Manage Uncertainty in Business

Watch us on Twitter

Not getting this information sent to you directly? Sign up for your FREE monthly Smartmanager newsletter today.   Sign up now!  

-------------------------------------------------------------

How to Successfully Manage Uncertainty in Business

Why Uncertainty Is So Perplexing to Some Managers

Do you have some favorite managers? Do they usually appear to make good decisions in all business conditions? Do they always display a coolness under fire? Do they seem to shake off decisions that don’t work well and continue to manage well?

You are probably also aware of others who become timid and indecisive at certain times. They often have difficulty making decisions and delay acting. Instead of confident decision-making, they tend to prolong an analysis of the situation, gathering more information before taking action.

The above different scenarios occur every day in the workplace and are usually the result of  uncertainty. While the specific issues may differ, the root cause of one manager’s success and another’s failure is the condition of uncertainty. Simply put, some managers treat uncertainty as just another factor in business operations, while others seem to need a level of certainty before making operational or strategic decisions.

Often fueled by the fear of making the wrong decision, without having all the facts, some managers do little or nothing (which, of course, is actually a decision – usually the wrong one) until they can accumulate “enough” information. Others, although they may be perplexed by current uncertainties, can take the data at hand and extrapolate or project the probable results of one decision versus another.
Both groups will readily admit that managing during uncertainties is  not  an ideal situation. However, reality dictates that most businesses operate in a climate of uncertainty, requiring the best managers to remain decisive – perplexed or not – to move on successfully.

To become one of the best of the best, you need to accept the reality of uncertainty, which brings classic  risk versus reward  situations. Uncertainty often creates confusion, perplexity, and even fear. The best managers find ways to look past these potential roadblocks, keep their eyes on the prize, and maintain their composure while making necessary decisions. Those that tend to react lackadaisically allow the uncertainty to take center stage and get top billing. Here are some tips to help you enter that respected circle of “favorite” and successful managers while facing down uncertainty.

How to Better Manage the Uncertainty Factor

  • Admit that most of your responsibility involves decisions you must make in uncertain conditions.  This is not the over-simplification it may first appear. Admitting that you will be required to make many more decisions in uncertain situations than those in obvious and safe haven conditions can be therapeutic. This admission should give you more confidence that the “playing field” is level for you, your peer managers, your competition, and executive management that may be evaluating your performance.
  • Exhibit some of those “special” management skills that the best managers display during uncertain conditions.  Most often, those skills that appear to be so special, sometimes even magical, simply involve your ability to make a decision based on the information at hand. While others are paralyzed by perplexity, top managers analyze the limited data available and select the best course of action.
  • Be consistent.  Ask yourself, “Do I manage well in good times and bad, but not so well in uncertain conditions?” Spend some quality time asking another simple question, “How do I handle the ‘maybes’ at work?” You will often learn that you manage consistently during the best and worst of times, but become a different person when faced with the "maybes." Strive for consistency, particularly when you know you manage well. Adopt the same persona and decisiveness during the uncertain periods.
  • Look at both the possibilities AND the probabilities of your decisions.  The best “uncertain times” managers consider both of these issues, knowing that analyzing only one of these factors heightens perplexity, confusion, and inaction. For example, you’re faced with decisions that could a) increase net profit by $2 Million, b) decrease net profit by $2 Million, c) increase net profit marginally, but greatly improve branding and image, or d) have no effect on net profit or image. Considering just these four possibilities may only generate more uncertainty and inaction. However, considering “perceived probabilities” may clarify your choices. For instance, assume that possibility a) has a 20% probability of success, while b) carries a 25% chance, c) brings a 40% success probability, and d) delivers a 15% chance of occurring. Ah, clarity. Your odds of success are 60% versus a projected failure probability of 25%. Adding in the “first, do no harm” probability (15%), you may have a 75% probability of success or at least status quo. Considering only one of the issues solves nothing, but evaluating both components gives you the ammunition to make a decision.


Face it. Most of your management decisions will be based on having around one-half of the information you’d like to have, may or may not be based on fact and truth, and typically involve that important – and elusive – condition: timing. Be consistent, decisive, and select the decision that offers the best probability of success – then decide.