Hear from Professor Rita McGrath, faculty at Columbia Business School Executive Education, on why companies should think about the notion of failure differently.
Professor McGrath is the faculty director of Mastering Corporate Entrepreneurship, a seven-week online program about creating, developing, and sustaining innovative new businesses by capturing opportunities fast, exploiting them decisively, and moving on even before they are exhausted.
I’d like you to be thinking about the notion of failure differently. In uncertain environments, stop worrying about the rate of failure – you can afford a lot of failures if they’re cheap.
The first principle, you want to know what success would look like. You’d be amazed at the number of companies I work with who say: “well we’re not quite sure what success would look like but we think there’s a great idea over here,” and they get way down a track without ever having really thought about it
Next is to focus on converting assumptions to knowledge and learning, rather than trying to prove how right you are. There’s a lot of breath and time wasted in organizations by people saying “I’m right you’re wrong” and defending what they’re right about. The point is, you don’t know – and being right has absolutely no place in a context like that. Also, it’s a good idea to limit the amount of uncertainty you’re dealing with at any one time – because if it’s too uncertain – if I’m a book publisher who wants to go into genetic engineering, there’s just too many variables – I’m not going to make any sense out of what I’m seeing.
Lastly, you want to be able to codify and then share what’s been learned. The best practice here comes from the military, and it’s documented in a process they call the After Action Review. And that process is one of saying: what did we intend to have happen? What happened? Why did what happen, happen? And what are some lessons learned for next time? The principle here is: have some way of talking about intelligent failures that allow you to go after them in a less fearful way than if we go at it with a typical corporate mindset.
Rita McGrath is the faculty director of the Mastering Corporate Entrepreneurship online program at Columbia Business School Executive Education.
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