Five Ways To Make Failure Your Best Competitive Advantage

A few weeks ago I wrote about Why Failure Is The Best Competitive Advantage. We have long been taught to avoid and run from failure but a big part of the future of work is embracing failure because ultimately this is what leads to innovation. The benefits of doing so: increases innovation, improves engagement, removes inefficiencies, and provides valuable learning opportunities. In part one of this post I talked about the “why” and today I want to talk about the “how.” That is, how can organizations go about making failure a powerful competitive advantage. There are a few things companies can do.

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Understand that failure is not the same as bad work

 

I mentioned this in part one of the post but wanted to expand on it here. Doing bad work is not the same thing as failing. If employees do good work, try hard, and still fail that’s not the same thing as slacking off, and failing. Organizations must realize that encouraging and embracing failure also means making sure that employees do a good job, and if they fail in the process then that’s ok but this does’t remove accountability and responsibility from the equation.

Give opportunities to fail

I wrote about how Adobe gives all of their employees the opportunity fail with their KickStart program where any employee can be given $1,000 to test out an idea. Linkedin has a similar model with their INcubator program, as does Dreamworks, ATT, Whirlpool WHR -0.5%,and many other companies. The key here is to give opportunities to test out an idea, get some experimental capital (when it makes sense) and to see where the idea can go. Sometimes these ideas can turn into new products and services but many of them end up failing and that’s ok. For companies that don’t have internal innovation incubators that’s ok too. Just because you don’t have an internal “lab” set up doesn’t mean you can’t embrace failure as well.

Examine failures

In order to turn failure into a competitive advantage it’s important to understand why a failure happened instead of just dismissing it and moving on. Was it a product feature? The wrong market? An outdated approach to doing something? A poor experience? A pricing issue? Failure is a great time to ask questions to get new perspective and generate better ideas. It’s just like being a scientist in a lab who is trying to find a solution to a complex problem, you test out ideas and build on top of them but this all starts with asking questions. Schwab does a great job of this by doing a failure debrief. All failed employee innovations are also displayed for others to see and new employees get a videotaped orientation of these failures along with lessons learned.

It’s important for employees to know that failure is ok this means organizations much teach this both formally through education programs and informally through the behavior of management. Adobe does this with their KickStart program, GE recently started doing this by adopting the Lean Startup approach, and Whirlpool does this with their Innovation Management System (and their processes). If you want to encourage failure you need to teach employees what this means and give them a framework and a process for how to approach failure and learn from it.

Showcase the failures

In part one of this post I mentioned TATA which has their “dare to try award” PG&E PCG +0.88% with their “heroic failure award” and others. Most of the companies mentioned in part 1 and 2 of this post showcase failures so that others can see them and learn from them. What Schwab does with their new employees and video orientations around failure is an outstanding example of how an organization showcases failure. By doing so not only does it create a culture where failure isn’t feared but it also creates a powerful and valuable learning tool.

source: forbes.com byJacob Morgan

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