Making Learning from Failures a Reality

Reflection on “Seven Ways to Fail Big” by Paul B. Carroll and Chunka Mui

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Unlike much literature published about the practices of successful companies, this article discusses lessons from “the most inexcusable business failures of the past 25 years.” The authors examined 750 of the largest business failures and grouped failures into seven categories with the hope of teaching through failure instead of teaching only by successes that may be incorrectly applied to dissimilar businesses or scenarios. This article is right at home in a time where companies like Coca Cola, Netflix, and Amazon advocate learning from failure (https://hbr.org/2017/11/how-coca-cola-netflix-and-amazon-learn-from-failure) and agile methodologies emphasize testing and failing before building. Reporting on failures is important also for identifying successful strategies or approaches that might not be overlooked given the bias of talking about lessons learned from success. This bias seems similar to false positives and incorrect hypotheses caused by ‘publication bias’ in the academic publishing field (https://en.wikipedia.org/wiki/Publication_bias).

The two most interesting recommendations for me were the idea of an independent panel of devil’s advocates to explore the holes in a strategy during the planning process and investigating and vetting the reason why strategies are pursued. These two recommendations, while seemingly simple, are incredibly difficult to achieve. They both require a culture of brutal honesty and the ability of a team to 1) not become defensive about the merits of their strategies and 2) to create strategies which are aligned and created with a strong sense of direction and vision. These two things become difficult if people’s jobs, promotions, or pride is on the line. When you’ve been advocating for a strategy for months to build consensus, how can you form a culture where you can also take a step back and allow others to question your ideas and decision making?

In the podcast Worklife, the host, Adam Grant created an episode about radical transparency in the workplace (https://www.ted.com/talks/worklife_with_adam_grant_dear_billionaire_i_give_you_a_d_minus/). The case study is about Bridgewater, a successful hedge fund that has promoted and advocated for immediate and totally honest feedback. Instead of being seen as negative, feedback is seen as a gift and as one of a few ways to improve yourself and your work performance. Here, a process like the one described might work incredibly well. The podcast notes that many at Bridgewater find the culture intensely challenging and too intense, in part because of the directness and harshness of the feedback given. I wonder if there might be a way to translate the idea that a feedback culture can lead to improved and expedited continuous learning and introduce it to more companies in a form that is palatable while still effective.