The Power of Paradox

Harness the Energy of Competing Ideas to Uncover Radically Innovative Solutions

Deborah Schroeder-Saulnier

• Publisher: Career Press
• Year: 2014
• ISBN:
  9781601634740
• Topic: Business
• Subtopic: Business General
• Index: Business

We're so often faced with apparent paradoxes: continuity and change, conservatism and progressiveness, predictability and chaos. In business, inherent tensions are mistakenly viewed as problems to be resolved once the "correct" answer is found. But when we consider only one direction—either A or B—we only see part of the picture. The strongest and most innovative solutions are frequently realized not through either/or decisionmaking, but by pursuing two contrasting options at the same time.Taking readers through the same steps she's used to help Fortune 500 companies such as Scottrade, Georgia-Pacific, and Boeing, Deborah Schroeder-Saulnier reveals a dynamic critical-thinking process anyone can use to define the strategic tensions within his or her organization, identify the potential of seemingly conflicting options, and develop action steps to maximize the benefits of each.Complete with examples of companies that achieved a competitive advantage with this breakthrough strategy, The Power of Paradox will help you face chronic challenges with confidence and uncover unexpected and infinitely better solutions.

PART I

The Process: Unleashing the Power of Paradox

Chapter 1

Paradox Thinking: What Is It and Why Use It?

“The test of a first-rate intelligence is
the ability to hold two opposed ideas
in the mind at the same time, and still
retain the ability to function.”

—F. Scott Fitzgerald, The Crack-Up

My new client had a lot on the line. It was no longer the golden years in which companies like his could hold on to the status quo and make profits. Money was tight, and he was feeling intense pressure to make changes that would boost profits immediately.

He started our first meeting with a story I’d heard many times before: “We’re struggling. We need to cut costs, but if we don’t invest in growth opportunities, the company will wither away.”

“Let’s look at the challenge through a different lens,” I suggested. “There’s no law that says you have to cut costs or invest in growth, is there?”

He laughed, “Maybe a law of business.”

I told him a law like that was meant to be broken. And then I wrote the words “cut costs” on the left side of a paper and “invest in growth” on the right side. Between them, I wrote the word “and.”

Cut costs and invest in growth.

“How is that possible?” he wondered.

“We’re about to figure that out!”

Welcome to paradox thinking.

Definition and Benefits

Paradox thinking is “and” thinking. It is thinking that identifies pairs of opposites and determines how they are interdependent relative to a key goal. In the previous example, the pair of opposites is “cut costs and invest in growth.” They are interdependent because both are vital in achieving the goal of a thriving organization. Failure to manage the pair of opposites may result in the company going out of business; at the very least, it will result in its slow decline.

Paradox thinking enables balanced management of conflicting objectives. A company wants to be known for innovation at the same time customers embrace it for its stability, to thrill shareholders with strong short-term revenue results and concurrently take actions to ensure long-term health. From those two examples alone, it should be easy to see how failure to manage a critical pair of opposites results in the company stumbling and, perhaps, failing.

Adopting an appreciation for paradox ends the practice of viewing conflicting needs separately and addressing one over the other. Paradox thinking unravels the assumption that, if we analyze a situation thoroughly, one option will trump another in terms of problem-solving. Organizations do not reach their potential when they habitually use that kind of either/or approach to challenges. Their profit, morale, and ability to innovate suffer. Renowned playwright George Bernard Shaw addressed what it takes to make progress when he said, “The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.”¹

Paradox thinking supplements the type of thinking many consider natural. So if you are a linear thinker, for example, you won’t stop being a linear thinker and suddenly transform into a complete paradox thinker by reading this book. A linear thinker might look at the challenge of employee performance management like this: “First I will point out the employee’s shortfalls, and then I will praise him for his accomplishments.” The solution to the employee management problem is a step-by-step progression involving critique and reward—but the linear thinker wouldn’t necessarily see critique and reward as a pair of interdependent opposites.

To that linear pattern, therefore, paradox thinking adds another way of looking at options and goals. It means looking at the divergent needs for critique and reward as linked and necessary in pursuing the goal of effective performance management. In other words, paradox thinking adds a level of understanding of the challenge, the ways to address it, and what the intended outcome is. In this example, once the linear thinker makes the connection between critique and reward, and consciously manages both to help the employee improve performance, he establishes an environment for faster behavior change and helps employees hit higher performance levels.

When paradox thinking becomes part of your problem-solving strategy, it has another benefit. It alerts you to when you are over-focusing on one part of the pair at the neglect of the other. That is, it helps your management of issues and actions stay balanced. In the performance management situation, it’s possible that you may want focus on the reward more than the critique, of course. Doing that deliberately and keeping in touch with the outcomes of that action will help you in the future. But if you are unaware of that emphasis on reward over critique, then you may have just created a problem for yourself.

Paradox in the Language of Business

Many business-related concepts suggest opposing needs. For example, customer service implies the “push” of providing something to customers and the “pull” of finding out what the customer wants. Contract negotiation entails dual requirements: to listen/pay attention and talk/demand attention. More than any others, however, two elements stand out as embodying multiple, significant paradoxes: innovation and leadership.

In a business context, innovations tend to involve imagination and logic, a focus on what’s different and what’s familiar, being practical and stretching for the incredible, and many more interdependent opposites. Michael S. Dobson, author of Creative Project Management among other engaging business books, told me this story of innovation from early in his career:

I was at the toy fair with my boss, looking around the show floor for the next big thing. This was the year the Cabbage Patch Kids became a fad. We were in some Hong Kong importer’s show room and they were selling Broccoli Patch Kids. They were a terrible knockoff. I made some disparaging remarks about them and my boss said, “You have to understand that it’s not bad that it’s a knockoff. It’s just a dumb knockoff. There is a brilliant Cabbage Patch knockoff at this show. See if you can find it.”

I looked around for hours and didn’t see anything that fit his description. At the end of the day, he said, “What is the Cabbage Patch gimmick?”

That much I knew: “You adopt them.”

“What else do you adopt?”

That was a gigantic clue. The brilliant Cabbage Patch knockoff at that year’s toy fair was Pound Puppies. They are exactly like Cabbage Patch dolls, but completely different.

The ideal toy is brand new, completely original and just like everything else.

The paradox Dobson discovered applies to any company that tries to innovate, from toothpaste to smartphones. Integrating such paradox thinking into to new product development creates the kind of competitive advantage that companies profiled throughout this book enjoy.

In addition to innovation, leadership embodies myriad conflicting needs, such as confidence and humility, control and empowerment, grounded and visionary. Reinsurance Group of America (RGA) experienced major structural changes in 2008 and then again 2011. Because of these changes, new leadership paradoxes took shape for CEO Greig Woodring. Once owned by Metropolitan Life Insurance, RGA split off from MetLife in 2008 after expanding its global presence by adding new foreign offices. Then in 2011, it became a matrix organization and started to move toward more integrated systems instead of running like a loosely affiliated group of reinsurance companies. Control and empowerment emerged as central conflicting needs in his changing world. By exercising too much control, he could quash the entrepreneurial spirit of the individual company leaders. By empowering them too much, he would undermine the moves toward more coordinated behavio...