The common nominator is the lack of information or clarity about outcomes. In risk management, uncertainty refers to the unknown — unforeseen developments whose probability and impacts cannot be quantified. They arise from technological trends, shifting customer behaviour, changing regulations, geopolitical shifts, and fluctuating markets. These factors and their interrelated effects impact competitive advantage and the very viability of a business.
Conventional wisdom often encourages leaders to battle uncertainty by seeking clarity, but this approach can controversially lead to inertia and missed opportunities. Thus, the question is not about will uncertainty occur but how to handle it.
The trap of seeking certainty
It is natural to want certainty in decision-making and instinctively seek control and predictability when facing ambiguity. In these situations people tend to rely on past patterns or try to project them into the future. Tools like scenario analysis and forecasting are valuable, but they have limitations. The further into the future we look, the less accurate our predictions become.
The result of trying to create certainty in an inherently uncertain world is that decisions are often cautious, incremental, and overly reliant on historical data. When leaders focus solely on minimising risk by waiting for more information or clearer trends, they slow down. This creates a paradox: while attempting to avoid failure by being cautious, businesses can fall behind more agile competitors.
In competitive markets, playing it safe rarely pays off. While it makes sense taking calculated risks, there is also a risk in taking no action at all. In today’s environment, delaying decisions can be more damaging than making imperfect ones. If you risk nothing, you risk everything. The pursuit of certainty can kill a company, not with a single dramatic failure, but with a thousand small delays.
Sustained competitive advantage not despite, but with uncertainty
I find a personal metaphor of coping with uncertainty in long-distance trail running. Running ultramarathons teaches me that I can never be fully certain of what lies ahead on race day. Conditions on the trail are constantly changing, and even familiar paths can become unpredictable. Thus, I need to trust my own capabilities and constantly develop my agility — both strategically and operationally or mentally and physically, so that I can adapt to whatever comes my way. Reading weather forecasts or condition reports from previous weeks or years cannot guarantee better performance. What truly matters is my own ability to adjust with every step and respond to uncertainty effectively.
As a business leader, you need to be able to make decisions in uncertainty, act on them, and ensure that your business operations are equipped to execute those decisions effectively. So instead of battling uncertainty by attempting to predict and control every variable, leaders can choose a different path: leverage uncertainty and build capabilities that thrive on it.
The core of this approach is developing business agility — the capabilities that allows making decisions quickly and adjusting operations fluidly in response to new strategic directions. This does not mean abandoning strategic thinking or making hasty choices, but creating systems that allow the business to adapt swiftly, take advantage of opportunities in the face of the unknown, and pivot when necessary. “When necessary” underlined.
Isn’t it more responsible to invest in building adaptable business operations that can leverage uncertainty than to pour resources on creating a false sense of certainty that will never secure a competitive edge? After all, if you had a change-driven organisation with people, processes, and systems you could trust to handle strategic shifts, wouldn’t that better alleviate your personal unease and sense of uncertainty?
