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How to fail smart

Joel Filipe

To become truly innovative, companies must learn to accept, discuss and learn from their failures, write Paul Boston and Bin Zhao for Ivey Business Journal.

For many businesses failure is a dirty word. Operating in a society where perfection is espoused and so-called “overnight success” stories are celebrated, senior managers are reluctant to admit to their company’s failures, let alone dissect the reasons for those failures, learn from them and use those lessons to drive innovation.

According to Paul Boston, performance consultant and founder of Canada’s Actus Performance Inc, and Bin Zhao, associate professor of management and organisation studies at Canada’s Beedie School of Business, Simon Fraser University, “learning from failure often leads directly to innovative products, processes, and services”.

For Boston and Zhao failure is key to innovation and therefore the success of your business. Here are their five tips for learning how to harness the power of failure:

1) “Fail smart” and “fail forward”. To fail smart is to take “prudent risks” and learn everything you can when those risks don’t come off. To fail forward is to take those lessons and to use them to inform your decision about what to do next.

“This process will lead the organisation toward a more rewarding and productive way of doing business,” write Boston and Zhao.

2) Lead by example. Senior management must not only appreciate the central role failure plays in the innovative process but also communicate to all staff members how important taking prudent risks is to growth and staying one step ahead of the competition. They must also share their own stories of failure and encourage staff to learn from, rather than fear, failure. The goal is to “create an authentic culture of risk-taking”.

3) Celebrate and reward failure. Senior management must encourage staff members to accept errors by removing punishment for failures and instead reward staff members for failing smart. This is the only way to ensure that even after failing, all staff members remain committed to achieving your company’s objectives.

Canadian advertising and marketing agency Grey Group went as far as to create a Heroic Failure Award, presenting staff members with a trophy in recognition of their failure.

Failure is only good if you learn from it and use it to move forward. It is important to put in place an effective performance management system so that staff members can learn from colleagues, clients and anyone else affected by a failure.

4) Encourage experimentation. Allow staff members the time to be creative. Giving them the opportunity to put aside routine activities in order experiment is vital to innovation.

US corporations 3M and Procter & Gamble and tech giants Amazon and Google all have innovation programmes that allow their staff to dedicate a portion of their working hours to experimentation.

5) Hire people who want to learn. Seek to hire people with an entrepreneurial spirit who relish a challenge and are eager to learn. People who are interested in personal development rather than climbing the greasy poll are more likely to embrace a culture that encourages confronting, discussing, learning from and making use of failure.

Don’t fear failure

Fear of failure is a “brick wall”, preventing many organisations from innovating and capitalising on opportunities. “As innovation leaders, managers and organisations need to build a culture that removes fear of failure and directs employees to pursue innovation through failing smart and failing forward,” write Boston and Zhao.

Source Article: Failing To Innovate
Author(s): Paul Boston and Bin Zhao