Philosophy of Digital Man and Digital Society - 2024

The Formation and Development of the VUCA Concept Amidst Global Transformation of Humanity

The Emergence and Development of Concepts in Digital Economy and Digital Management Amidst Global Transformation

We find ourselves in an era of profound instability and crisis, marked by a transition to the digital advancement of society driven by the Fourth Industrial Revolution, which demands a fundamental reconfiguration of civilization and a quest for innovative approaches to its realization. Contemporary civilization, challenged by global and paradigmatic crises, necessitates a rethinking of its worldview foundations, as it grapples with significant global challenges and experiences a crisis of values underpinning the existing world order.

The VUCA concept has emerged from the crises of modern society and has been propelled into prominence by the COVID-19 pandemic, which has given rise to a "risk society" as a consequence of contemporary civilization.

The VUCA framework is intimately linked to societal instability and derives its name from four English words:

1. volatility;
2. uncertainty;
3. complexity;

The VUCA concept represents a framework of the Fourth Industrial Revolution, also referred to as "lifelong learning." To survive in this world, one must be dynamic and capable of rapid adaptation. The contemporary interpretation of VUCA is grounded in the theory of complex systems, with its foundation resting upon AGILE methodology and philosophy, which constitute a methodology for navigating the complexities inherent in unstable systems. The VUCA concept encompasses a variety of methods, techniques, and approaches to software development that are based on the principles enshrined in the "Manifesto for Agile Software Development," which acknowledges the complexities associated with risk.

The principles, methods, and approaches to analyzing complex systems can lead to transformations at all stages of enhancing action algorithms and management mechanisms, wherein AGILE methodology emerges as a system of new values. AGILE methodology extends to the analysis of the digital paradigm of economics and management, incorporating approaches such as Scrum—structured frameworks—and Kanban—balance approaches—that are utilized in innovative activities, facilitating the creation of innovative products, the expansion of digital products and services, and the emergence of new business forms grounded in digital technologies.

The theory of self-organizing systems aids in the analysis of non-equilibrium, uncertainty, bifurcation, stochastic information, and system drift, from which one must derive new priorities.

For the analysis of the VUCA concept, the SySt (Systemic Structural Methodology) serves as a methodology for understanding processes of change towards stability. At its core, the VUCA concept seeks to prevent or mitigate crises and instability, enhance innovation, and leverage technology transfer as instruments for implementing innovative endeavors, reforming management systems through the application of AGILE methodology, restructuring human consciousness, and cultivating a new system of values. The VUCA framework encapsulates:

1. Volatility, characterized by rapid and unpredictable change, which renders future scenarios and planning impossible. Volatility describes the instability of systems marked by fluctuating circumstances and unforeseen transformations in terms of speed, nature, volume, and dynamics in unstable markets, shaped by national mentalities.
2. Uncertainty, which arises from disruptive changes that make it challenging to foresee the future. The term "uncertainty" signifies the lack of information necessary for predicting outcomes and planning appropriate actions. The Global Uncertainty Index (GUI) has been introduced, correlating with conditions of instability and macroeconomic indicators based on the volatility of key financial and economic variables, risks, low GDP growth, and economic instabilities affecting 143 countries with nearly two billion inhabitants.
3. Complexity, which results in a multitude of intricate facts, causes, and factors that lead to an increasing number of challenges. Complexity contributes to a confluence of complicated realities that compound existing problems.
4. Ambiguity, which creates difficulties in answering fundamental questions of "who, what, when, and why." Ambiguity exists as a tangible reality, as nothing remains stable; humanity must acknowledge changes that can be controlled in the absence of a clear understanding of the rules of engagement.

Complex systems consist of vast diversities of parts capable of generating new qualities, manifested in the spontaneous formation of temporal, spatial, and functional structures. These systems embody self-organization, nonlinear dynamics, turbulence theory, synergetics, dynamic systems, and stochastic processes that significantly impact human existence in the digital age of machines. Consequently, it is essential today to adapt to ongoing changes, cultivate creativity, communication, and critical thinking.

Prior to the pandemic, many may have overlooked or failed to perceive threats to economic balance, culminating in the chaos that ensued from swift, unpredictable changes accumulated over years due to a lack of critical thinking. This was exacerbated by informational stochasticity, wherein the exponential increase of information (big data) overwhelmed leaders; indeterminacy prevailed, obstructing predictability.

Informational stochasticity dominates in environments of instability, uncertainty, turbulence, chaos, and risk, necessitating that leaders master the vast realm of information and advanced creative technologies to survive during the coronavirus pandemic, which requires overcoming informational entropy (a measure of uncertainty, chaos, and disorder).

Instability signifies a state of threat, the absence of changes in the rules of engagement (as noted by S. Huntington), a lack of structural and organized transformations (as observed by D. Searing), and an imbalance of political forces (according to J. Liveli), all of which impact the stability of small and medium-sized enterprises and organizations.

Contemporary society is characterized by a state of uncertainty regarding the trajectory of development, as it grapples with an unstable economy and the proliferation of corruption alongside other negative phenomena within state and regional authorities, a rift within the political elite concerning the establishment of rules, disruption of balance among functioning power structures, and a lack of harmony within society. This instability is accompanied by challenges that affect economic processes, giving rise to:

1. Issues of the post-industrial, information society, mediated by informational stochasticity;
2. Risks that are inherent to society as both a social and political organism, defining its unstable condition prone to self-destruction;
3. Disorganization and decentralization of economic, political, and cultural life as an essential trait of an unbalanced world;
4. A crisis in governance as a consequence of instability, driven by a failure to adapt management systems to the chaotic and mass formation of consciousness;
5. A decline in personal accountability of managed systems for societal developments;
6. An inability to apply a systemic approach to achieve sustainable changes, underestimating the situation, and a lack of organizational culture.

The formation and development of the VUCA concept are intricately linked to the crisis of modern civilization and the alarming context of the COVID-19 pandemic, which has led to instability and uncertainty, an anthropological catastrophe, various forms of destabilization, and the disintegration of society across all facets of public life, all determined by the chaotic movement of flows, unpredictability, and opacity.

Within the concepts of instability, uncertainty, complexity, and ambiguity crystallize all the crisis issues and contradictions of contemporary society in the face of economic and financial turmoil. Social chaos embodies a state of a complex nonlinear system that self-organizes amid the transformation of outdated structures, generating various forms of risk. A persistent phenomenon of social chaos is the existential risk faced by individuals due to crisis management, indicating an escalation of tension and necessitating synergy and self-organization, as well as the development of mechanisms to neutralize threatening situations.

The emergence and development of the VUCA concept, born from the civilizational crisis and a state of uncertainty, constitute an integral part of a risk society, where the transition from one level of social order to another is accompanied by phenomena of social chaos and spiritual crisis. Risk at all levels of management serves as a peculiar indicator and attribute of the global transformation of society—encompassing both natural and social processes, which, due to their inherent instability, are prone to self-destruction.

Responsibility for this instability and uncertainty is placed upon the elites and their ineffective decision-making in governance. The self-unfolding of self-organizational mechanisms—both bifurcational and adaptive—leads to new parameters of order, contingent upon the economic, historical, political, and legal foundations of society.

Thus, the formation and evolution of the VUCA concept occur within a rather contradictory world of turbulence, characterized by three prevailing conditions:

1. the presence of uncertainty;
2. the necessity of choosing alternatives;
3. the capacity to assess the onset of alternatives.

Consequently, we can draw a conclusion. The formation and development of the VUCA concept unfold within a "risk society" (a term coined by N. Luhmann), accompanied by a crisis of contemporary civilization, which for Ukraine possesses several particularities:

1. the crisis manifests as a complex phenomenon across all spheres of social life;
2. it is driven by a growing scarcity of resources for significant societal reformatting;
3. at the core of the crisis is the transition from an industrial-agrarian society to a post-industrial and digital one, necessitating the advancement of breakthrough technologies and a shift to the sixth technological paradigm, which in turn demands the development of science, akin to the model in China (where one state budget is allocated for science, and another is privately funded by the Chinese diaspora living abroad who invest in their homeland's scientific endeavors);
4. the crisis of the paternalistic state and the imperative to transition to a new type of state characterized by a "spiritual economy" and new dimensions and values reflective of Enlightenment 2.0;
5. a demographic crisis marked by high mortality rates and low birth rates exacerbated by the COVID-19 pandemic;
6. a crisis of traditionalism and its inability to facilitate the renewal of cultural regulations in favor of advancing sociotechnological progress, rational thought, science, and spirituality.