Some of the most complex and challenging problems that arise for educational leaders are actually “leadership dilemmas.” This type of dilemma, which must be owned by the leader, contains a strong tension between a desire to achieve the goals of the organization and simultaneously preserve positive relationships. Performance appraisal is one of the main contexts in which this dilemma arises for the leader. In most cases it is not recognized or is avoided because of its potential to create conflict and unpleasantness. Common avoidance approaches include polarizing the strands of the dilemma and attending to either an organizational demand or a relationship concern, and in such cases the problem is only partly solved and resurfaces at a later date. Because there is often a high level of anxiety experienced by both parties in staff appraisal situations, the avoidance of dilemmas is ubiquitous and poor performance is not confronted. Consequently, many significant issues that impact on student learning are not attended to effectively, and these problems persist and recur. When educational leaders are motivated to deal with these extremely difficult problems, they must engage in a learning loop that allows them to reflect on and change values that do not lead to long-term problem resolution. They must be willing to surface and confront the conflict inherent in a leadership dilemma. This involves understanding the nature of a leadership dilemma and being able to analyze the defensive theory of action that blocks learning when conflict is present. It involves knowing about and practicing an alternative theory of action that can guide efforts to be productive in addressing the problem. In order to manage leadership dilemmas, specific skills for double-loop learning, such as the Triple I approach, must be acquired and internalized so that productive conversations can occur.