Leading through uncertainty

James Woodfall shares Insights from psychology and emotional intelligence

 

Uncertainty is part of every leader’s reality, whether navigating shifting markets, disruptive technologies, regulatory changes, or organisational transformation. And yet, few are taught how to manage the emotional impact of uncertainty on themselves or their teams.

 

Understanding the psychology behind our reactions and learning to apply emotional intelligence tools can turn uncertainty from a threat into a space for opportunity and growth.

 

 

Why uncertainty feels so difficult

Jeffrey Gray’s influential work on the neuropsychology of anxiety offers a valuable lens for understanding why uncertainty causes an emotional reaction. He proposed that two systems, the Behavioural Activation System (BAS) and the Behavioural Inhibition System (BIS), operate in tandem. The BAS drives us toward goals, rewards, and action. The BIS, in contrast, is wired to detect risks and signal caution.

 

According to Grey’s work, when we perceive threats to be present whilst in pursuit of our objectives, it creates conflict between the two systems. We want to make progress, but are worried about the consequences. This is the condition which causes anxious feelings to arise. One of the ways we perceive risk is via uncertainty. In moments of uncertainty, the BIS becomes hyperactive, perceiving unknown outcomes as potential threats.

 

Meanwhile, the BAS may still push for progress or opportunity. This internal conflict creates anxiety. Leaders might find themselves alternating between action and caution, fuelled not by poor judgment, but by conflicting neural signals.

 

Here’s an example of how this works: A CEO preparing to restructure operations amid uncertain supply chains may feel the drive to seize competitive advantage (BAS), but simultaneously be haunted by fears of failure or backlash (BIS) - the result: delay, indecision, and mounting stress.

 

Understanding this internal battle helps leaders normalise their reactions and re-engage their decision-making faculties with greater self-awareness. Once you know more about how the brain works, you can appraise situations and ask yourself, ‘Where am I perceiving a threat?’ and ‘Is it due to uncertainty, and what can I do about that?’

 

 

The present self vs future self gap

Another layer comes from behavioural psychology: we relate to our future self almost like a stranger. The further away a decision’s consequences seem, the more uncertain and anxiety-inducing they become. Time is another condition that contributes to uncertainty. The further away from the present the future is, the more variables apply, or to look at it another way, the more uncertain it is. This disconnect often fuels procrastination or over-analysis.

 

This leadership example illustrates its application: Imagine you are planning a three-year transformation strategy that is inherently riddled with unknowns, such as market trends, talent dynamics, and technological shifts. Without clear stepping stones, the future feels abstract and unmanageable. Leaders may feel overwhelmed or lack the confidence to act.           

 

To counter this, shorten the psychological distance. Translate long-term goals into short-term action plans. Make the future feel concrete by identifying immediate, achievable milestones.

 

 

Reducing uncertainty: practical strategies

You can’t eliminate uncertainty, but you can make it more manageable. This starts with creating clarity where possible.

 

To reduce uncertainty, start by clarifying what you know and what you don’t. Mapping knowns and unknowns using a simple 2x2 grid (certain vs uncertain, within vs outside your control) can illuminate where your attention and resources are best placed. From there, engage in scenario thinking: outline best-case, worst-case, and most likely outcomes, then build flexible plans around each.

 

A particularly effective method here is the pre-mortem, a mental simulation where you imagine the project has failed and ask, “What went wrong?” This helps uncover hidden obstacles and assumptions, allowing you to plan around them and reduce the ambiguity they create. Replace rigid plans with contingency frameworks, so that “if this happens, we do that.” Finally, anchor in the present. Break complex decisions into manageable steps and focus on the next right move, rather than the entire journey. Use rolling 30- or 90-day planning windows to stay responsive without losing sight of the long term.

 

In practice, reducing uncertainty may involve a combination of scenario planning to identify risks and plan for them, as well as uncovering new information to ensure that any assumptions are challenged.

 

 

Emotional intelligence as a core strategy

Emotional intelligence provides leaders with useful tools to navigate uncertainty, not by eliminating ambiguity, but by enhancing their response to it. Emotional intelligence is the ability to recognise and manage emotions in ourselves and others, and is composed of four quadrants: self-awareness, self-management, social awareness, and social influence.

 

Self-awareness enables leaders to recognise when uncertainty is triggering emotional responses, such as anxiety or frustration. By identifying these reactions early, leaders can prevent emotions from driving decision-making.

 

From there, self-management techniques come into play. Cognitive reframing helps shift perspective, turning ambiguity from a threat into a challenge or opportunity. Grounding techniques, such as deep breathing or mindful pauses, can help regulate the physiological symptoms of stress and enable us to think more clearly. Breaking larger tasks into smaller, manageable actions can also reduce overwhelm and restore a sense of control.

 

The goal of emotional intelligence is not to eliminate emotional responses to uncertainty, but to become skilled at noticing them and managing them, so that you can lead effectively under pressure.

 

Teams look to leaders for behavioural cues, and our emotional reactions leak through our verbal and non-verbal behaviour. If you’re anxious or worried, they mirror that. But if you demonstrate calm reflection, adaptability, and a willingness to make informed decisions despite incomplete data, you permit others to do the same.

 

 

Uncertainty: an opportunity to learn

Rather than viewing uncertainty as a leadership threat, see it as an opportunity to learn more about potential risks. If you feel anxious, trust your gut and take action to uncover risks and plan for them. We have emotions for a reason, and it’s worthwhile listening to them. By listening and taking the time to prepare, you may find you create more robust plans as a result.

 

Understanding the neural drivers of anxiety, the psychological disconnect with our future selves, and the power of emotional intelligence tools gives leaders a tangible advantage.

 

In complex environments, the most valuable leaders aren’t those who promise certainty; they’re the ones who demonstrate self-awareness and adaptability in the face of the unknown. 

 

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James Woodfall is a highly experienced former financial planner and author of The Heart of Finance who, as founder of Raise Your EI, now works with financial services and firms consulting on how they can use emotional intelligence to improve individual and company performance.

 

Main image courtesy of iStockPhoto.com and Marco Rosario Venturini Autieri