Learning to Fail Your Way to Success!

Wed, Jun 16, 2010

Strategy and Execution

‘If you want to increase your success rate, double your failure rate.’

‘“ Thomas Watson, Sr. Founder of IBM

The Innovation Paradox, a book by Richard Farson & Ralph Keyes, says that success and failure co-exist and are interdependent. Innovation in today’s business economy requires that executives change their thinking on success and failure. By encouraging people to innovate – even when they have previously failed – and regularly analyzing their mistakes has kept companies like GE & 3M vibrant.

Failure breeds breakthrough innovations, reports BusinessWeek. For example, in 2000, Virgin Atlantic Airways suffered a huge failure with its $67 million investment in sleeper seats while British Airways rolled out the truly flat bed for its passengers. But instead of axing its design team, Virgin entrusted them with $127 million investment which a few years later resulted in its ‘upper-class suite’ with beds of different consistencies for sleeping & sitting. This new design helped the company gain more than 1% of the business class markets.

Venture capitalists often look for start up companies whose leaders were part of failures in their career.

At Coke’s annual meeting, Chairman & CEO E.Neville Isdell said, ‘You will see some failures. As we take more risks, this is something we must accept as part of the regeneration process.’ In order to change a risk-averse culture, Isdell tells his employees and shareholders that he will tolerate failures.

GE is another example of a company who ‘values’ failures of innovation. Patia McGrath, a GE marketing director, says ‘The notion of taking big swings, and that it’s ok to miss the swing, is something that’s quite new with GE’s CEO Jeff Immelt.’

These stories provide us with the seemingly strange-but-true message that we all must welcome failure. Failure is not the opposite of success – rather they are really the opposite sides of the same coin. Culturally we are trained to love success, which in turn makes us risk-averse. But taking risks, and experiencing failure, in the pursuit of breakthrough innovations is imperative in today’s global economy.

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