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When nothing is normal: Managing in extreme uncertainty by McKinsey&Co

In normal times, organizations face numerous uncertainties with varying consequences, and leaders attempt to respond to these changes through well-established processes and structures. However, in this unprecedented global crisis, leaders need operating models to respond quickly to the changing environment and keep their organizations able to meet the challenges. Uncertainty can be measured in magnitude and duration. Using these two measures, the extreme uncertainty consequent to the global economic and public health changes of the COVID-19 pandemic carries unprecedented novelties in our history. The magnitude of uncertainty that organizations face in this crisis makes it essential that organizational responses are flexible, agile and based on constant learning.

The document available here from McKinsey&Co, describes the ideal structure of an organization under these conditions, as well as the crucial steps to be taken:

- The ability to respond actively to a crisis is possible if there are early warning systems, rapid decision making and transparent operating principles to guide that decision making;

- The 3 essential verbs in crisis mode are: discover, design and execute!

- Need for sustainability models: after the initial time of a crisis, organizations need to acquire new long-term models of processes that allow undoing lock-downs, recovering old routines, scaling down action in emergency mode, always with the flexibility to regression, if the situation requires it.

So, extreme uncertainty can be defined in terms of novelty, magnitude, duration and rapid rates of change and always generates operational and leadership difficulties for organizations. Leaders must develop a greater tolerance for ambiguity, more accelerated operational cadence and a culture of constant review and change. As the crisis is diluted, processes must be adapted to ensure that the organization is sustainable and can even take advantage of potential new opportunities.