How Finance Can Navigate a VUCA Climate

VUCA is an acronym that stands for Volatile, Uncertain, Complex, and Ambiguous. It  originated at the United States Army War College, where it was apparently created by military leaders in the late 20th century to describe a murky, post-Cold War reality containing unfamiliar problems and risks. 

Over time the acronym migrated into the business community. It’s often used to illustrate the global economic climate during down cycles and periods when business leaders must confront increased turbulence, unpredictability, and a higher risk of disruption. 

The pandemic and subsequent geopolitical upheaval fueled a VUCA climate that made it generally more challenging to do business. Finance teams, which have to keep the business’s cash flowing and decide how they should engage with customers, have been especially pressured during this unprecedented period. It’s much more difficult to make important decisions and plans under these conditions. 

The key asset finance teams need to boost decision-making capability is data. But in a VUCA climate, decisioning data can change abruptly. Customers can start having financial problems or experience other impacts that affect their business relationships, including their payment patterns. 

This is why the source of finance teams’ business decisioning data is so important — especially in a VUCA environment. Finance needs data that will provide the truest, most accurate picture of its customers, at any and every moment.

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Find out more about how finance teams can create a strong data foundation that enables better decision-making, helps improve cash flow, and creates competitive advantage for the business.

And then, learn more about how we help finance leaders improve risk management and business growth.