Failure is everywhere, and throughout history, it was proven to be one of the ways breakthrough progress happened. Failure is one of the probable and possible results of experimentation, and only by experimenting, we can hope for innovation. Still, when a failure occurs, is your company just fixing the problem, or taking the time to learn from the lessons, and implement them in future actions? Does your company allow for failure in its real sense, and incorporating it into its culture? In this article, we’ll go through what a culture a failure means, what is the difference between failure and mistakes, and, most importantly, what steps to take to allow for failure and rip its benefits for your organization.

What does a culture of (innovation &) failure mean

As opposed to quickly implementing a solution that is tried and tested, and it works, a culture that encourages innovation and failure allows for time so that its people can find the best way to achieve something, and never assume that this will be the best, indefinitely. A culture that is open to failure always questions the “this is how we have always done things around here.”

Besides ROI and customer satisfaction, a company that encourages failure will add to its employees and projects appraisals something around “learning” and experimentation. It will proactively ask people to think about the hiccups and what they’ve discovered and learned from them.

Such a company is also not afraid to talk about failures whenever the opportunity. Its CEO shares his failures that eventually ended up shaping the organization today, followed by its managers with their teams. It is only by continually empowering and creating a safe environment for failure that this will be a real part of business culture.

Mistakes vs. failure

Be clear about the difference between mistakes and failures. Failure is part of experimenting something, trying out a solution that one believes it could work, but it doesn’t whereas a mistake is more around neglect, poor decision-making, or just doing something wrong. Failure eventually leads to a solution when the lessons learned to help the individual or the team adjust, adapt, and innovate. Compared to this, a mistake, depending on its severity, needs to be addressed in a very drastic way or requires a time investment into educating the people on how to do things properly.

Principles of a company culture that withstands failure

While not an exhaustive list, there are a few fundamental principles that guide any culture of a business that proactively allows for failure but is also ready to make the most of them. Let’s take a dive into them and see what they mean.

Leading by examples. Management should not just share their bit of failure, but also make sure the people in their teams understand the importance of trying new solutions at the risk of getting things wrong sometimes. Employees will take the hints from their superiors around what is ok and what is not, and failure should be on the ok list.

The importance of follow-up. Ok, the failure happened, but what’s next? The principle of follow-up is about making sure you don’t just fix the problem and have a solution that works once, but you also make sure that you replicate the solution in other areas, in the future for as long as it is viable, and that the people and teams learn valuable lessons out of it. After each failure, it’s safe to assume things might happen again. That is why it’s essential to ask and discuss around “if this happens again, how will we manage things this time?”

Bring a solution. Managers should encourage employees that come with problems to also propose a few solutions that they think might work. Once these are discussed, managers can offer guidance into how to proceed, but managers shouldn’t be the ones that will automatically come up with solutions to all problems, every time.

Transparency. Not just about ideas and way of working, but people in an open culture should feel free to talk about their failures and how they found their way out. This culture of sharing will not just invite more people to speak up, but will also enforce the feeling of being safe to try and fail. Transparency is also about trade-offs. Sometimes failure happens because of limited resources – time, money, people. Ask after each failure what were the compromise and how the employee made those decisions. The whole business can learn so much out of this experience, not just from its outcome. It’s also an excellent way to learn from other’s mistakes, if you are aware of what happened, why it happened and understands what’s working and whatnot.

Failing fast. Encourage your employees to try things, but to try them on as quickly as possible in the prototype phase to check if there’s a way for them to work. If they realize the MVP is going to be a failure, they’ll start improving right away or drop the idea altogether before wasting any more time on it.

Create simulations. As long as this is possible, it’s always better to apply new ideas to simulation and see how that works. It can be a situational simulation or a production environment one, people working on that will be able to test more confidently, speak up and realize sooner than usual if that is a failure or how to improve to make it a success.

Eliminate drama and penalties. Failure should be encouraged and accepted as it is. Emotions around it should be avoided, as well as penalties of any kind. Even a bad word from a manager can discourage further innovation. Of course, managers and teams should have contingency plans for failure, but also having an honest and open, blame-free culture helps to build up all this.

Learning from others on what a culture that weathers failure means

Target

The monster retailer faced a considerable security breach scandal in 2013. During the Christmas shopping rush, they discovered their credit terminals were hacked, and around 40 million debit and credit cards details had been stolen, together with the cardholders names, addresses, and phone numbers. The data breach cost the business over $100 million in settlements with banks, Visa and a federal class-action suit, and Target CEO Gregg Steinhafel resigned in 2014.

Still, how they chose to act after this scandal made the difference, they built up their security systems, and are transparent about their actions. They also host security events and invest in communities to start exchanging threat intelligence amongst retailers.

Target faced a massive scandal because of a failure on its security system. But their culture, as well as technology, helped them survive this and grow stronger. They didn’t just fix the initial problem, but continued to follow-up and invest in their security systems to the point of becoming role models, being transparent about their actions and focusing on the positives out of this situation. Other companies would have been quiet about it, fix the issue, not invest in improvements really, and face the same kind of security issues again later.

British Airways

British Airways had to cancel all flights from Heathrow and Gatwick airports in London, during a bank holiday in May 2017, stranding more than 75,000 travelers. They blamed this on human error, explaining that a contractor turned off the uninterruptable power supply button inside the data center, and when it was turned back on, the systems had damaged data. This raised a lot of questions around the design of both the power and data back-up systems.

Human error should never be used as an explanation for failure, as it doesn’t exist. If a company hired good people to do the right things, they would act like that. It rarely happens that a good person is ignoring all the information, and did what they wanted just like that, and to cause the failure (yes, there are exceptions, like the Germanwings pilot who drove the plane to crash into the mountains).

What is the problem is that the tools and processes don’t prevent or issue warnings about the inevitable mistakes people can make. Some systems need to be automated in the first place, to avoid someone typing, for example, and making mistakes or pressing the wrong buttons. In a culture that withstands failure, such incidents are not put on someone’s shoulders but taken as they are, analyzed and learned from transparently.

Facebook

This is a very recent example, happened on July 3rd, 2019, when some photos appeared blank when uploaded on Facebook and Instagram, or sent via chat on Messenger or WhatsApp. Facebook kept constant communication on Twitter about the issue, its cause, and the status of solving the problem.

An unspecified issue had been accidentally “triggered” during “routine maintenance,” but it was fixed in a few hours. It was not the first time Facebook or its other companies faces issues, but their timely response and constant updates make the difference in any circumstance.

Lusha

It’s sad though to experience an excellent product that cannot scale, technically. That can count as a failure that unless addressed, can lead to the death of the business itself. The company I work for has recently started using Lusha, a plug-in for LinkedIn that helps our sales colleagues see the contact information of the people they look-up on LinkedIn and want to connect with. We have a business account, but no support to it. Lusha has been acting poorly in the past three weeks, our new joiners are not receiving the invite to join and use the tool, and despite our contacting the support team, the issue has not been fixed, nor we got any reply for almost a month.

We even met our sales account manager, and even he told us he couldn’t do much on the technical side. Focusing on selling without the ability to deliver, being ignorant with your customers, not informing anyone about your failures and keeping silent about it is not a culture that is built to work with failure and grow sustainably to fit its size.

These are just some example to start you thinking. Changing, or creating a culture that encourages a healthy way to failure is not easy, and there are many nuances as to what is the right thing to do and what fits the grey area. Still, asserting each failure one by one and encouraging behaviors that lead to employees trusting they can safely experiment with the risk of failing is what will make the difference long term.

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