How to make better decisions by using paradoxes

How did you come up with the idea of researching paradoxes?

David: We live in a complex world characterized by phenomena that are interrelated but fundamentally contradictory. Take economic growth with its ever-increasing use of resources and the ecological crisis as an example. The great challenge of our time is to find the best possible way to manage these paradoxes.

María: Understanding paradoxes can allow leaders to make better decisions. A “both/and” approach to paradoxes, rather than “either/or” thinking, can reveal new opportunities to leverage the interrelationships between economic, social, and environmental issues.

That sounds good, but is still fairly abstract. What does it mean in concrete terms?

María: Consider a manufacturer of casting components, for example. A carefully designed product may provide economical, ecological, and social benefit at the same time – if it needs less energy, emits less CO₂, and has low weight plus good ergonomics to protect workers’ health and safety.
 

David: Another example would be a raw materials supplier that recycles rare earth instead of mining it in the third world. Mining can harm the environment and is hazardous for workers. When material is recycled, more is left for future generations. Here too, ecological and social concerns go hand-in-hand. Last but not least, there is also an economic benefit from the reputational gain.

How do I find the right way to deal with paradoxes as a practitioner or for my company? Are there such things as rules of thumb?

María: There is no silver bullet. But in our research, we identified organisational mechanisms like prevalent economic focus, legal compliance drivers, and strategic advantage perceptions. Practitioners can leverage these mechanisms to bring about mindset shifts within their organisations.

For example, reframing sustainability initiatives in terms of their strategic benefits could help foster greater integration between paradoxical demands.

David: In some cases, economic constraints or regulations are very strong, so that they dictate where the focus must be placed. A clear focus also makes sense, when  environmental or social concerns are part of the core business or DNA of the organisation.

For example, depending on their history and values, Community Food Initiatives could prioritize either environmental goals such as supporting local producers, or social justice goals such as helping food-insecure consumers.

What other factors are there?

Other companies may tend to address socials matters first, if they seem to be low-hanging fruits, like for instance an awareness campaign for gender equality. Ecological concerns like waste reduction, on the other hand, are often more difficult to implement, but they have the advantage of being easier to quantify.

Another perceived strategic advantage that can help to shift mindsets to a more synergetic view is reputation: social or ecological benefits can foster reputation and thus lead to economic benefit.

Let’s take a look into the future: Companies are supposed to be good employers, protect the climate, and then earn money. Are expectations becoming increasingly taxing for companies? What can research do to help them?

David: Currently, we’re seeing grand societal challenges such as globalisation, digitalisation, and climate change. Paradoxes reflect the contradictory demands of today’s business environment. Our research can help organisations and individuals adapt in a complex world and successfully tackle society’s grand challenges.