A Leadership Dilemma That Doesn’t Go Away - especially for SME
- Bernhard Nitz
- Jul 15
- 3 min read
Updated: Jul 17
If you’ve ever led company or a business unit, you know the tension.
On one hand, your organization depends on efficiency for todays operations: Stable processes. Reliable delivery. Measurable KPIs. Predictable outcomes.
On the other hand, your organization needs innovation and ensure it's longterm competitiveness:
New ideas. Fast learning. Smart risks. Adaptability.
And both are non-negotiable.
So how do we lead in this paradox without tipping too far to one side?
The dilemma is real – and ongoing.
It’s not a one-time decision between stability and novelty. It’s a constant balancing act — one that many leaders silently struggle with:
“How do I protect performance and allow experimentation?”
“How do I encourage bold thinking without causing chaos?”
“How do I know when to optimize — and when to challenge the system?”
Too much emphasis on efficiency, and innovation suffocates. Too much focus on innovation, and reliability breaks down.
What works: Leading with ambidexterity
Ambidextrous organizations don’t try to force everything into one mold.
Instead, they create two distinct operating modes:
The Stable Mode
Focused on performance, quality, and continuous improvement
Clear roles, KPIs, and accountability
Drives operational excellence and scale
The Exploratory Mode
Designed for creativity, learning, and iteration
Encourages safe-to-fail environments
Surfaces new opportunities and unlocks future readiness
And here’s the leadership challenge:
It’s not just about allowing both.
It’s about actively protecting and strategically steering both.
It's about leading and managing with two very different styles in parallel.
The smaller the organization you lead, the bigger the challenge
What makes innovation real - without sacrificing operational effiency?
The following models are designed to innovation a protected space and processes that are very much outcome driven. They are not about dreaming of some far, fancy and bold future, they are all designed to create something tangible and to not waste time or money.
Design Thinking workshops to shift from problem-solving to problem-understanding.
Prototyping sprints that value learning over perfection.
Cross-functional teams to break silo thinking and increase diversity of thought.
Hackathons to trigger momentum and explore bolder ideas.
Structured innovation funnels to evaluate, fund, and scale the right ideas.
These formats aren’t innovation theatre, they work for real and can applied by SMEs.
Nevertheless, there is no magic in those methods, they all need to be backed by leadership that supports both operating systems and the bridge between them.
So what’s the role of leadership in all this?
It’s not about doing more, it's about providing orientation and guidance, it's about letting go and trusting the process. This also means staying calm, making decisions based on facts rather than a feeling, understanding that your team doesn't have all the answers either. It's important to see it as a process for gaining clarity a team and a leader:
Knowing when to shift modes — and helping others shift with you
Building trust in both systems
Creating clarity of purpose in ambiguity
Modelling curiosity, commitment and courage, not just control
Because the biggest blocker to innovation isn’t a lack of creativity —
It’s a culture that only rewards what’s working today, based on the improvements of yesterday.
Final thought:
The question isn’t “Do we need innovation?”
We all know the answer to that.
The real question is:
“Are we creating the conditions where innovation can coexist with execution — without being crushed by it?”
I’d love to hear from you:
How do you balance these two modes in your teams or organization?
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