Posted April 29, 2016 Leadership by Wendy K. Smith, Ph.D.
Great organizations don’t just survive – they thrive. Today’s accomplishments catapult tomorrow’s successes. Local achievements build toward a global triumph. Energized employees and enthusiastic clients spark financial successes.
The problem is that most organizations don’t thrive – many don’t even survive. Instead they become mired in ongoing conflicts, tensions and challenges that leave them stuck trying to move forward, which can ultimately result in decline and demise. Efforts for today constantly compete with experiments for tomorrow. Local initiatives are completely at odds with global integration.
Three Universal Paradoxes
These organizations are stuck because they cannot manage paradoxes – persistent interdependent contradictions. We’ve identified three critical paradoxes experienced by all organizations:
- Innovation Paradoxes – time tensions between today and tomorrow, short-term and long-term, innovations and existing products
- Globalization Paradoxes – space tensions between global and local, centralization and decentralization, headquarters and subsidiaries
- Obligation Paradoxes – focus tensions between social and financial, mission and markets, passion and profits, shareholders and stakeholders
Most leaders manage these paradoxes poorly. Faced with competing demands, they feel the need to ‘resolve’ the tensions, making an either/or choice for one option. However, doing so only creates more energy for the alternative option, triggering an ongoing vicious cycle. Overemphasizing today’s needs means devastation when it becomes impossible to adapt to tomorrow. Stress local distinction and flare, and it becomes a Herculean task to integrate, collaborate, and gain any kinds of economies of scale. Focus on finances and profits at the expense of all else, and you risk losing it all.
In our research with companies over the last 20 years, we have developed an alternative model showing leaders how to embrace, rather than solve, paradoxes. The model involves changing your leadership approach as well as shifting your organization’s practices.
From Either/Or to Both/And Leadership
Effectively engaging paradoxes begins with shifting leaders’ mindsets. We have identified three key assumptions that shift from an either/or to a both/and approach.
- From consistency to consistent inconsistency – Either/or approaches involve assuming a Truth in the world, and we need to identify that truth and then stick with it. These approaches include valuing clear decisions and consistent commitment to those choices. In contrast, both/and approaches involve assuming that there are multiple truths in the world, and our goal is to embrace them. Doing so involves relaxing assumptions of consistency, and being consistently inconsistent – being willing to quickly juggle between alternatives.
- From scarcity to abundance – Either/or approaches involve assuming that resources such as time, space, and money are scarce – a zero sum game. When alternative demands compete for resources, if one option gets the resources, the other doesn’t. Both/and approaches instead involve assuming that creative thinking can increase resource value, so that both options can benefit from working together.
- From control to coping – Either/or approaches involve discomfort in the face of uncertainty, and therefore use management as way of controlling that uncertainty. Doing so involves resolving tensions and conflicts. Both/and approaches involve being comfortable with uncertainty and vulnerability, which enables management to cope and live with the conflict and tensions.
Developing a Dynamic Organization
Effectively enabling the organization to engage paradoxes involves two practices – separating and connecting
- Separating – Separating involves practices, structures and cultures that distinguish and honor each side of the paradox. In organizations, separating practices might include things like having a separate unit for innovation, creating a different balance sheet to account for social mission metrics, allowing local units to encourage distinct products and cultures. Separating practices also involve transparent communication about what is unique and valued in each agenda.
- Connecting – Connecting involves practices, structures and cultures that foster synergies and enable opposing elements to be in a dynamic, ongoing relationship. This begins with identifying a higher purpose – an overarching statement imbued with passion that integrates across all of these competing tensions. Connecting also involves identifying individuals with roles for seeking synergies; developing improvisational practices that allow for more dynamic interactions to emerge, and generating ongoing conversations about connections.
These practices themselves are paradoxical – they are contradictory, yet are both necessary for success. Either one alone is limited. Separating without connecting pulls apart alternatives, but leads to greater conflict. Connecting without first separating leads to compromises where either the more powerful alternative takes over, or both alternatives gets compromised and no one is happy. Managing paradoxes is paradoxical.
What you can do:
- Diagnose your paradoxes – Are you finding that you are coming up against the same tensions again and again? Do the same challenges consistently reappear? Do you find that you are constantly debating at your headquarters about how you can integrate and work with all the distinct subsidiaries? Are you always trying to address whether to emphasize collaborative teamwork or competitive individual accomplishments? Are you struggling with trying to figure out how to be adaptive and innovative, but also maintain disciplined execution? If so, you are bumping up against paradoxical tensions that won’t ever go away. Identifying these paradoxes, and recognizing that these contradictory and interdependent demands persist over time is the first step in managing them.
- Investigate your own reactions – Do you think you need to make a decision that solves these tensions? Do you think you need to be consistent – that if you’ve made a decision at one point, you have to make the same decision again at another point? Does it seem like personal or organizational resources are limited and scarce? Do you feel uncomfortable with uncertainty or vulnerability? The next step is challenging your assumptions – investigating alternative assumptions.
- Develop your organization – Does your organization have a higher purpose that connects across multiple competing agendas? Do you have practices that allow you to clearly understand, respect and honor both today’s products and tomorrow’s innovations? Enterprise-wide connections and local distinct flavor? Social mission and financial outcomes? Do you have practices that allow you to connect between these options to be more adaptive? More improvisational? The final step is creating an organization that can sustain paradoxes over time.