Managerial Dilemmas: Exploiting paradox for strategic leadership


In the midst of the most severe recession for 80 years there is little need to argue that organizations are beset by dilemmas and paradoxes. Confidence in prevailing business models and in the underlying assumptions underpinning business decisions over many decades has now been shaken. But it is not enough to rail against arrogance and greed. Within their own (flawed) assumptions bankers and corporate leaders were acting rationally. A major reason for the failure to anticipate and warn is that observers of ...

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Managerial Dilemmas: Exploiting paradox for strategic leadership

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In the midst of the most severe recession for 80 years there is little need to argue that organizations are beset by dilemmas and paradoxes. Confidence in prevailing business models and in the underlying assumptions underpinning business decisions over many decades has now been shaken. But it is not enough to rail against arrogance and greed. Within their own (flawed) assumptions bankers and corporate leaders were acting rationally. A major reason for the failure to anticipate and warn is that observers of organizations usually tend to view organizations in terms similar to those employed by the people who run them: as rational, sensible and objective, whereas, in fact, they are usually confused and confusing, paradoxical and contradictory entities. Paradox is at the heart of how organizations work (or don’t work) yet the phenomenon has been strangely unstudied.

In an age of crisis and uncertainty, dilemmas and paradoxes are especially evident and prevalent. The fascination and the promise of paradox is that there is also a sense that there is a hidden truth entwined within the opposites. This we contend is a challenge for leaders. The ultimate responsibility of leadership is to make sense of these and to handle them in a competent manner. This demands a new mode of leadership. The management of dilemma and paradox it is contended, the essence of leadership today. Paradoxical forces provide a dynamism which, although often experienced as potentially threatening, discomforting and negative can also be exciting, promising and positive.

"The assumption that organizations are rational entities is challenged every day in the work environment by a rich reality of asymmetries between conflicting forces, complexity, hidden intentions and paradoxes. Anyone wanting to understand the real forces that govern organizations should read this book. A must read for modern leaders who have the intellectual honesty to lead organisations with open eyes and not with the over simplifications and clichés of the past"—Giovanni Ghisetti, Director Business Transformation, Coca Cola Enterprises Europe

"Storey and Salaman’s description of the paradoxes which characterise leadership today is hauntingly accurate. Their intelligent optimism that those dilemmas can be met is as encouraging as it is challenging for those of us who have to do just that. Having read the insights in this book I now understand how their business advice was always so pertinent".—Andy Street, Managing Director of John Lewis

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Product Details

  • ISBN-13: 9781405160278
  • Publisher: Wiley
  • Publication date: 8/17/2009
  • Edition description: New
  • Edition number: 1
  • Pages: 286
  • Product dimensions: 6.10 (w) x 9.10 (h) x 0.90 (d)

Meet the Author

John Storey is Professor of Management at The OpenUniversity Business School. He regularly consults for public andprivate sector organisations and has served on several governmentaladvisory panels. He is Chairman of the Involvement &Participation Association (IPA). He has served as journal editorand sits on several journal editorial boards. He has authored andedited around 20 books and published widely in leadinginternational journals. He has led many large-scale researchprojects; current work focuses health service organisation,governance and management.

Graeme Salaman is Professor of Organisation Studies, OpenUniversity Business School. He has written many books and articles.He has worked as a consultant at senior levels in eight countriesfor clients such as Sun Microsystems, Willis, BAT, Allianz, Ernst& Young, the government of Ethiopia, Rolls Royce and MorganStanley. Recent projects include work in Ethiopia where he hasworked on change issues in the Minister of Foreign Affairs, and theMinistry of Information. .

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Table of Contents

Preface xiii

List of case organizations xvii

About the authors xix


1 Exploiting dilemmas and paradoxes through a new mode ofleadership 3

Meanings of dilemmas and paradox 12

The exploitation of paradox 12

Types 14

Dilemma/paradox 1: strategy and business models 17

Dilemma/paradox 2: organizational structuring 18

Dilemma/paradox 3: performance and control 19

Dilemma/paradox 4: innovation dilemmas 19

Dilemma/paradox 5: managers’ knowledge 20

Dilemma/paradox 6: organizational change 20

The role of leadership 21

Conclusions 23

Organization of the book 27

2 The nature of dilemma and paradox 29

Dilemma and paradox 29

Experiencing dilemma and paradox 31

The organizational level 33

Visualizing dilemmas 35

The subjectivity of dilemma and paradox 39

Exploiting dilemmas and paradoxes 40

Managing paradoxes 43

Conclusions 44


3 Dilemmas and paradoxes of strategy 49

Strategy and capability 50

Business and organizational models 53

Strategy and organizational design 56

Two case studies: EngCon and contract cleaning services 58

Case 1: The engineering consultancy company 60

Case 2: Commercial and industrial cleaning and support servicescontractors 69

Discussion 77

4 Dilemmas and paradoxes of organizational form andstructuring 81

From bureaucracy to market 87

Project management 91

Process management 93

Joint ventures and alliances 97

Strategic outsourcing 98

Supply chain management 101

Networks and virtual organizations 102

Conclusions 105

5 Dilemmas and paradoxes of performance management109

The meaning and implications of performance management 113

The paradox of control 115

The performance control process 116

The social complexity of the process 118

Types of control 119

Direct supervision 119

Technical controls 121

Administrative controls 122

Quality and Just-in-Time manufacturing 124

Incentive payments as a form of performance management 125

Self controls and social controls 126

Control and resistance 128

The vicious circle of control 129

Positive responses to controls 130

Reconciling control and autonomy 131

Performance and management systems 131

The wider context 133

Conclusions 135

6 Dilemmas and paradoxes of innovation 137

Introduction 138

Innovation issues 139

Business strategy and the management of innovation 140

Barriers and enablers 141

Exploration versus exploitation 143

The role of established cognitive structures and recipes 144

Our findings about managers’ use of theory and the choicebetween two divergent models 146

Managers’ interpretations of the nature and priority ofinnovation 150

Different interpretations and their consequences 152

The moral and affective dimensions 153

The illegitimacy of innovation? 154

Analyses of the source of the problem 155

Formal and informal systems 157

Informal systems 158

Organizational cultures 159

Mindsets and values 162

Approaches to innovation: a danger to be controlled or energy tobe tapped? 163

Loose/tight 164

The value of searching 165

The role of leadership 165

Conclusions 166

7 Dilemmas and paradoxes of managers’ knowledge171

Fads, fashions and prevailing assumptions 174

Developing strategy: the role of executives’ knowledge andthinking 177

Why are executives’ ideas powerful? 179

Tacit knowledge and explicit knowledge; consensual knowledge anddifferentiated knowledge 180

Findings about executive managers’ strategic knowledge183

Type 1: common unexplored understandings 184

Type 2: divergent, submerged/unexplored confl icts 187

Type 3: negotiated action 189

Type 4: manifest confl ict 191

Conclusions 192

8 Dilemmas and paradoxes of organizational change 195

Introduction 195

The nature and sources of change paradoxes 198

The knowledge and role of managers 199

The nature of organizations 200

The objectives of organizational change projects 201

The paradoxes of change processes 204

Why change? The relationship between organizational capacity andorganizational strategy 205

Why change? Basic systems 208

Why change? Core competences 209

Why change? The adaptive organization 211

Why change? Strategic capacity 214

Key change problems and solutions 215

Key change problems: organizational capacity to change 215

Key change problems: symptoms and sources 216

Key change problems: changing how we change 218

Key change problems: changing the organization or helping itlearn to change? 219

Conclusions 220


9 Implications for leaders of organizations 225

Dilemmas and paradoxes of strategy and of business models229

Dilemmas and paradoxes of organizing 233

Dilemmas and paradoxes of performance management 233

Dilemmas of innovation 234

The paradoxes of change 236

Cross-cutting applications and a summary of lessons for leaders237

References 243

Index 253

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