Wendy Smith - Both/And Thinking Part1

And I ended up framing it as a tension around, do I continue to do what I thought of as an amorphous world of leadership, practice, getting stuff done, which is something that I had done a lot of in high school, and then in college. Or do I study? Do I research? Do I become an academic? And those had very different career trajectories and felt like I had to make a very clear choice.

And then when I got into grad school and decided to do academia, it was, do I study innovation, which I know you speak a lot about and tensions and innovation. Or do I study social responsibility, which is what was bubbling up as a hot issue at the time but was still novel and that felt like an either or. And so in the language that we use , both of those spurred on for me a question of not just what are these challenges, but how did I think about these challenges?

We use the word tension to describe the overall experience of this tug of war between these opposing pressures as an overarching comment. And they show up for us as a dilemma. And we use the word dilemma to think about this trade off that we have these Alternative opposing positions, and we feel like we have to make a choice between them. So in the first case, there was a very clear choice. What is the career path I'm going to follow?

Am I going to go to grad school and get an MBA or a law degree or something in which I'm going to go into practice? Or am I going to go to grad school to get a PhD and go into academia? That was a very clear fork in the road that needed a decision. And that's the dilemma that we face and these dilemmas show up and feel like this either or and they feel like once we are making that decision, the dilemma is resolved. And what we argue is that underlying each of those dilemmas.

is a pattern to those decisions that we label as draw on use the word paradox. And I say draw on because we are drawing on 2500 years of history around this word. And the idea is that underneath those dilemmas are competing ideas, opposing ideas that are both in our heads. opposition, but they are also interdependent with one another. They reinforce, they define each other.

And we use the symbol of the yin yang to represent that idea of paradox, because you could imagine these opposing perspectives, white and black, But those perspectives reinforce each other.

And so in my own decision, underlying this question of do I go to grad school to get a PhD or do I go to grad school to get an MBA or something that is more pragmatic, underlying that decision is an ongoing tension that I experienced of wanting to both do stuff, get stuff done, lead, but also and also understand, research, do it.

And so If we look at that paradox, there's this paradox between understanding and doing, learning and developing, being and doing, and our argument in the book is that if we can notice the underlying paradoxes that inform our dilemmas, it opens up a whole new way of thinking about how to address and respond to them.

There was a piece here i'd love to quote because i just wanted to show people the beautiful language. You mentioned Yin and Yang for example you go into the history including showing how that image works and all the different nuances about that image which is beautiful but there's a piece here i'd love you to unpack for us you say.

"What if instead of trying to choose between the mutually exclusive options we start by surfacing the paradoxes that lurk beneath our dilemmas and recognize that those paradoxes cannot be solved. Instead of choosing between alternative poles of paradox what if we ask a different question how we might engage both poles simultaneously." i'd love you to unpack that because really this is the main thesis of the book both and thinking

In fact,, not only is it not a problem, it can be an opportunity, a chance to move forward. And so, just by way of example, I think I was saying , I initially studied innovation and the key question for these business leaders was do I focus on the existing world? Or do I focus on the new, innovative, experimental world? And as your listeners know, there's resource questions associated with that. There's leadership questions associated with that. There's strategic questions.

There's, questions of identity. There's questions that feel like you need to make a choice between them. The invitation of paradox is to notice that instead of pushing for a clear choice immediately. The invitation is to sit with and notice how it is, why it is that the existing world enables, creates resources, enables supports, The potential to innovate. The more successful you are, the more that you have resources to be able to experiment and create the slack to try new things.

The innovative world enables us to actually continue on going forward. It creates energy and ideas that prevent us from becoming obsolete . And so it is that initial noticing that there are these underlying paradoxes that invite us into this new way of thinking.

I'd love you to unpack those, but again, there's a beautiful piece here. And you can tell that Wendy studied innovation, when you read little excerpts like this. You write that, "the greater the rate of change, the quicker the future becomes the present, and the more we must grapple with tensions between today and tomorrow, the scarcer the resources, the more we fight for our slice of the pie, revealing tensions between self and other.

Between competition and corporation which speaks to disasters from a climate perspective to unbelievable focus on the bottom line like Enron so much in here but this idea of timing is an underlying foundation

How am I going to spend my time? And if underlying that is the paradox that it is a different lens on that. What we would argue then is that paradoxes inform and define all of our dilemmas, but they're not always salient. We don't always always. Experience them. Oftentimes they are hidden in the shadows. So the question is what makes them more salient as opposed to latent and hiding. And those three conditions that you named change, plurality and scarcity.

What we argue is that it is those three conditions that make this underlying that that juxtapose the opposing perspectives so much more poignantly, and you're the first is to your point, Yeah. That change is about timing. It's about how quickly we condense or the experience of tomorrow becoming today. And that creates this tension between the today and the tomorrow in a much more poignant way.

I think that Aidan, we're seeing that now in issues of climate change, as you said, or issues of large global issues where the question about what tomorrow will look like feels very different for Our generation for my kids generation than what today looks like, and it's creating all kinds of clashes between that tomorrow and today, which invites us in which demands us to experience that tension more poignantly.

The second is this notion of plurality that when we are When we're surrounded by lots of people that think like us, that tensions or opposing perspectives don't surface that often. When we are surrounded by lots of people that have different points of view, on one hand, there is this opportunity for creativity. And on the other hand, we experience that tension even more. And in fact, And we can talk about this. The call that I just got off.

It was all about polarization and the extent to which we're surrounded by people with different points of view. And instead of leaning into and valuing those different points of view, we have gone to a place where we have basically gone to our different corners and hidden away and then shot out at one another because we don't know how to be in conversation around that. But that plurality surfaces these tensions.

And then the third piece is The extent to which there are limited resources creates challenges over who gets the resources and it surfaces those tensions and makes them more explicit, salient and obvious to us

Beautifully peppered with loads and loads of examples from personal reinvention, to great innovators, to people who have reinvented their origins. So this is a great story that you open the book of Zita Cobb. And I thought we'd open the show with her as the example as well, because I loved her story. Great lady, brilliant thinker. And she applied both on thinking to solve a really tough problem that she was struggling with

And if you travel to Fogo Island and you climb that hill there, there is a lovely sign there that says this is one of the four corners of the earth. Watch out. And then it notes at the bottom the number of people that have fallen off the earth from here. Zero. So, so they live into it. But the bigger story is that Fogo Island is an island that was inhabited for about eight generations.

Mostly Irish, British, Scottish settlers came over about eight generations ago and predominantly develop their main resource is cod. They were fishermen that would day fish in these small punt boats off of the coast of Fogo Island for, for centuries. And that in the 1970s when the large trawling boats from Scandinavia would come out and would fish the open waters, it really dried up the cod stock.

In the inshore co stock, which meant that the livelihood in Fogo Island was starting to, was diminishing significantly. And then in the 1990s, the province basically put a moratorium on the amount of fishing because there was such a small resource left and many people left and moved. And the people of Foggo Island, many people had left, including Zita Cobb.

She moved to Ottawa and it turns out that she went and got an MBA got involved in the semiconductor sorry, network networking industry became very successful and became the third largest paid third highest paid female executive in Canada. And then when she cashed out, I believe in her. 40s or 50s said, like, how can I do something with this? That is meaningful. And what was really meaningful to her?

What is really meaningful to her is Fogo Island, where she grew up and had to abandon, but not just Fogo Island, Fogo Island as an island. Emblematic as a symbol more broadly of small rural communities and the fact that we were losing the diversity of small rural communities of cultural distinctions of different ways of knowing so she went back to Fogo Island to ask, how can we redevelop Fogo Island? and develop this, this island and a huge challenge there.

So there was a huge challenge of, well, what does it mean to honor the traditions and the culture and the ways of life and the ways of knowing and simultaneously modernize this island so that it can continue to exist. It can continue. There could continue to be an economic possibility into the future. So how do we deal with this ongoing tension between the old and the new, the tradition and the modern, between that which is local and unique and connecting into the global economy?

How do we, how do we navigate those tensions in order to be able to survive? As an island and continue to be unique, even while connecting into that global economy.

Where your success can lead to your failure if you cling to the way things were always done around here and this is where both and thinking comes in. The book covers a deep dive in the history of paradox which stems right back to the dawn of writing the duality that. Heraclitus talked about Jung talked about but i wanted to zoom in on one particular diagram here because you discussed the four types of paradox.

And I thought that would be really useful if we set up today's show with the frameworks through which you can listen to the rest, because we're going to do part two and part three, let's share this Wendy, and I'd love you to take us through this Diagram.

That's the tension of short term, long term tradition, and we see that in this social enterprise and trying to rebuild this rural community in the future. Newfoundland, and I just spent six months in Australia, did some work with some schools and these schools were dealing with, the other corner of the earth and these schools at a very different industry. We're dealing with the same tension. How do we navigate the tensions of who we've been while simultaneously building out who we are?

We want to be and how do we hold on to our traditions while still modernizing and, in these schools, as you can imagine, as soon as you say, Oh, we've got to change things. We've got to innovate. We've got to modernize. All of a sudden there's an anxiety. Don't let go of our tradition. So you could feel that there. That is the learning paradoxes. Just to walk through the others. Performing paradoxes are indeed these tensions of outcomes of what we're trying to achieve.

We call it the tensions of why the example we often use is this mission market profit passion, which a lot of organizations experience for Zita Cobb. This was true and present there for her, which is the tension between how are we going to enable our economy and build out something that develops the economy. And we can talk about how she did it and know that that's in service of building out and developing our community.

We, we like to use we, and in the book, we use the example of Unilever, which is a often some of your listeners might know the example, the at the time Dutch British owned packaged goods company where Paul Pullman came in in 2008 and made a very clear commitment to the Unilever sustainable living plan, which committed to a set of social and environmental objectives, not despite, not alongside, but to enable. their financial bottom line, their profits. So that's the performing tensions.

I can tell you just briefly about the other two. The organizing tensions are what happen when we create processes, when we are trying to figure out how to get something done in organizations. This shows up as the tension between do we focus on centralization in an organization or decentralization. I am at a university.

Our university, as many others, continually struggle with, is there central decision making or do we enable sort of decentralization where other people get to inform and enable decisions? Where do decisions happen? I worked with a hedge fund in Hong Kong, and that was a big question they were asking, which is, Who makes the decisions here? Is it in the Hong Kong office or is it all in all these distinct offices across Southeast Asia where they had very different cultures?

And then belonging paradoxes. And this is often the one that people find most abstract, but these are the tensions of who we are, our identities, how we understand ourselves. Do we understand ourselves as distinct identity groups, or do we understand ourselves as part of a greater whole? Do we understand ourselves as insiders or outsiders? And this set of tensions, who we are and how we relate is probably the most poignant when it comes to our decision making.

In fact, several of the conversations, I think I was saying, I was talking about polarization. This comes up in the polarization conversation a whole lot. Or I just had a conversation with folks who are navigating tensions in the midst of conflict in the Middle East.

And what does it mean to for those that are connected to that to hold a particular point of view of trying to advance an identity, either Israeli or Palestinian, Jewish or Muslim, and at the same time, try and hold a more global identity of living into humanity and trying to create a global identity. connections across those, it's really hard. So those tensions are particularly pernicious.

I want to just say one more thing, which is that we think the value of this figure here is to help us, to your point initially, see how these tensions show up all over the place. They are so at present in our lives all over the place. We see these paradoxes everywhere. Sometimes people get stuck in saying, well, is my paradox in this bucket or in that bucket?

And to us, the value of these buckets is to inspire us to notice how prevalent these tensions are, but not that we have to figure out exactly which bucket they fit into.

And they're going to talk about exactly what Wendy's talking about here, this paradox of profit or planet, . So lots of good stuff to come on that. But a couple of the things you said there, like so many of our audience, like you have studied and you're a scholar in innovation, you will have seen this time and time again, the bureaucracy. And the burden of bureaucracy, but the need for some bureaucracy.

So this tug of war between centralized decentralized decision making from the top versus pushing decision making down the organization, there are huge paradoxes with inside organizations. And I'd love you to shed a bit of light on that from what you've seen that's successful, or what are the compromises that you need to make

He felt like the layers of decision making bureaucracy were so imposing that he just felt like shut out. And his wife, Viv Gore said, well, we could do something better. And they launched and developed W.L. Gore & Associates , and the company really took off when they developed this polymer that has this properties of flexibility and properties of durability that has now been built into everything from guitar strings to dental floss, to the jackets that military people wear.

, and the key to the company Was that they were going to build the company around the power of small teams. And the idea was that they were going to move the decision making down so that people could really lean into their creativity. They could feel motivated.

It was built off of a lot of McGregor's theory, X theory, Y, the idea that we can invest in people and that , they'll show up to the task and that if we give people the tools in order to really be creative and autonomous and motivated, they'll engage. And that was great in these small teams. When Gore was one office in Newark, Delaware with about 200 people and everybody knew everybody and they could navigate these possibilities.

And as Gore grew, It became challenging for these small teams to work together and about 50 years later, a little bit less the first non Gore family member. It's still a privately held company. Terry Kelly. I think she was the second. Actually, the first person was there for two years, took over as the CEO of Gore. And the issue for her was that these small teams were all great.

But they were all running around in so many different directions with so little coordination across them that there was no either economies of scale at the least. And at the best, there was no enterprise wide strategy. They couldn't coordinate with each other because they all had different processes and they had different practices and they weren't speaking the same language and they had different technologies that they were using.

And the question that she had to ask was, how do create, enable an enterprise wide strategy that did not ruin the culture of autonomy that came from the power of small teams. That was her both and challenge. And it was difficult.

And to go back to this point of identity, she faced a whole lot of pushback because people at Gore said, and continue to say, We are a company that is built on this autonomy and motivation and small teams, and as soon as you start talking enterprise wide strategy, you're killing that. And she would say back to them, in order to live, you need to breathe. And in order to breathe, you have to breathe in and breathe out.

So how do we create an organization here where we can both have the kind of coordinated possibilities While simultaneously upholding our culture of autonomy and small teams.

So when it comes to group, the idea of in group, out group, we do this a lot, people in innovation, when they're working in organizations, create this divide and go, Oh, they're dinosaurs. Those guys, they don't understand that they're going to kill the organization, and in doing that, we create the divide, which is not helpful anymore. And one of the things you suggest we be aware of beyond the paradox is.

What you call the nested paradox, because you say from the individual to the group organization and society, that paradoxes show up at different levels, this is what you call nested paradoxes. I thought this was an important thing to share.

The first is what you're talking about, which is nested paradox, which is to say, the way that we experience the world is informed by our personal experience is informed by the groups that we are in. It's informed by our society. Our society is informed by the people that lead that society, and they reinforce each other. And so this idea of nested paradoxes is that how we experience these tensions. Like goes up and down across these different levels, and that has implications.

So one implication, for example, is that we need to be aware, that of the messages that we get from our society and how it informs our thinking. And it's hard to do that. So my colleague Josh Keller now in Australia had this piece of work that he did with his colleagues where he looked at the different messages that we get. If we're living in China and the national messages around what it's like to live into competing demands or living in the United States.

And he did this great study where he invited people in China to look at game theory. Can you cooperate and compete, or do you have to choose cooperating or competing? And it turns out that in the United States, people don't think that cooperation and competition can go together. You have to either choose to cooperate or compete. In China, the national myth, the national story, the national zeitgeist enabled a possibility for cooperation and competition to happen more simultaneously.

What I love about the finding, however, is that they found that was true in China, except for those people in the business schools in which they started to adopt and embrace this American Approach that cooperation competition can't go together and they have to be one or the other. So there's something about the way in which our national stories inform our individual thinking that we're not always aware of.

And here I love a phrase from Zita Cobb, who we mentioned, who always says, fish don't know that they're swimming in water. It's a, it's a well known idea. I tried to look up who initially said it. It's attributed to lots of people. But the idea that, how we think about the world being informed by our society, we don't even know. And so how we think about these tensions informed by our society, we don't even realize, but that they cascade across these different levels.

And so that's the idea of nested tensions.

And being stuck in ways of thinking, et cetera, et cetera is the paradox system. I thought we'd share that when the, and this is where, if you look at this system, those of you joining us on YouTube, you'll see how to enable both on thinking and throughout the book, there's multiple frameworks like this to help you.

It's really a decision making book helps people make better decisions and helps you navigate your life better helps you make better personal decisions but also if you're an organizational leader, be able to navigate big thorny issues as well so i'm gonna share on the screen the paradox system i love you to take us through,

We identify four buckets or what we call sets of tools for navigating the both and, and we point to and we worked really hard to label them as A, B, C, D, maybe to help with the mnemonics, assumptions, boundaries, comfort, and dynamics. And here's, what's important about this. Okay. idea is that we also put them on two different axes. So on one hand, on the horizontal axis, we point to assumptions, which is our mindsets. How do we think about these competing demands?

And on the other side, comfort, Which is our emotions. Aiden, you said earlier, these things are really hard and we make a case for, and we can unpack how to do this, but that in order to navigate paradoxes, we have to notice that discomfort, notice how hard it is and find comfort in the discomfort. So the horizontal access is both head and heart, mind and emotion cognitive, rational and emotional, intuitive. And that's all about what the individual does.

On the vertical axis we have boundaries and dynamics. Those are both about how do we scaffold the system around us to reinforce the both and whether it's in our personal lives or whether it's in a group or whether it's in an organization. The boundaries, which is often the most confusing, but really that's the structures that we create to scaffold are both ending. It's, it's the vision that we set up. It's the rules. It's the roles and responsibilities.

It's the processes that we put in place to reinforce both ending. And we can talk more about what each of those look like. And, and those are like the set structures. And then at the bottom, it's the dynamics, which is the practices we put in place to allow us to continually change to invite us to constantly be curious to shift to look for opportunities to experiment to not be stuck. And so what are the practices that create the scaffolding that is more stuck?

And what are the practices that create the possibilities that enable us to change the stability and the change? And I just want to say in the big picture. That some of your listeners might be noticing that in each of these axes, tensions within them. And so there's the tension on the horizontal axis between how I think and how I feel, which are, the mind and the heart, which are often in tension.

There's the tension on the vertical axis between the things that we do in our systems that are stable and the things that we do in our systems that enable change, stability and change. And then we have a tension across axes, which is about, and by the way, this tension comes up all the time, which is about changing the individual, which is the horizontal axis or, and changing the system, which is the vertical axis. This is the individual and the system structure and agency and academic language.

And a key to this And the big picture is that we say multiple times throughout the book that if this is how we navigate paradox, then notice there's paradox embedded in it or navigating paradox is paradoxical, and so people could lean into this figure to notice how notice those paradoxes and navigating paradox or lean in and focus in on one of these sets of tools and the tools to enable, and we would argue that they actually reinforce one another.

I was trying to teach him the importance of decisions and decision trees and that each decision opens up more decisions and when i saw this i was like well, this is essentially an infinity curve of you make that decision then you need more decisions and it just it's never over which is life and if you can create good frameworks to make a decision in the first place.

You just feel more comfortable i think in life you go through life happier you don't have as many regrets you know you made the best possible decision you could with the tools you have available so it's one of the reasons i love the book and highly recommend it but i thought we'd move on to ruts and.

You open chapter two with story of lego and many people think LEGO's always been an extremely successful company not knowing the history about lego but i got a few near death experiences, i'll open up a little quote here because you said stressing only one side of a paradox oversimplifies and narrows our options,

. The tricky thing is that picking one side usually offers us short term success, comfort, respect, rewards, efficiency, joy, success, motivates us to stick with that option until we get stuck in a rut, the greater the success of those either or choices, the deeper the ruts. Lego leaders. Learn this all too well as their commitment to the organization's greatest strengths nearly led to their downfall

And the idea is that, as you were saying, we pick one side, we get, we reinforce that side with expertise, skills, people, both our social structures around us, our identity, that it's hard to then pull out and see the other option. And this, to your point, as many of your listeners will know, is the challenge of the S curve. You build up, in a company, for example. You become so adept at one, particular approach, you build up your success.

You create the scale around that you move up the S curve, but you're so successful that you don't know that you're about to fall off the S curve. And it's a classic challenge for companies. And Lego fell into that. They, were a family owned business. Started in Billund, Denmark. They came upon this brilliant toy of the interlocking brick. They really had it down pat so that They resisted innovation significantly, and they were four colors for a very long time.

And there's these stories about how George Lucas and the Star Wars team came and said, Let's co brand. No, no, no. We're not about, creating Systems that tells kids what to do with their Legos were about so so they really resisted and like many companies They began to fail And we see that story again and again. And that is the story of falling into the rabbit hole of inertia, of intensification.

And that happens whether it's innovation or that happens whether we are intensifying around our skills and approaches to our job. We are in a career. We have a way of doing things. We are surrounded by other people that do it the same. It's really hard to change. So we intensify, we fall into a rabbit hole and it's hard to see the other side and. And as you noted that's not actually what almost killed Lego because they brilliantly said, Oh, they finally realized, , they were the toy of the year.

They were so successful, but then they started to see this decline and much of the decline happened because the toy industry was starting to become much more electronic and not as mechanical. And they said, yeah, we've got to innovate. And so they did what we often see, when people start realizing they have to switch, which is they moved significantly into the opposite direction and started to innovate in every possible way. So we call this The wrecking ball or overcorrection.

You go from intensification to overcorrection when you switch into the complete opposite. And so that's when Lego opened up , Lego lands and all of these parks, or that's when they started co branding with everybody. There was just a whole lot of innovation.

They. tried every type of innovation and they were so innovative without restraint, without discipline, that it's then that even though their profits, their top line started to go up, their bottom line started to decline because their costs were so out of control. And they realized that they have to move to a different kind of innovation that is both innovative and with some discipline and with some limitations along the way.

So that is the second sort of pattern that becomes problematic in the either or. We move from one side and we swing to the opposite. And again, we see this in our personal lives. I always say, If anybody wants to see this in their personal life, think about anybody who's ever been on a diet or tried to be disciplined about exercise or disciplined about something. Discipline, discipline, discipline, discipline. And then as soon as you give it up, forget it.

Like, you eat the chocolate croissant and everything goes out the window. So we have these swings. And then the third pattern, and I don't know, I can say two words about that and then we can unpack any of those, but the third pattern is perhaps what I think of as the most pernicious, and we call that trench warfare, and we've referred to this a bit over in our conversation, and it's essentially what we point to as polarization, right? We have intensification. We have overcorrection.

We have polarization. And it's what happens when we pick a side. We surround ourselves with other people that pick, that reinforce that, the confirmation bias. And then we reject, we defend our side and we reject to the point of dehumanization the other side. We don't even know what it looks like at some point, but we just keep rejecting it because the assumption is, if I'm right, I'm right.

They have to be wrong, and we call it trench warfare because you could imagine the idea of one side building a trench to protect themselves and surround themselves with other people, but then shooting out at the other side without even knowing who they are, without even hearing their opinion, without even understanding.

And that, as we've said a couple of times, that comes up in companies, I did a talk a little bit ago for a group of CFOs who said, yes, like as CFOs, we totally like sustainability is really important. And then when we started to talk about those sustainability guys and how irresponsible they are about money and like, it just became us and them.

And they don't, they don't have conversation, but so we see these kind of polarizing groups show up in organizations, and we certainly see it in our global politics at the moment.

There's a lot in that in biases and beliefs and how we are educated what first managers we have etc but i love you to share maybe a sweeping thought on that because this is where it all forms for us and it can be very difficult to rewire ourselves.

We want clarity and certainty, and we feel anxious when things are uncertain. And I Often like reminding people to go back to March, 2020, the beginning of the pandemic, when there was a lot of uncertainty, that uncertainty was highly consequential, potentially fatal. And what we most desperately wanted was certainty and clarity. Should we mask or not mask? Should we, should, should we isolate or not isolate? Should we wash our fruits and vegetables five times or seven times?

Like we, we wanted real. Clarity on things that there weren't always real clarity about. And so just to remind ourselves how quickly we go to those places of wanting to have a clear decision because we feel uncomfortable and that shows up all the time. And I have tremendous. Empathy for how we navigate that, but that's not easy.