apply this approach to your organization or community.

VUCA X Crypto

We’ll use a 12-box table to break cryptocurrencies down into each of the VUCA characteristics.

[Why did we choose crypto? We believe it - and decentralized finance - are examples of a larger trend towards decentralization of socio-economic systems including supply chains.]

How can I apply VUCA in my community, system, or organization?

1. Select an issue, trend, or domain that is experiencing turbulence.

2. Create a 12-box table like the one above and map the volatility, uncertainty, complexity, and ambiguity across the features, examples, and actions. Here are some questions to help you fill in the boxes:

   1. Feature: How is this VUCA factor featured or demonstrated in your chosen topic? What is driving this factor to be present?

   2. Example: What is a concrete example for this factor in your topic? Where and how is it relevant to your organization, network, or community?

   3. Action: What might be some approaches for your organization, network, or community to address this specific factor?

Why is VUCA analysis useful?

• It helps clarify how much is known about the issue, trend, or domain. Knowing what you know and what you don’t is incredibly valuable for avoiding blind spots, the black ice of planning.

• It helps you brainstorm a range of potential actions or solutions. This helps you move from “passive victim” to “informed change-agent.”

Can I base my strategic plan directly on this kind of VUCA analysis?

We don’t recommend this. VUCA is more like a SWOT (strengths, weaknesses, opportunities, threats) analysis – a good starting point for some components of strategic planning but insufficient for an entire organization’s or community’s plan.

Should I use VUCA in place of scenarios?

VUCA analysis can offer valuable input for scenario planning, e.g., deciding the scope of scenarios and particular types of challenges and opportunities to explore, but VUCA is not a substitute for scenarios.

How do VUCA and scenarios relate to each other?

If you’re experienced in scenarios, your leadership team or subject matter experts may consider questions like:

• What may be the most likely future for how the four VUCA factors unfold in your community or industry? How might potential solutions be implemented? What might be their most likely intended and unintended implications or impact?

• What could go wrong? How might the four VUCA factors generate even more challenges for your community or industry? Where and how might the implementation of potential solutions backfire or fall short?

• In a visionary or “surprisingly successful” future, how might the VUCA factors unfold? What would it look like when the right things happened in the right ways?

Have you done a VUCA analysis of an issue facing your community or organization?

Where and how might the VUCA 12-Box help you pursue brighter futures?