We live in uncertain times. Pandemics, wars, supply chain disruptions, and even just the networked and highly interconnected nature of the modern digital business environment mean that predictions can never be perfect. Some of this uncertainty can be resolved via weak signals that suggest what sort of future lies in front of us. Much of this future, however, is unknowable and unpredictable. It’s hidden behind future decisions (by us and by others), latent possibilities out in an organization’s extended ecosystem. Only some of these possibilities will crystalize into actualities, a process we can only influence rather than control.1
The unknowable and unpredictable nature of this environment runs counter to a dominant disposition in business: to decide to act. Business has a bias for action—a propensity to commit to the “best” opportunity.2 Many organizations might be considered large ships, and so, setting them on a new course may require significant time and effort to overcome their inherent inertia. It’s thought to be best to set a clear direction, to pick a single course of action so that leadership can help coordinate the action required to bring the ship around. Insights from sensing tools, such as analytics and machine learning, can be used to detect and evaluate the options discernible by the organization, with the organization’s leadership then committing it to what’s believed to be the “best” option based on the data at hand.
However, the uncertainty and ambiguity we’re experiencing means that the best perceived option might not be the one suggested by the available data, the option that our natural availability bias3 suggests we should take. And the best option might not even be visible from our current vantage point. It might be a latent possibility that we’re yet to discover, an unknown unknown. The option supported by the biased and incomplete data we have may even be the worst option, taking us away from (rather than toward) our goals.
Moreover, decades of unbundling operations and building partner and supplier ecosystems have often resulted in organizations that resemble flotillas rather than bulk carriers. Strategy and execution are thus intertwined and interrelated, extending from within the organization to the ecosystem’s edge. The ambiguity often emerges from within the ecosystem, not just outside it.4
As we move further into the next big challenge for our global economy—rapid and large-scale decarbonization, and the shift to a sustainable economy—it becomes even more necessary for leaders to find ways to flourish in ambiguity. Many of the answers to the climate problems we face today are not yet known, nor are we even aware of the problems that we’ll confront. Leaders may need to make decisions today in anticipation of what will likely be available in the future. This is a new and challenging position that could require a different model for decision-making.
Rather than deciding to act, we should consider acting to decide.5 Instead of committing to one “best” option based on available data, we could invest in the many small actions that help improve our understanding of the current situation and foster the discovery and development of all options, the possibilities, available to us. As our understanding improves, some of these options may wither and fall away. Others could crystalize, transforming from possibility to actuality, transitioning from a potential or good idea to being the logical next step for the organization. At this point, when the obvious choice sits in front of us, we can decide and commit.
We can see this distinction between “decide to act” and “act to decide” in the responses to the onset of the global pandemic. Some organizations, even organizations widely considered among the most creative and innovative, struggled to decide what to do. They froze, battened down the hatches—suspending operations and furloughing employees—hoping that the trouble would soon pass.6 Meanwhile, other organizations, unsure what to do, did many small things. They fostered new relationships (new partners, suppliers, and even customers) and explored new opportunities, developing the possibilities available to them, some of which crystalized into actualities.
StageKings is one firm that acted to decide.7 Stay-at-home mandates and guidelines at the start of the pandemic killed the firm’s business of building stage sets for some of Australia’s biggest events. Rather than focusing on what they couldn’t do, management looked for what the firm could do, tentatively exploring new products, markets, and clients. Soon they found themselves making flat-packed, assemble-yourself furniture aimed at the suddenly huge market of people who needed to work from home. The venture, branded IsoKing, grew so quickly that the firm had to hire workers rather than lay them off. The new business was soon larger than the old.8
The possible difficulty that many executives have in acting to decide is managing their tolerance for ambiguity. Ambiguous and uncertain situations can be considered a source of threats to be dealt with by creating a veneer of certainty because leaders believe they’re expected to be decisive. In these murky circumstances, where there may be no clear “best” action to commit the organization to, the tendency could be to read available information in a way that hides (but doesn’t deal with) the uncertainty. But deciding to act when there isn’t enough data to make an informed decision can lead to suboptimal results.
The solution could be to change one’s predilection for uncertainty:9 to foster attitudes and behaviors that enable one to effectively engage with and manage the many uncertainties and unknowns (and unknown unknowns) that are inherent in our current environment, rather than to ignore or hide from them. Comfort with ambiguity can come from the confidence that one knows how to productively engage with it. And productively engaging with ambiguity often requires balancing our bias for committing to a single course of action with a bias for learning and exploration—taking smaller actions to determine the best way forward.
Sometimes the path forward will be clear: We may know that it is directionally correct (though details remain to be sorted out). At other times, the path could be uncertain: We’ll need to consider exploring options, to feel out possibilities and develop them until we have an actuality (at which point, we can commit).
Acting to decide requires leaders to have the courage and awareness to know when to pivot—because acting to decide doesn’t happen once but many times through the course of solving a problem or taking advantage of an opportunity. In this approach, success can come from the ability to sense and understand the landscape, sensing possibilities, and pivoting toward opportunities and around challenges as they arise. In this way, ambiguity is something leaders should embrace, a source of ideas and opportunities, a well of creativity and innovation,10 rather than something to avoid.
Improving one's tolerance for ambiguity can be viewed as an emotional, as well as intellectual, change—of attitudes and behaviors—rather than a skill to be developed. It’s about building leaders’ confidence in their (and their organizations’) ability to explore and learn when faced with uncertainty rather than feeling compelled to prematurely commit to decisive (and often wasteful) action.
Today’s businesses face profound challenges. In an ever-changing world, leaders are being asked to identify and manage their environmental, social and governance (ESG) risks—from supply chain transparency to decarbonization. But with these risks comes a unique and extraordinary opportunity to shape a more vibrant economy. One that’s more productive, equitable and sustainable. Drawing from deep experience and cutting-edge capabilities, we help you take meaningful action by understanding and engaging with these risks and opportunities.Learn More