TOPIC 6 - 'Levels' of uncertainty

Question 1

What characterizes a Level 1: Clear enough future in terms of uncertainty?

Answer 1

“Slow moving environments, well-established markets, not prone to groundbreaking tech advancements, information rich, stable players, high barriers, stable regulatory environment, suppliers consistent, no great changes in the market.”

Question 2

Why is the future not predictable at Level 1 and what type of uncertainty is present?

Answer 2

Future is NOT predictable. There is uncertainty but not strategic uncertainty: what to do and how to win is clear.

Question 3

What is the nature of uncertainty at Level 2: Alternate futures?

Answer 3

Mutually exclusive options, one of which will occur but we don’t know which one.

Question 4

Can you give examples of situations that represent Level 2 uncertainty?

Answer 4

Which company will win a contract? Will a new law be legislated? Which technology standard will dominate? Will competitor do X or not?

Question 5

Describe Level 3: A range of futures and its ‘Bounded uncertainty’.

Answer 5

We can put a boundary of plausibility around scope of outcomes, but not clearly specify within. Societal norms and values are shifting, adoption of new technologies/new business models is ongoing, unstable macro-economic conditions, political and legislative environment is changing

Question 6

What is true ambiguity in the context of Level 4 uncertainty?

Answer 6

Outcomes are unknowable and we cannot put a plausible boundary on the range of outcomes. We do not know whether we know all the important factors or variables, or if we are even asking the right questions

Question 7

What are some sample situations that might be classified under Level 4 uncertainty?

Answer 7

Radical new capabilities like hydrogen energy, new industries, e.g. genomic medicine, societies in or just after a major shakeup

Question 8

Why is Level 4 uncertainty usually temporary and transitional?

Answer 8

Because it represents situations where “outcomes are unknowable” and there is a lack of understanding of “all the important factors or variables,” which usually becomes clearer over time.

Question 9

Which levels of uncertainty are most uncertainties classified under?

Answer 9

Most uncertainties are level 2 and 3.

Question 10

How should organizations choose their future-management toolkit?

Answer 10

Choose future-management toolkit that fits with the situation’s uncertainty level.