Cope with Ambiguity, Uncertainty & Risk
Main goal: Make decisions dealing with uncertainty, ambiguity, and risk
Starting something new always comes with some risks. It’s new, there are lots of things you don’t know yet and that can be a scary place to be. Most new entrepreneurs deal with this in two different ways. They either freeze up, are scared and procrastinate, or they are excited and really look forward to what’s to come and can’t wait to get going.
Knowing this and having a plan to test unknown scenarios does help to deal with these situations much better. It’s all a question of how you approach it. Even if you are highly excited and can’t wait to jump straight in, doing it with a plan and a step-by-step process is the best way to enjoy that new venture.
There are many decisions you have to take on the spot. It is wise to have some direction and pillar points that help you focus in the right direction and take quick decisions that will get you where you what to go.
In short, coping with ambiguity, uncertainty, and risk is about:
- Making decisions when the result of that decision is uncertain, when the information available is partial or ambiguous, or when there is a risk of unintended outcomes
- Within the value-creating process, including structured ways of testing ideas and prototypes from the early stages, to reduce the risks of failing
- Handling fast-moving situations promptly and flexible
Let’s look at each skill and see what each level will bring you:
Cope with uncertainty and ambiguity
| Level | Ability |
| 1 | I am not afraid of making mistakes while trying new things. |
| 2 | I explore my own ways to achieve things. |
| 3 | I can discuss the role that information plays in reducing uncertainty, ambiguity and risk. |
| 4 | I can actively look for, compare and contrast different sources of information that help me reduce ambiguity, uncertainty, and risks in making decisions. |
| 5 | I can find ways of making decisions when the information is incomplete. |
| 6 | I can pull together different viewpoints to make informed decisions when the degree of uncertainty is high. |
| 7 | I can make decisions by evaluating the different elements in a situation that is uncertain and ambiguous. |
| 8 | I can set up appropriate strategies for collecting and monitoring data, which helps me make decisions based on sound evidence. |
Calculate risk
| Level | Ability |
| 1 | I can identify examples of risks in my surroundings. |
| 2 | I can describe risks related to a simple value-creating activity in which I take part. |
| 3 | I can tell the difference between acceptable and unacceptable risks. |
| 4 | I can weigh up the risks and benefits of self-employment with alternative career options, and make choices that reflect my preferences. |
| 5 | I can apply the concept of affordable losses to make decisions when creating value. |
| 6 | I can compare value-creating activities based on a risk assessment. |
| 7 | I can assess the risks my venture is exposed to as conditions change. |
| 8 | I can evaluate high-risk long-term investments using a structured approach. |
Manage risk
| Level | Ability |
| 1 | N/A |
| 2 | N/A |
| 3 | I can critically evaluate the risks associated with an idea that creates value, taking into account a variety of factors. |
| 4 | I can critically evaluate the risks related to the formal setup of a value-creating venture in the area in which I work. |
| 5 | I can demonstrate that I can make decisions by weighing up both the risks and the expected benefits of a value-creating activity. |
| 6 | I can outline a risk management plan for guiding my (or my team’s) choices while developing my value-creating activity. |
| 7 | I can use strategies to reduce the risks that may arise during the value-creating process. |
| 8 | I can come up with strategies to reduce the risk of my value-creating initiative becoming obsolete. |
NOTE
If you are interested in learning and practising this skill group, please use the form on this page and tell us about it. We use this info for our planning for future programs and we will keep you up-to-date about it.
