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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