Wednesday, April 20, 2016

CIO Master Tuning XII: The Art of Paradox Management

The paradox is the result of two opposing truths existing side by side, which can be both right.

In the current business environment with “VUCA” characteristics, uncertainty and ambiguity are a key challenge for business leaders today. In the past, many business leaders believed their organizations’ long-term goals are static, could wait until they had dealt with the current crisis, their strategy-execution are linear steps, and business innovation is a luxury, not a necessity for the majority of companies. But this is no longer the case. The rate of change has accelerated, indicating that business leaders must learn how to deal with the management paradox in varying circumstances, to manage strategy and execution as an iterative continuum, strike the right balance to keep the business flow and accelerate the digital transformation. Many thought the modern management is the art of paradox management.

  • The paradox of Strategy Management: The paradox is “a situation, person, or thing that combines contradictory features or qualities.” Strategy manifests the ‘AS IS” & “TO BE’ state of the organization. The paradox of Strategy Management is that there is on one side pressure to strategy to be holistic and comprehensive. On the other side, there are requirements to strategy to be simple and easy as the world becomes more dynamic because Digital means flow: the energy flow, the information flow, the idea flow and the mind flow, so the view of the business ecosystem needs to become more dynamic and more adjustable. To balance such paradox, it is resulting in the necessity to use many reference models and other accelerators. It also leads to splitting of digital strategy into layers with different level of information granularity, where upper layers are holistic (covering all concepts, such as enterprise ontology and vocabulary) and lower layers are comprehensive - covering all attributes needed but for selected concepts only. The blurring line of business border and the uncharted frontier of an organization provides both unprecedented opportunities and emergent risks, so in order to craft a living strategy, the management has to have the ability to ask the hard questions and engage in meaningful dialogue even if you do not agree with one another you can indeed agree to disagree yet, stay engaged with one another. Traditional strategy making is often top-down and single dimensional push. However, digital strategy is agiler, outside-in and bottom-up feedback and inclusiveness become crucial for handling the paradox of digital strategy management, prioritizing strategic goals, and enforcing effectiveness of strategy-making and implementation continuum.

  • Innovation Paradox: The paradox is the result of two opposing truths existing side by side, which can be both right. Business innovation has the characteristic of paradox, and often creativity is sparked by conflict. For example, from the business perspective, on one side, overly focus on efficiency could limit the creative potential of the business due to the limited resources invested in innovation, but improving business efficiency is always one of the important aspects to improve business maturity. If an organization is inefficient, it will be inefficient with new ideas as well. Hence, efficiency and innovation just have to learn to live and function together. Efficiency will extract the maximum benefit from a new idea. The greater the efficiency of an organization, the greater the need is for creativity to maintain high performance in the long run. Same as the standardization vs creativity, standardization is inside-the-box, and innovation is outside-the-box. Hence, organizations indeed need both, and in fact, cannot really exist without a healthy leverage of both. Innovation is no longer just "nice to have" luxury, but "must have" business quality to improve agility and maturity.

  • Talent Management Paradox: There are many dilemmas to manage today’s digital workforce. People are the center of any business. However, people are often the weakest link in both strategic management and change management. One of the classic debates reflects such a talent management paradox: “Shall you train your people?” with the speed of change and volatility of the economy, businesses become more dynamic, and talent also flows around more frequently. What happens if you invest in developing the people and then they leave? What happens if you don’t invest and they stay? Should you train your people and how to do it just right? If your company aspires to the top tier of success then professionalism comes with it. Building and retaining a professional workforce in such an environment means following the set of principle and playing by the updated rules. Though it is a tricky subject, and the answer also sounds paradoxical, you should develop your employees so that they can leave, but you should also treat them in a way that they wouldn't want to. So there is the paradigm shift. Develop your teams and their abilities so that they can do more for your organization. If you invest in you people, create a positive environment, and make a commitment to them, they are more likely to stay. Over the short term, there may be savings from lack of employee training, but eventually, it will hit the top as well as the bottom line: employees not at their best performance levels will impact not only winning new and repeat business but also meeting or exceeding customer expectations. It’s not enough to just invest in dollars on an employee, and not just training for the sake of training, but training that will help employees and company. Take advantage of the latest digital technology and online training, develop the tailored training solution in the most effective and efficient way to match the needs and demand.

The best practice to deal with management paradox is to strike the right balance, no silo thinking, no binary or extreme thinking, but leverage Systems Thinking and Holistic Thinking to manage digital continuum with the nature of paradox in an elegant and innovative way.  


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