The world – including all businesses – are dealing with a global pandemic, and the level of uncertainty and ambiguity that has come along with it is giving rise to many a problem and opportunity. Global leaders and trusted brands are expected to lead in these times – but it doesn’t seem anyone has a crystal ball with all the answers. However, what businesses and business leaders can do is separate the uncertainty from the ambiguity to inform smart, sound business decisions that will pay off for the long haul.

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So, what is the difference between uncertainty and ambiguity? Aren’t they two sides of the same coin? Not exactly. Here is how Miriam-Webster defines the two terms:

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Ambiguous: capable of being understood in two or more possible senses or ways

 

Uncertain: not known beyond doubt; not clearly identified or defined

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Ambiguity is not understanding the full range of interpretations or options. Uncertainty, alternatively, is understanding the finite option or outcome set, but not knowing which one will prevail. That being said, with uncertainty there is still typically some probability that can be assigned to the range of potential outcomes. 

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What this pandemic has taught us is there is plenty of both – uncertainty and ambiguity – but that it can yield an opening for leaders to shine and stand out where others may be retreating to see what companies do during these challenging times.

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John Foley, co-founder of Peloton, had a recent interview with Reid Hoffman on the Masters of Scale podcast. What we learned was 100s of VCs passed on investing in Peloton because fitness was a ‘dopey’ category – there was uncertainty if the market would prove out, if the product would prevail, and if John Foley (an accomplished executive with a non-traditional entrepreneur CV) was the right leader. Those that did the calculus on the level of uncertainty and still opted in are reaping the rewards.

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That being said, uncertainty is not one and done. Peloton continues to face uncertainty on how much the home fitness movement will last post COVID, as the company has had a nice bump in subscriptions during this time. Every business constantly deals with uncertainty, and it is incumbent upon the management team to scenario plan and evolve the products and/or business model given market conditions to maximize shareholder returns.

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Another example is when Nike chose to take a stance on Black Lives Matter – they understood that it would resonate with a portion of their customer base and that it may alienate others. There was uncertainty on potential impact to the top and bottom line, and there was ambiguity on how the audience may interpret their stance, but that being said, they did the calculus and moved forward. They led and were rewarded in the end for their leadership. 

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The same is true when a new technology or combination of technologies is coming to the fore. Think about Elon Musk’s Boring Company and the Hyperloop project, an ultra-high speed underground public transportation system in which passengers are transported at 600+ mph within a vacuum based tunnel. Impossible? Try me, says Musk who recently tweeted, “first operational tunnel under Vegas almost done.” There is uncertainty in success, perhaps not in Elon’s mind, but in the market. However, one can look at Elon’s success in building the Tesla ecosystem and recent success with Falcon 9 in his SpaceX venture, and calculate that the bet is one worth taking.

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However, as with all technology, there is often ambiguity on the unintended consequences as well, as we are seeing with smartphone addictions and impact to physical and mental health. What could the unintended consequences be to our planet of deep underground tunnels with warp speed public transportation? Some effects are predictable – ideally a drop in fossil fuel emissions as passengers switch from air travel to tunnel travel, but other impacts could be adverse and are seemingly unknown until they occur.

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Many businesses and business leaders deal with uncertainty on a daily basis. Making informed choices in the midst of uncertainty is what separates the stellar C-suite executives from the pack. However, during the time of COVID-19, a lot more ambiguity has also seeped into the environment and market conditions, making it an exceptionally difficult time to lead. 

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How does one deal with the ambiguity of COVID-19 itself? For example, we do not yet know the long-term impacts of COVID-19 on an individual’s health – there is ambiguity here. There will be many post-mortems once we have a more complete understanding of this novel coronavirus, but in the interim, business leaders must make decisions amidst this ambiguity. How should brands best support their customers with new safety protocols and meet them where they are, despite ambiguity on how their actions may be interpreted and uncertainty on when a COVID-19 treatment or vaccine will be available? There is no one size fits all answer. However, one thing is clear – doing nothing and ‘waiting and seeing’ doesn’t seem to be serving anyone. 

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So, given all of this, what can leaders do? They can:

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1. Absorb and interpret the plethora of information available to them, but separate the signals from the noise.

2. Differentiate what they truly don’t know and cannot control vs. what they can assign a probability to and influence.

3. Act by tapping into both IQ and EQ to demonstrate what a company and brand stands for, and what it does not. 

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The one thing that is clear is that in a time of great uncertainty and ambiguity, doing nothing is not a winning strategy. Businesses and brands can make decisions quietly or with loud pomp, but they must act now – in the face of unprecedented uncertainty and ambiguity. This is what will distinguish leaders from the rest.