Leading in Paradoxes

Leadership in the corporate world often involves making difficult choices. There are simpler and linear decisions (at Amazon famously known as two-way-doors) such as, where to invest? Offer luxury or commodity? Incentivise individuals or teams? While such decisions require attention and careful considerations, but are fairly straightforward. Then there are the really hard choices (the one-way doors) that leaders have to also make, that are seemingly contradictory in nature and complex, situations that can only be resolved by recognising the interdependence of opposing elements. For example, leaders are encouraged to be authentic, but this can conflict with the need to adapt to changing circumstances. These are ‘contradictions’ or ‘paradoxes’. One of the more popular examples of paradox is the Socratic statement “I know that I know nothing.”

Paradoxes are "persistent, interdependent contradictions," according to business scholars Wendy K. Smith and Marianne W. Lewis, who define them in their book "Both/And Thinking." The very idea of an organization has a paradox at its heart, as it contains "free, creative, independent human subjects" that must also operate within an "organization, order, and control."

In a recent MIT Sloan Management Review article, clinical professor Scott D. Anthony at the Tuck School of Business provides valuable insights on paradox. He discusses how innovation is acutely paradoxical. To resolve Clayton Christensen's famous "innovator's dilemma," you need to both listen to and ignore your best customers. Modern leaders also face the paradox of creating inclusive and empowering work environments while also building a unique work culture that hires people of certain types and aptitude.

Anthony further adds that paradoxes are "complex, adaptive, system-level issues with rampant uncertainty." This is why the "innovator's dilemma" has proven so stubborn despite two decades of work by practitioners and thought leaders. Humans also suffer from predictable biases and blind spots that make pursuing "both/and" solutions challenging. Confirmation bias, loss aversion, and the status quo bias all contribute to this difficulty. Hierarchy and groupthink further complicate the task of navigating complex paradoxes.

To solve paradoxical problems, Anthony offers four techniques that leaders can use:

1. Shift perspectives: Look at the problem from different angles to find new solutions. A law firm that was struggling to innovate because it was too focused on past precedent held a paradox sparring session to discuss how to both let go of and retain control. This led to specific solutions, such as alignment around goals and degrees of freedom for teams, more regular dialogue between managers and teams, and focused investment to teach teams how to solve problems.
2. Adopt a paradox mindset: Be comfortable with ambiguity and contradiction. An executive who helped to launch two billion-dollar businesses said that finding a "point off the line" (data that didn't conform to expectations) was exciting because it opened up the possibility of a new path to a solution.
3. Run thought experiments: Play with different possibilities to generate new ideas. Toyota showed that it was possible to make profitable products while still being environmentally friendly; Netflix showed that it was possible to be profitable without having strict rules and controls; Unilever showed that it was possible to be both sustainable and profitable.
4. Sparring sessions to practice: Like a boxer who uses sparring sessions to practice for form and response, a paradox sparring session is a purposeful place to bat around ideas and challenge assumptions. Lego held a series of sparring sessions to discuss the apparent tensions between developing people and meeting stringent production targets.

Leaders can use four questions to assess whether a perceived paradox is real or illusory:

1. Is the perceived paradox truly a law of nature, or a difficult choice?
2. Am I imposing a constraint that is creating the perceived paradox?
3. Am I hesitating to act because the perceived paradox is the result of the system I helped to construct, perpetuate, and potentially benefit from?
4. Does a different frame reveal the paradox as an illusion?

While tackling perceived paradoxes presents challenges and requires work, these paradoxes can be dissected and transcended, turning helplessness into empowerment. By embracing paradox and making the "paradox choice" to turn "either/ors" into "both/ands," leaders can create new possibilities and achieve remarkable results.