Understanding the context and dynamics of an ecosystem is essential for decision-making. In recent years, the VUCA model has been the benchmark for understanding our environment, although it now seems to have been superseded by a new chaotic stage in which a new framework is emerging: BANI.
We review both concepts in this post.
VUCA
The VUCA model (Volatility, Uncertainty, Complexity, Ambiguity) was coined in 1985 by economists Warren Bennis and Burt Nanus, who explained it in their book "Leaders. The strategies for taking charge".
The fundamental premise of the authors is that the challenges posed by various external factors — summarised in the four terms that make up the concept — require management and leadership in companies to take into account the impact of these factors on their organisations.
The model gained relevance in the early 1990s when it was adopted by the US Army War College in Carlisle, Pennsylvania. It was used as a way to describe the challenges of operating in a new world where the collapse of the Soviet Union and the end of the Cold War meant a change in the status quo.
Let us break down the components of the acronym:
Volatile: Many areas — such as markets, share prices — are subject to extreme fluctuations.
Uncertain: In the VUCA world, long-term forecasts have become difficult to make. This creates instability and uncertainty.
Complex: The world is becoming more complex because globalisation and digitalisation are creating more connections between different players in the market. It is no longer a matter of simple cause and effect mechanisms; everything is somehow interrelated.
Ambiguous: In a complex world, there are no absolutes. Nothing is ever black and white, yes or no. Any event can be seen and interpreted in different ways. It has become impossible to clearly identify causes or estimate effects.
But then the pandemic arrived, prompting a rethinking of the VUCA paradigm. In 2020, futurist Jamais Cascio wrote “Facing the Age of Chaos”. In it, the author explores how the pandemic and contemporary challenges require a new framework for understanding, which he calls BANI, an acronym for Brittle, Anxious, Nonlinear and Incomprehensible.
BANI
Cascio writes: "This is a framework for articulating increasingly common situations in which simple volatility or complexity are insufficient lenses for understanding what is happening. Situations in which conditions are not simply unstable, but chaotic. In which outcomes are not difficult to foresee, but completely unpredictable. Or, to use the particular language of these frameworks, situations in which what happens is not simply ambiguous, but incomprehensible."
He adds: "At least superficially, the components of the acronym could also suggest opportunities for response: brittleness could be met with resilience and relief; anxiety can be alleviated by empathy and awareness; non-linearity would need context and flexibility; incomprehensibility requires transparency and intuition."
In his manifesto, the author uses the word that we have seen par excellence associated with how to deal with the Covid-19 crisis: resilience. If something is fragile, then we must defend ourselves by strengthening our ability to adapt. Hence the importance of a culture of collaboration.
BANI environments are characterised by promoting anxiety, the antidote to which is greater empathy, the result of communication and transparency between people and organisations. Furthermore, the lack of linearity cannot be addressed with a rigid approach. Business plans that rely on established methods and processes run the risk of becoming obsolete in a short time if they do not adapt to the changing needs of the market and customers.
If we break down the acronym again:
Brittle: Fragility is no longer just a matter of volatility, but rather a sudden and unexpected shock or even the destruction of a seemingly stable system, which can lead to a global domino effect. Like a virus that appears in a city in China and rapidly spreads into a pandemic.
Anxious: In this fragile ecosystem, the most logical consequence is anxiety, accompanied by fear of decision-making and passivity. In an unpredictable environment, any possible choice seems to lead to catastrophe. The news that constantly impact us do not help to reduce this anxiety and increase the feeling of lack of control.
Non-linear: In a non-linear world, writes the author, the law of cause and effect no longer exists. The most trivial problems can have unfathomable and complex consequences, which may not be detected until much later. Therefore, it becomes difficult to deduce causes and create medium- or long-term plans.
Incomprehensible: If the VUCA paradigm was characterised by ambiguity, the BANI environment goes further and becomes incomprehensible. Everything influences everything else at different levels, making it difficult to understand the magnitude of what is happening and to find patterns that explain the situation.
How does the BANI concept differ from the VUCA world?
VUCA and BANI are not necessarily mutually exclusive. Both terms describe the challenges of operating in a rapidly changing world, but there are some important differences between them.
The VUCA concept has long been used to describe the volatility that has become the norm in the business world. However, the BANI model goes a step further by considering the scenario to be chaotic and unpredictable.
I believe that the BANI model makes a lot of sense today with an American administration led by Donald Trump, who seems to be a catalyst for this trend with his opinions and actions.
The ability to make quick decisions, along with flexibility and resilience, seem to be key tools for surviving in a chaotic model.
The following chart, from Batterman Consulting, summarises how we can describe the current and future BANI world from the perspective of the 'old' VUCA
Sergio Rodriguez
Accoun Director
