Hidden Brain - Thriving in the Face of Contradiction

Episode Date: October 18, 2022

We all face tough decisions in life, whether we're juggling the demands of work and family or deciding whether to take a new job. These situations often feel like either/or choices.  But psychologist Wendy Smith says this binary way of confronting dilemmas contains a trap.  She offers a different way to think about difficult choices, one that opens up unexpected possibilities. Did you catch our recent episode about why we sometimes confess to  things we didn't do? You can find it  here. And if you like our work, please consider a financial contribution to help us make many more episodes like this one. 

This is Hidden Brain, I'm Shankar Vedanta. Do you want to know what it is? The Matrix is everywhere. It is all around us. In the hit 1999 sci-fi film The Matrix, the character Morpheus, played by Lawrence Fishburn, tells Keanu Reeves' character Neo about the hidden forces that control the world. Worn into a prison that you cannot smell or taste or touch. A prison for your mind. Morpheus offers to let Neo see the truth for himself.

But to do so, he first needs to make a choice. Morpheus shows Neo his closed fists. You have to see it for yourself. He opens his palms one by one. In his left hand is a blue pill. In his right, a red pill. He asks Niel to choose. This is your last chance. After this, there is no turning back. You take the blue pill. The story ends. You wake up in your bed and believe whatever you want to believe. You take the Redville, you stay in Wonderland, and I show you how deep the rabbit hole goes.

All of us confront forks in the road. They might be less permanent and irreversible than the one confronting Neo, but then again, the choices we confront in real life are real. Should we move to another city or stay put? Say yes to a marriage proposal or say no. Re-invent a business or stick to doing what we know best. This week on Hidden Brain, the psychology of dilemmas and how to learn to make better choices.

Sometime in the recent past, you have probably wrestled with a dilemma like this. Should you miss your vacation in order to attend your cousin's wedding? Or maybe you've debated whether to make a risky investment? Or perhaps you're asking yourself right now, should you work less to spend more time with your child? To confront the dilemma is to feel pulled in two directions. We sense that no matter which course we choose, we are going to lose something important. Wendy Smith is a psychologist at the University of Delaware. She studies leadership and organizational behavior. She also studies how we think about dilemmas and how we ought to think about them. Wendy Smith

welcome to Hidden Brain. Shankar it's great to be here. Wendy I'd like to start by hearing the story of a man you've studied, he was an American scientist named Edwin Land, and something important happened when he went on a vacation in 1943 with his family. Tell me that story. Well Land was a scientist who was at Harvard, and he left Harvard before graduating to start the company of Polaroid and he was making polarized filters for cameras and sunglasses and one day when he was on vacation he took

a picture of his daughter Jennifer with a camera and she wanted to see that picture immediately. And this question was the spark for him to develop the instant camera, what we now know as the Polaroid camera, to develop instant film. And it really captured the market. They were the market leaders. So that by the end of the 1970s, they were pulling in more than a billion dollars annually in sales. Polaroid wasn't just a business success. It became a cultural phenomenon. Famous Americans would carry Polaroid cameras around with them, snapping pictures of their

lives just like Instagram influencers today. It says yes, taking the shot, counting down, dimming it off, painting. The company was seen as hip and cool. It was also a pioneer in developing a stunningly successful business model. Today, we call it the Razer and Blade Model. This became really important to their success and how they thought about the organization and the business. So the Razer and Blade model essentially is that companies sell the Razor's cheap and

then make money on the blades of the cartridges. It's the same model that companies use for printers and ink. For Polaroid, they essentially figured out that if they sold their cameras cheap, they could then get the cameras into the hands of lots of people and the people would therefore need more film to use for those cameras. So they would sell their cameras in places like Kmart and Woolworth's, not in specialty camera stores, and it created a tremendous market for their film, which they would make as much as 70% profit just on the film.

Polaroid didn't think of itself as an instant camera company, it thought of itself as an instant film company. In its heyday, it boasted a workforce of more than 20,000 people and had a 75% market share. Best of all, Edwin Land and the company he had built didn't just sit back on their laurels. Polaroid devoted enormous sums of money to research and development in order to maintain that domination of the instant photo business. This position in the marketplace is no accident.

It has been carefully built and owes its growth to a good many factors. Constantly improved. So the company was started by a land who was a scientist. His main focus was engineering. The company was really focused on being an engineering company. It was strong in their DNA and in their culture. They had very much then not invented here syndrome, which was that they weren't going to buy technology

and innovation from outside the company. They really were going to invest and figure out how to create new things inside the company. So this is a real success story. Someone who comes up with a brilliant idea sees a need in the market. Engineers a device that basically millions of people find really useful captures enormous market share and makes huge profits, I mean, incredible success story. But then along come the 1980s, and then there's another innovation

in the world of photography. Tell us what happens next, Wendy. Right, and so Polarid's story is like so many stories we've seen of large companies where a new technological innovation comes up and it's the large companies, the sort of big oil tankers out there, that have the hardest time shifting and turning,

compared with the small and entrepreneurial organizations. In this case, it was digital photography, digital imaging, in which it was no longer the analog picture that got placed onto the film. It was digital pictures, the kind that we now take on our phones all the time. And did Polaroid see the danger? Did they say this might be a market we might want to invest in it as well? They did actually, they were engineers. This was an engineering company through and through. And so they did see the possibility. They were excited about the technology of digital imaging. In fact, in the 1980s, they had invested something like 30 million dollars of capital investment to develop a microelectronics lab with an annual $10 million budget in order to explore how to develop this digital imaging.

So if you were to tell me the story at this point and stopped here, and you say, you know, this is a company that has, in some ways, the best position in terms of photography, in terms of capturing a huge share of the existing market. There are science and R&D company. They've invested and figured out ways to actually build digital cameras. I would say this company is perfectly poised to capture this next wave of the photography market. Is that what happened?

Well, that would be a good hypothesis and that is absolutely not what happened to Polaroid. In fact, rather than capturing the market, they got stuck in their existing strategy. They had this razor and blade business model. You sell the razor cheap, make money on the blade. You sell the camera cheap cheap make money on the blade, you sell the camera cheap make money on the film. The problem was was that when it comes to digital imaging, there is no film. And so they kept going back and trying to figure out how you printed out these digital images. What was the value of being able to print this? Thinking that indeed their customers, just like

Lann's daughter Jennifer, would want the hard copy of the picture in their hands immediately, and yet not thinking through or realizing that as the technology would move forward, so too with the market in terms of how we would all think about photography and pictures and images. What about the profit margins on cameras versus film? Did that play a role in their thinking? Right, so if they were making such a large profit on their film, why go back to something smaller on digital cameras?

Our colleague, Mary Tripsis, who did a deep dive into this work on Polaroid and their transition or what she says, what was fascinating to me was that these guys used to turn their noses up at 38% margins on digital cameras. That was their big argument. Why 38% when they can get 70% on the film? Why would they wanna do this?

Yeah, so they were like, we are making money hand of a fist year, we're basically printing money here with our instant film. Why would we want to get only a 38% profit by selling digital cameras? That's right. So tell me the rest of the story. What happened to Polaroid as the market eventually evolved

towards digital cameras, Wendy? Well, eventually they realized that they have to create a digital camera. And so they did introduce their digital camera in 1996. But by that point, they were way behind the curve. There were more than 40 competitors in the marketplace. Their new CEO, Gary Di Camillo, came in and talked about how challenging this was because he was, as he said, quote, trying to change the fan belt on the car while the engine is running. ban belt on the car while the engine is running, but eventually wasn't able to get into the market. And eventually, Polaroid had to file for bankruptcy.

The news has been all bad all year for Polaroid. Layoffs, defaults on his bond payments, cuts in benefits, and rumors the company will sell its distinctive headquarters building to help pay $940 million in debt. In fact, I remember this moment. It was in 2001. I was in grad school at the time. Polaroids offices were right across the river from my office. And I saw the headquarters going from a somewhat bustling

place to up for sale. It seems perverse that a company with all the resources and know-how of Polaroid, a company that had been heralded for its innovations, failed to capitalize on its advantages. Yet Wendy has found that this is not unusual. She argues that Polaroid's downfall is connected to a larger problem in the way many of us confront dilemmas. That's right. We see this happen again and again market leaders committed to their existing worlds are the ones that are at the greatest peril for failure.

The greatest indicator of failure is success because it's so hard to transition from the existing world into the new world. And the underlying problem here is not just that they can't transition, but they are stuck in binary either or thinking between either focusing on the way that they've always done things in their existing world, or into the ways that they're going to move into the future, they can't live in both at the same time. Whether we are executives managing a multinational cooperation or individuals navigating our personal lives, all of us are presented with a constant stream of dilemmas. They pull us first in one direction and then in another. To solve these dilemmas, we often ask ourselves the question, which path is best?

We might draw up a list of pros and cons, but it turns out this seemingly reasonable way to frame the problem conceals a trap. You're listening to Hidden Brain, I'm Shankar Vedantam. Psychologist Wendy Smith studies the way we think about dilemmas. When we are faced with a choice, we often feel we have to go in one direction or another. Wendy, you argue there is something fundamentally wrong with that binary approach that either or thinking. What is wrong with it?

Yeah, we say that either or thinking is limited at best and detrimental at worse. And the reason is, is because it leads us down these vicious cycles. We either get stuck in one way of thinking and not seeing the whole and bigger picture, it minimizes the potential for engaging other perspectives that can let us be much more creative. And it can create an ongoing loop of negative conflict that just creates this downward cycle, this downward race to the bottom. So I'd like to look at these problems in some detail, but I want to first ask the question, why are minds gravitate so readily to this binary model? Why is that

windy? Yeah, and I think it's both how we think about things and how we behave. So the way that we think about issues, we like to anecdotally break issues down into opposing sides, split them apart, and in doing that, we then want to make a choice. Because emotionally, if we leave the choice open, it makes us feel more anxious. We feel a little bit more fear in the uncertainty, so the more quickly we can make a choice, the more that we can engage and feel more connected. And then behaviorally, the things that are around us, once we've made a choice, we kind of get into a habit of reinforcing that choice so that we can maintain a commitment to

the way that we've always done things. So what I hear you saying, Wendy, is that even though dilemmas can feel painful, in some ways they're an example of simplified thinking. In some ways, we're simplifying the world by presenting it to ourselves as an either-or choice. That's right. And being able to make that choice makes us feel more comfortable. So as soon as we frame a dilemma as an either-or choice, your research has found that there's a cascade of mental and emotional consequences that follow. And the first is that we feel powerful pressure

to make a choice. Can you walk me through how this works? So imagine what we do to college students, just as they're about to graduate. We say to them, what are you gonna do next? Or what we do when we have an open question. For example, if we think about the pandemic, there were all kinds of open questions

and people just wanted those questions to be answered. We don't want to leave them open. And so there is this both internal pressure to try and make a choice to minimize the discomfort. There's also this external pressure of looking for some clarity and some decisiveness. So once we do land on one side or the other of this, you know, either our binary, other cognitive mechanisms get set into motion, can you talk about how making a choice can lead us in some ways to become invested in that choice? Yeah, so one of the pieces that happens is that we have this pressure to be consistent, both to be consistent in our choice and to be consistent over time. That is we get

completely entrenched or committed or stuck in the ways that we think about things and the frameworks that we use, in the schemas that we have in our mind. And essentially, it becomes the idea of, you know, if I have a hammer, everything is a nail. And so sometimes our expertise leads us to see the world as nails when in fact what we're looking at is bolts and screws rather than nails. I mean, this is the Polaride problem all over again, isn't it, which is Polaride had this business model, the Resident Blade model, and when digital cameras came along, they said, how do we adapt this new business, this new innovation to our existing strategy? That's right.

A square peg in a round hole, they had a round hole. It was incredibly successful for them. And when the square peg came along, they tried to figure out how do we make this new technology fit with our existing strategy because our strategy works for us right now. You've also found that binary thinking can affect what we pay attention to, what kind of information

we seek out, what kind of information we ignore. I feel like in recent years we've seen the problems with binary thinking play out on a national and global scale during the run-up to the 2003 US invasion of Iraq for example American leaders frame the invasion as a binary choice either the US invade Iraq or the world was at risk for nuclear war Secretary of State Colin Powell spoke to the United Nations Security Council on February 5, 2003 about why inspectors had not found clear evidence of Iraq's weapons of mass destruction. All the inspectors to search the house of every government official, every path party member,

and every scientist in the country to find the truth, to get the information they need to satisfy the demands of our council. Our sources tell us that in some cases, the hard drives of computers at the Iraqi weapons facilities, were replaced. Who took the hard drives? Where did they go? What's being hidden? Why? There's only one answer to the why, to deceive, to hide, to keep from the inspectors.

Numerous human... So he says there's only one answer to the why, to deceive, to hide, to keep from the inspectors. When I hear that now, at least with the benefit of hindsight, Wendy, that sounds to me like confirmation bias. It does. I'm so glad you raised this because I think this idea of binary thinking really intensifies as we move into higher levels of leadership

and certainly into political leadership. And what we saw in that case was, do we go to war? Do we not go to war? And once we have decided we go to war, do we not go to war? And once we have decided to go to war, how do we then reinforce, create the confirmation bias that we have made the right decision not only for ourselves, but then also for the rest of the American public. And then, by the way, once the decision was made, then we see another bias, which is this bias of the escalation of commitment, which Barry Stah, who is a professor at Berkeley, had coined, which is that once we

have committed to something, we double down and continue to commit to it over time. And we saw that bias then play out as well as we added troops over time to that war. You and others have called this effective binary thinking intensification or more colloquially as the character Morpheus might put it in the matrix, going down a rabbit hole. And I can sort of see that happening. Each step leads to the next step. And before you know it, you're 18 steps down the rabbit hole. And it's really hard to dig out because of the emotions that you've built around it,

the supporting structures that you have around you all conspired to keep you down that rabbit hole to intensify the point of view. So it becomes really difficult emotionally and pragmatically to actually build out of it. Now, at some point, countries and companies and individuals make these binary choices and they go down one path and then eventually, reality eventually smacks them in the face and they realize they've made a terrible mistake.

But sometimes, binary thinking produces yet another problem in situations like this and you call this the wrecking ball phenomenon. Can you explain what that is Wendy? Yes, so the wrecking ball is when once we've gone down a path and then the whole situation changes around us and we realize that we actually do need to change, we swing all the way to the other side. What we call as we over-correct. The problem with the wrecking ball is that it sort of gets rid of all of the good with the bad. You get rid of the problem with the wrecking ball is that it sort of gets rid of all of the good with the bad. You get rid of the baby with the bath water. You wreck everything that comes along in the way. I mean, I imagine that many of our listeners have experienced this kind of, you know,

back and forth decision making, for example, and you know, efforts to maintain a healthy weight, for example, where people go on extreme diets and then swing all the way around and basically give up entirely. And in some ways, it's perhaps an individual version of what sometimes happens on a national or corporate scale. Yeah, I think that's right. I think that the dieting is a great example because we try and be so disciplined that eventually when we break down for a moment, instead of just breaking down and having the cookie that we want and then getting right back into the diet,

we swing and we just let go of the whole thing. And then we swing back to over discipline. And we see the same thing with our work life sometimes. We get so invested in work until we get to a point of burnout. And then we totally let go until our email inbox becomes so full that we can't handle it anymore and so we sort of live in these over-emphasized swings. So you're the mother of three children, a 10-year-old and 16-year-old twins and

I understand that you know the wrecking wall phenomenon from your own parenting practices around sleep routines when they were small. We do. I mean, when you're trying to figure out how to parent, there are these really opposing approaches. The more disciplined and structured approach for your kids.

And then there's the more natural and approach in which your kids sort of engage in the way that they want. And sleep is like one of the first domains in which that kind of tension plays out. We started out to be very permissive with sleep and it was all great, but as you said, I have twins and their sleep schedules would be completely off. One would sleep at one time, one would sleep at the other time, and what we found was that it created an ensued chaos, and so we then said, okay, well we've got to do something to get them on to more of a schedule, and we went completely the other

way into that sort of incredibly disciplined sleep approach, and so we would close the door and let the baby cry themselves to sleep for a couple of nights, and we were all incredibly insane because of the amount of chaos that that ensued. And so, neither extreme approach worked particularly well for us. So, for the course of this episode, we've seen that it's very easy to fall into a pattern of thinking that's organized around this kind of binary either or choice. And once we do so, there's this whole cascade of problematic consequences that follows. When do I understand that you got a glimpse of another way of approaching hard questions? When you spend some time in Israel after college, tell me what happened while you were there,

Wendy. I went there to go study Jewish texts being Jewish. I had always grown up culturally Jewish, but I was really intrigued and curious about the sort of texts and the background to the religions. So I went to go study in what's called the Yashiva, a liberal Yashiva that brought together both men and women, brought people from across the religious spectrum, given that I had not grown up particularly particularly religious. And we were studying Talmud, which is the classic Jewish text.

And the way that the Talmud works is that it is a compilation of ideas that are passed down from generation to generation orally until it was finally written down. And then all around, flanked around that is commentary from rabbis from across generations that are in conversation with one another across time with differing points of view.

And one of the really intriguing pieces about studying Talmud is the extent to which there are discussions across scholars and rabbis about key issues in the Talmud, in which they are bringing up and raising conflicting ideas. And yet, most of the time, there's not a definitive answer to which one of these competing ideas wins out. In fact, at some point in the Talmud, there is a line that says these and these, meaning these two differing perspectives,

that's what leads us to a deeper truth. Our binary, either-or approach to dilemmas, leads us to assume that if one choice is right, the other must be wrong. If one proposition is true, the other must be false. When these experience studying Jewish texts allowed her to see another possibility, that the opposite of a great truth can sometimes be another great truth. When we come back, how to escape from the shackles of either or thinking, without succumbing to the perils of indecision. You're listening to Hidden Brain, I'm Shankar Vedantam.

This is Hidden Brain, I'm Shankar Vedantam. Wendy Smith is a psychologist at the University of Delaware. For years now, she has studied a series of cognitive traps that are created by dilemmas in our lives. When we confront what looks like a fork in the road, Wendy and her colleagues have found that our minds change in systematic and predictable ways. Many of these changes are not conducive to good decision-making. Wendy, the Jewish texts that you studied contained paradoxical insights? They contradicted each other, sometimes they contradicted themselves.

How did you take this insight into your own research? Well, what was fascinating to me was to think about this underlying notion of opposing ideas that were interdependent with one another. And I had that in the back of my mind as I came back to study organizations. And it was starting to study how organizations like Polaroid thought about these ideas of today and tomorrow or stability and change or their existing world and their innovative opportunities. And, you know, in some of the other pieces that I was studying, I was also exploring how organizations thought about things like social responsibility, or what we now think about

is sustainability, which is this tension between a mission orientation or their markets, profits, or thinking about people and planet. And I was intrigued by the question of how about people and planet. And I was intrigued by the question of how profits and the could it coexist with the planet, how and a focus on the bottom line could coexist with a social mission. And it was there that I started to surface this notion of paradox and the relationship between these competing ideas. So you point out that paradoxes, in fact, are all around us. We just don't see them because we are so quick to try and reduce the world to binary choices.

But in fact merely asking people to consider paradoxes makes them open to new possibilities. That's right. So if we think about the kinds of demands or kinds of challenges and dilemmas and tensions that we face, those really force on us, like you said, they sort of demand us, they expect of us, they lure us into making a choice. But if we pause and almost look underneath the hood or explore the structure of those choices, oftentimes what we see are these underlying paradoxeses where we see these dualities that are indeed in conflict with one another, and yet they're also interdependent. They define each other, they're interwoven with one another, and that persist over time. And so if we're looking at attention like studying how Polaroid is navigating its innovation, underlying that are these paradoxes of stability and change,

of short-term and long-term, of existing world and the new world. And so it's those paradoxes that if we start to look at them, can introduce to us a very different way of thinking about the problem. One of the ideas you have on how people and organizations can do this is to do something that you call getting up on the balcony. What is this idea, Wendy? So getting up on the balcony is about reframing the way that I'm looking at the bigger picture. This is actually an idea that comes from Ron Hyphids, Marty Linsky, and their co-author,

Alexander Grasho. And it's their idea of adaptive leadership. What they say is that leaders have to effectively be in the fray, in the midst of the conversations, really thinking about the issues, which is being on the dance floor. But at the same time, they have to pause and take a look and be able to see the whole forest through the trees.

They have to be able to see the overarching picture and the differing perspectives. They have to take a broader and longer term perspective. And this is what they call getting up on the balcony to be able to let go of the immediacy of the arguments and be able to engage in the broader, more holistic point of view. You've written that one essential quality of paradox is that it accommodates multiple and even contradictory truths. I mean, that almost sounds like a parable. It does.

We often tell the Hindu parable of the blind people and the elephant. And the way that this parable goes is that a bunch of blind people came and approached an elephant and wanted to know what was before them. And so each of them touched a different part of the elephant. And by doing so, they had a different analysis or a different conclusion of what this was. So the person that was touching, the tusks thought that it was a spear and the person that was touching the trunk thought that it was a snake, and the person that was touching the legs thought that it was a tree stump. And so each of them really committed to

what they had experienced and started to get into conflict with one another as they described what they experienced. It led to a tremendous amount of conflict. The aha here is that if each of them had paused to listen to one another, to understand what the others had seen and experienced, they would be able to get a better sense of the overall holistic picture that this was in fact an elephant

to put the different pieces together. And that's partially what we see with paradox, which is that we tend to go down, as we said, get stuck in the rabbit hole of one point of view, one perspective, our own expertise, our own identities, and become really stuck and committed to that, and not see the bigger picture to be able to put it together into something more holistic. You said a second ago that one of the qualities of paradoxes is that they are in fact not resolvable, that in fact the poles of a paradox are always going to persist and always generate tension.

And in fact this might be one of the reasons why many of us run away from paradoxes because they require us to sit with the discomfort of not being able to perfectly resolve the paradox in one direction or the other. So, when do you've come up with a few approaches to dilemmas that get us to see beyond the blinkers of binary thinking? And the first is something you call creative integration. Can you give me an example of this? Right, so a creative integration is kind of what we tend to think about when we think about both and thinking as an alternative to either or. It's the classic win-win, the find and ideal solution that accommodates both sides of competing

demands. We use this classic example of the muole because the muole is smarter than a donkey and faster than a horse. And we can think of a whole bunch of moments where we would see this kind of creative integration. In fact, there was a brilliant author and psychiatrist Albert Rothenberg, and he was really interested in understanding

how it was that geniuses came up with their best ideas. And what he found was that geniuses like Mozart and Picasso and Einstein and Virginia Woolf in her writing really came to these brilliant masterpieces by juxtaposing ideas and finding this creative integration between them. So, you know, for example, Einstein's theory of relativity emerged by asking how could an object be both at motion and at rest at the same time. For Picasso, it was how do you juxtapose dark and light within an image to create something more holistic? And then for Virginia Woolf, she plays with these these images the integration of life and death in some very powerful ways to bring out some really evocative emotions.

There's a second method to engage with paradox and you call it tightrope walking. What do you mean by this Wendy? In the very first research study that I ever did, I was studying how IBM was managing both its existing product and its innovation. And I went in thinking that there were going to be all of these brilliant mules, these creative integrations in which they found this moment that both the existing product and innovation could work beautifully together. And instead I saw something very different. What the most effective leaders were doing was that they were making these sort of subtle tweaks between how they would allocate their resources or how they would think about the structures of their organizations that would sometimes reinforce and benefit the existing

products and sometimes reinforce and benefit the innovation. But they were making these tweaks in very subtle ways over time. And we call it tightrope walking because if you think about a tightrope walker, they are looking out to the future, focused on a goal and a point, but in order to get there, they're never completely balanced. They're always balancing. That is their sort of subtly shifting between left and right in order to get out to the future. I mean, in some ways, it's the very opposite of the wrecking ball, isn't it?

Because the wrecking ball doesn't make slight adjustments from left to right. It basically is swinging all the way from one end of the pendulum to the other. Whereas what this is suggesting is that you can actually make adjustments that are very small and by making a number of them, you can actually stay upright on the tightrope. That's right. If you go too far to the left or too far to the right, you fall off. And so that is the wrecking ball approach where you end up in this vicious cycle. This is actually a much more subtle approach. Wendy told me she practices a form of tightrope walking herself when she feels pulled into

directions. For example, she has to choose between a family reunion that often takes place in the United States over the July 4th holiday and an important academic conference in Europe that is scheduled at the same time of the year. That's a little bit more of a tightrope approach, which is the way that I can both and in that situation both be with my family and reinforce and support and deepen my connection to my colleagues and my work is that some years I make a choice to be with my family, some years I make a choice to be at my conference, and some years there might be this perfect

both and, which is that the conference isn't exactly on July 4th, and I can be with my family and then go to the conference. But what it suggests is that part of the ways in which we can both-and is that we don't have to find the perfect both-and in every moment. We have to consider each choice individually. We can think about how the compilation or portfolio of choices over time allows us to commit to these two different demands or needs or goals that we have. It seems to me though, Wendy, you've made a really strong case for both and thinking, but I'm wondering, is there also room in this thesis

for the times in which we actually have to make a unitary decision? I can imagine there are times in the lives of individuals, of companies, of countries where in fact the right answer is not, how do we balance this multiplicity of options before us, but in fact to pick, you know, choice A or choice B? Shankar, I love that question. And in part, this helps us to differentiate between what's a dilemma and what's a paradox. And so what we would argue is that paradoxes persist over time and we want to accommodate them both. Dilemas are the dressing or the instantiations of particular paradoxes. And so what comes before us is a dilemma that forces us to make a choice.

Am I going to go to war or not going to go to war? Am I going to go to my conference or stay with my family? Am I in this moment going to spend this hour doing work or am I going to go and help my kids with homework? And each of those requires an either or choice. What we would argue is that, again, if we pause and look at the paradoxes underneath, it will help us think about how we navigate those choices over time. So even once we go to war, we're still constantly in an ongoing conversation. Should we stay? Should we escalate our troops? How should we navigate that? And it's those possibilities, re we stay, should we escalate our troops, how should we navigate that? And it's those possibilities, re-thinking, being open to constantly seeing alternative

perspectives that helps us to consider how we navigate those choices in an ongoing way over time. So when do we started this episode by talking about a company that faced a dilemma, the models and patterns that made Polaroid so successful in the past were getting in the way of its survival in the future. Now you and some collaborators have studied another well-known company that seemed headed for the same fate. Tell me the story of Lego.

So Lego was a company that exactly like Polaroid was at the top of its market and then was a product of the way in which success can lead to failure. This is a company that was studied by my co-author, Mary Ann Lewis and her Danish collaborator, Lada Lusher. Lego was started in the 1930s, it was a family-owned business. Legel is here. Hey, kids! Eventually, they figured out this brilliant idea of the interlocking brick that became tremendous in the toy market. In fact, at some point, they controlled nearly 80% of the construction toy market globally. This young boy has such fun. We will play go one by one.

We will be next at a webtoot of a lane. This young boy's led Lego king. Lego, a whole new world to build. This young girl. Like Polaroid, Lego really resisted any kind of change in terms of its approach. And so we saw that kind of resistance in things like they had developed their interlocking brick in five colors, red, yellow, blue, black, and white, and it took them years to decide that they were going to add green to the mix. And there is this classic story

where in one of their meetings, George Lucas came into their senior leadership meeting and proposed the idea of a collaboration between Lego and Star Wars, and one of the vice presidents basically declared over my dead body will we ever introduce Star Wars to Lego. So real resistance to change. But then, like Polaroid, Lego started confronting a major disruption. Computer games were getting increasingly popular and starting to steal market share. Lego behaved exactly like Polaroid. First, they doubled down on their existing model. When that didn't work, they hit the panic

button. It started to spiral like Polaroid down this rabbit hole of committing to its existing approach and eventually realized that they were going to fail if they did. So Lego was a great example of what they did was that they over corrected. They started to say, okay, we need to innovate, we need to innovate now and we needed to innovate fast. And they started to produce all different kinds of sets that weren't just the classic interlocking

brick, but it was all different kinds of sets that weren't just the classic interlocking brick, but it was all different kinds of pieces. Within seven years, they moved from something like 6,000 different types of pieces to 14,000. They moved into not just green, but 157 different colors and hues. It was at this time that they even moved out of the bricks. That's when they introduced new mini figures. They had about six different types of chefs. And each one of them just a little bit more nuanced than the other. That's when they introduced Lego land of the theme park.

And they start to co-brand with Star Wars and so many others. So they started to try all different kinds of things in order to keep up with the market. So they moved from a very conservative approach to try everything and anything possible. I mean it's almost the wrecking ball phenomenon writ large, right? You're throwing literally anything at the wall, seeing what will stick. I'm wondering how this sudden switch in the direction of excessive innovation, how did it affect the company and its balance sheet?

You know, it was this over correction, this wrecking ball that almost led them into bankruptcy. Because what they found was that revenues were going up, but costs were so significant, they had skyrocketed to such a degree that their profits were just declining. And they were in a really quick, vicious cycle. They were spiraling downward incredibly quickly. So, in 2003, the Lego Group announced the biggest loss in its history, and some wonder

if the company was going to survive. A new leadership team was brought in. What happened? What did they do? What actions did they take? The new leadership team looked out and said, okay, well, we need innovation. We need new ideas, but not to this extreme. They started to think about how could we come up with some simple rules, some boundaries,

some guardrails that would allow us to innovate, but not go so far that we're going to fall over and that we're going to fail as a result. And so they then scaled back. They looked across all of their different pieces. They looked across all their different types and said, okay, what are we going to keep and what are we going to get rid of and became much more disciplined about their innovation so that they could reduce their costs while still maintaining this new and these new opportunities in the market. So we saw that Polaroid wasn't able to meet the

challenge, it eventually filed for bankruptcy, what became a FLEGO? up succeeding in fact and living in this ongoing tension. In fact in their 2020 annual report their group CEO said that they had hit a year of record profit, calling on this need to maintain a commitment to being both creative and disciplined over time. After nearly destroying the company with binary thinking, Lego changed its entire philosophy. Like the Jewish texts Wendy had read, the company began to realize that success was not about eliminating paradoxes, but living with them. This is what's so beautiful about Lego is that they have built this idea of paradox now, not only into how they think about innovating and how they approach their products and their market.

They've built it into how they think about leadership, they've built it into how they think about the culture of the company. So, you know, they talk about the importance of being able to lead and be out in front, but also hold oneself back and enable space for other people. They talk about the importance of being able to trust one another, but also to verify, to be able to keep an eye on what's happening so that you are able to feel confident. They talked about, you know, an important one, they talk about being courageous and certain to be sure of yourself, but also have some humility and to be curious

and open to new possibilities and wonder if there's other ways to do things. So these are really baked into how they talk about their culture, what they inculcate in the organization and what they hope and expect out of their people. How well have you come to practice these principles in your own life, Wendy? I love the word practice because indeed it's an ongoing practice. It's something that on one hand when I hear an either or question be asked, I have this immediate gut reaction to change the question from the either or to how can we do one and the other. And at the same time, I still find myself, I often find myself getting caught in a particular

point of view wanting to argue for it. And I learned a long time ago that I need to remind myself to stay quiet, to pause, to listen, to hear the differing ideas before I come to a conclusion. And so my reminder to myself often to do that is to go into a meeting, I will draw a little X on my hand and the X will say, when do you keep quiet? And the value of doing that is that I spend more time listening before I come to a point of view

so that I can engage with these different perspectives. I do think it's an ongoing practice and I think it's emotional, it is hard. And one thing that we talk about is it requires us to constantly recognize the discomfort of living in these opposing ideas and try and work through that to find comfort in that discomfort.

Wendy Smith is a professor of business at the University of Delaware. With her co-author, Marianne Lewis, she's the author of both and thinking, embracing creative tensions to solve your toughest problems. Wendy, thank you so much for joining me today on Hidden Brain. Shankar, it's been really fun to have this conversation. Hidden Brain is produced by Hidden Brain Media. Our audio production team includes Bridget McCarthy, Annie Murphy Paul, Kristen Wong, Laura Quarelle, Ryan Katz, Autumn Barnes, and Andrew Chadwick. Tara Boyle is our executive producer. I'm Hidden Brain's executive editor. For today's unsung hero, we turn the

mic over to you, our listeners. This segment is brought to you by OnStar. OnStar advisors are now with you everywhere, on the app, in your car, and at home. Today's story comes from Walter Delgado. Walter grew up in El Salvador. When he was young, his mother moved to the United States to earn money for the family, so Walter lived with his grandparents. My mom one day called me and she said, do you want to come to the United States? And obviously I was 11 years, and I kept hearing good things about the United States. And I said, yes, when do I leave? The first part of the trip, we were traveling in buses.

It was all the way until we got to the Mexican border with the USA that that's when things got serious. And we were all in a warehouse. and border with the USA that that's when things got serious and we were all in a warehouse. And I'm talking about like 200, 300 people in a big warehouse. And one time they came and said, okay, we're ready and we're gonna walk through the desert

an entire night. And that's when it hit me. I don't know what, wow. I was traveling with my grandfather, and I was 11, and he was old, so I was like, this is gonna be rough, and we would start walking, and I remember that I was wearing the worst shoes you can choose to walk in the desert.

I was wearing the worst, it was uncomfortable, rough. It was dark, and we were not prepared for those temperatures. I mean. I was wearing the words. It was uncomfortable, rough, it was dark and we were not prepared for those temperatures. I mean, again, we come from Central America over this tropical weather. Nobody was prepared. And the whole time we were cold, we were walking. I could hear woman crying and you know, like sometimes they're complaining of pain, their legs, and you know, heavy breathing, all those things are the most that I remember. I met Modesto alone the way. For the most part, he was quiet, slim, 5, 10.

I remember we just had normal casual, small talk, where you from, all that. I didn't know that guy from back home. I didn't know anything about him. That's when after six hours of walking and my feet started giving out. Like I was tired and I just remember that I told him, and hey man, I can't, I can't my legs and he just can't pull me up, you know, put me on his bag and started walking. And he told me, don't worry, we almost there,

we're gonna make it. I'm gonna make sure you're gonna make it. And those are the words that he kept saying, you know, we're going to make it. We're going to make it. Of course, you get those thoughts, you know, like, I'm not going to be left behind. I mean, there's so many people that they don't make in that journey. So, you know, we just met on the trip and to have the goodness, the willingness to carry someone, I must have been at least 90 pounds, probably 100 pounds.

He easily probably carried me for two to three hours. I am not exaggerating. And I should imagine, you know, he must have been tired too, the whole time. It just blows my mind. And it's one of those defining moments in my life where it gives me hope. And I can see that human beings can be a channe-le of goodness to the world. It takes me back to that that we can be good

and we can do good to others. You never know how you're going to impact other people. Small gestures can go a long way. Eventually, Walter and his grandfather made it to their destination. He became a U.S. citizen, went to college, and has a good career. For all of that, he credits Modesto. Everything that I have now, everything that I accomplish now, it takes me back to that moment. I can make more money, I can live comfortably, I have a good life now. Thank God, and thanks to Modesto, because he was the one that made it all possible.

possible. Walter Delgado lives in Houston. This segment was brought to you by OnStar. OnStar believes everyone has the right to feel safe everywhere. That's why their emergency advisors are now available to help not only in the car but wherever you are. On your phone, in your car, and at home. Onstar, be safe out there. If you like this episode and would like us to produce more shows like this, please consider supporting our work. Go to support.hiddenbrain.org. Again, if you find our work to be useful in your life, do your part to help us thrive. Go to support.hiddenbrain.org. I'm Shankar Vedantam. See you soon.