Contradictive Thinking: Can regulation trigger innovation?

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“The test of a first-rate intelligence is the ability to hold two opposing ideas in mind at the same time and still retain the ability to function.” –F. Scott Fitzgerald

So far we have discussed two methods of creativity: Divergent Thinking and Lateral Thinking.  The final method, Contradictive Thinking, is often the most difficult to grasp and implement.  However, if it can be harnessed, Contradictive Thinking can be a source of dramatic innovation.  When Divergent and Lateral Thinking fail to provide any promising ideas, it’s time to investigate contradictions.

Contradictive Thinking is the act of holding two opposing ideas or trade-offs, and instead of choosing one side or the other, ask “how can both sides be true.” The Harvard Business Review outlined contradiction strategy as central to the success of Toyota, a company that “deliberately fosters contradictory viewpoints within the organization and challenges employees to find solutions by transcending differences rather than resorting to compromises.”

To demonstrate the point, here is a list of some of the most impressive innovations rooted in Contradictive Thinking:

Industry	The Contradiction/Trade-off	The Innovation
Cellphones	Easy to use or high functionality Touch screen or responsive keyboard Small size or high powered	iPhone (2007)
Cars	Performance or Energy Efficiency	Tesla Roadster (2008)
Government	Democracy or Monarchy Local Rule or Strength Central Government	Magna Carta (1215) Federalism (1787)
Construction	Compressive Strength or Tensile Strength	Reinforced Concrete (1853)
Electricity	Low losses or useful voltage	Alternating Current (1880’s)
Banking	Anonymity or Security	Bitcoin (2008)
Medicine	Risk natural inoculation or Risk infection	Vaccinations (1880s)

Which brings us to a contradiction commonly discussed today: Regulation or Innovation.  In many cases regulation appears antithetical to innovation. Innovative companies like Uber, Airbnb, and Tesla have all battled with regulators to get their innovative product to market, which causes many consumers to question the value of regulations at all.  The animosity between regulators and innovators has driven many to climb aboard the “all regulation is bad” bandwagon. However, there is evidence that regulation and innovation can have a more symbiotic relationship than hostile one. The nuance of how regulation can drive innovation is perhaps best exemplified in the ongoing debate over net-neutrality.

Net-neutrality is a complicated issue, and it is also one of the clearest examples of why you should never let engineers name something.  Without getting into the policy and political details, net-neutrality is, simply put, the regulation that Internet Service Providers like Comcast, Charter, AT&T etc. (ISPs) must treat all internet traffic equally, regardless of the source.  This regulation has several implications that impact innovation depending on one’s perspective.

 

How does net neutrality hurt innovation?

• ISPs are forbidden from developing internet “packages” where customers purchase access to the sites they want individually. Instead, internet customers pay to access to the whole internet in an “all-or-nothing” fashion.
• ISPs cannot institute pricing models where sites can pay more to have faster access to consumers.
• ISPs cannot give priority to their own services (like email, voicemail, or video conferencing) and thus these products are often underfunded and underdeveloped.

How does net neutrality help innovation?

• Small companies and websites have the same access to the market as large sites or sites owned by the ISPs.
• Large companies cannot horde internet bandwidth capacity to kill competition. For example, Apple iTunes cannot purchase bandwidth in a way that would limit American’s ability to access Spotify or Pandora.
• ISPs’ services must compete with any third party service on the merits of the service rather than being given priority access to consumers. Many net-neutrality supporters describe a potential dystopian example to illuminate this point. Instead of Netflix, Gmail, and Facebook, without net-neutrality we would have (likely more poorly functioning and more expensive) Comcastflix, AT&T mail, and Yellowpages Social Media.

What I find interesting is that this seemingly technical (and honestly mundane) regulation has been polarized to the point where we have a contradiction, clearly displayed by both major political parties. Both sides of the issue claim that the regulations either impede or encourage innovation, so who is correct?  Perhaps in light of the new FCC Chairman’s clear intentions to dismantle net-neutrality, supporters of net-neutrality should consider a third option, one that embraces Contradictive Thinking…

Contradictive Thinking Methodology:

Step 1. Outline the contradiction:

The Contradiction: Should regulators….

Encourage Internet Service Providers to provide more investment and innovation

or

Protect small businesses, news organizations, etc. equal access to the market

Step 2. Replace the “should” with “How can” and replace the “or” with an “and”:

How can regulators encourage Internet Service Providers to provide more investment and innovation and protect small businesses, news organizations, etc. equal access to the market?

Step 3. Use Divergent or Lateral Thinking to solve the question:

In 2010, Verizon (Anti-Net Neutrality) and Google (Pro-Net Neutrality) proposed a legislative framework with “two-lanes” where standard internet content could be delivered to customers equally (in-line with net-neutrality) while allowing broadband providers to supply their own prioritized services (such as Voice Over IP, or text messaging) as a secondary revenue stream to encourage investment.  The deal died in 2010 because at the time pro-Net Neutrality supporters had control of both the White House and Congress and saw no reason to re-evaluate their position.  However, given today’s political climate, there may be much more of an appetite to resurrect the deal.

As you can see, Contradictive Thinking is not easy, and sometimes it does not result in workable solution.  However, the methodology can be used when other avenues have failed or when two clearly opposing goals are present.  In addition, when it is successful Contradictive Thinking can create some of the most powerful innovation.

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