VOLUME 19 #3

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Creative conflict can be good for business

Wendy K. Smith
Wendy K. Smith

RESEARCH | In a tough business climate, successfully managed tension at the top can help companies embrace innovation while addressing the demands of their core business units, according to researchers.

Maintaining this climate of creative conflict in the executive suite is the subject of a Harvard Business Review working paper, titled “The Ambidextrous CEO,” co-authored by Wendy K. Smith, assistant professor of organizational behavior at UD.

“We shared this paper with the Harvard Business Review in order to get the word out to a larger audience,” Smith says. “It developed from a study on how top management handles the tensions of exploring the future and exploiting the present.”

She says the study of 12 top management teams at major companies suggests that for companies to foster this paradoxical approach, they need to do three things: Develop an overarching identity; hold tension at the top; and embrace inconsistency.

“Those that were successful really held the tension between innovation and core products,” Smith says. “They embraced it, spoke about it and played with it. They weren’t committed to one time horizon at the exclusion of the other.”

The researchers found that successful top teams also did not measure innovation units and core businesses by the same performance standards.

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“Failure occurs when top management pushes innovation down in the organization,” Smith says. “This is a recipe for failure, because innovations are so vulnerable that they cannot exist without the support of the CEO to hard-sell them to the unit managers.”

In the classroom, Smith incorporates these lessons about managing paradoxical tensions when teaching about organization and change. “It’s about what it means to manage tensions and inconsistencies between today and tomorrow,” she says.

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