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Why and How Business Leaders Should Embrace Failure

why and how leaders should embrace failure

“Failure” is considered among the worst words (and concepts) in business practices. It connotes weakness, poor decision-making and an inability to ever succeed. But, as Leticia Mooney at Startup Grind writes, “a society that shuns failure and stops making failure acceptable also tends to discourage innovation.

And without innovation, growth isn’t possible.

There are several compelling reasons why CEOs and business leaders should re-examine their notions about failure and embrace new ways of thinking about it. Here are suggestions on how to reframe the concept of failure and leverage mistakes to create new opportunities for growth:

1. Failure involves taking risks, and risk-taking is a good thing. Yes, mistakes can sometimes be costly, but perhaps the real cost is the denial that often comes following a failed enterprise or initiative.

Like just about everyone else, business leaders “don’t like to talk about [mistakes] and bring attention to them,” notes business authors Larry Weinzimmer and Jim McConoughey. It’s more comfortable to gloss over missteps and blunders, but that’s also why “so many leaders have the same struggles over and over again.”

2. Perfectionism can lead to stasis. Leaders often equate “perfect” with “not failing.” But this overlooks the fact that, generally speaking, there’s no such thing as “perfect.” Clinging to a notion of perfectionism can result in a risk-averse culture where no new ideas are ever attempted. And while it’s true that you can’t fail if you never try something, you also can never hope to move forward.

3. Use failure to shift your perspective. CEOs and business leaders often have a “control freak” mindset. If for example, they’ve created a business from scratch, they can point to a fairly good track record of controlling everything so far and succeeding in their efforts.

The hard truth is, you can’t control anyone or anything, except how you deal with failure.

“Obsessing over your failure will not change the outcome,” notes leadership consultant Susan Tardanico. “In fact, it will only intensify the outcome, trapping you in an emotional doom-loop that disables you from moving on.”

By shifting your perspective towards the future, rather than past mistakes, she adds, you can escape that negative cycle “and leave these debilitating, monopolizing thoughts behind.”

4. Learn from failure. Every setback offers a learning opportunity, if for no other reason than you now know what not to do in a given situation. In this respect, failing paves the way to new strategies and risk-taking techniques that build on what’s gone before.

When things go wrong, effective business leaders seek out the hard lessons learned from the experience. They are “unafraid of failure,” because they understand that “without taking risks, change and innovation simply aren’t possible.”

5. Failure highlights the benefits of getting outside guidance. Even with the best of intentions, it’s sometimes difficult to escape a cycle of mistakes and setbacks.

In such circumstances, it’s often a good idea to seek a fresh perspective—and that’s where a peer advisory board comes in. In such groups, business owners learn and benefit from mistakes and growth strategies other owners have tried before them.

As members of a TAB Business Owner Advisory Board, for example, members get practical, real-world, tried and tested solutions to the pressing issues every business owner faces—from successful strategic planning to the recruitment and retention of high-performing employees.

Failure doesn’t have to be an ugly or unwanted thing. And it certainly doesn’t have to be faced alone. Find out how having a network of forward-looking colleagues can help point the way to success by joining a TAB Board today.

 

Secrets of Silicon Valley

When Secrets of Silicon Valley, from Deborah Perry Piscione, first came out, I put in on my Amazon wish list. However, as I started tracking the reviews, I saw some on the average side.  I decided to get it at the library instead and I’m glad that I did. It’s an interesting book but I don’t see myself going back to it. That being said, I wanted to share a few nuggets that stood out.

Takeaways

Ms. Piscione relocated to Silicon Valley from the DC area in 2006. Therefore, her insight reflects both an objective outsider’s view but also the view of someone who has started several companies in Silicon Valley on her own. She identified the following areas as the key ingredients for why there is so much innovation:

  • The importance of Stanford University – both on its founding philosophy and on its continued focus on innovation, incubation & business partnerships.
  • Silicon Valley

    Silicon Valley

    The people and the culture. This includes the natives as well as the many innovators – especially south Asians – attracted to the area. Over 50% of Silicon Valley start-ups are led by immigrants.

  • The cycle of innovation. There is a constant flow of new companies doing groundbreaking technology work. However, what really seems to be part of the juice in the Valley are the big successes – you hear so many references to Google, Apple, HP and Intel. There are also smaller but equally innovative companies such as Tesla and IDEO. But the thought of creating the next Apple drives a lot of energy.
  • The acceptance of failure as a badge of honor. Failure in business is frowned upon in many cultures. In Silicon Valley it is almost expected that you’re going to fail, probably multiple times, before you have success.
  • The business model philosophy. The author argues that when start-ups are seeking funding in other markets, the question is “how will you generate revenue?” In Silicon Valley, the question instead is asked “how will you create value?” Of course, the venture capitalists want a great return on their investment – that is, value leads to revenue. But you can see in companies such as Instagram, YouTube and Facebook, that value came well before revenue and these companies were well-rewarded for their established value.
  • The sophistication of the venture capitalists – especially those on Sand Hill Road.
  • The services infrastructure: having a network of law firms, banks, accounting firms, investment banks, consultants, incubators and headhunters that have structured themselves to support a fast-faced, very dynamic business ecosystem.
  • The informality. In reading Steve Jobs biography, I was fascinated to learn how frequently he would be seen taking walks around his neighborhood, often with other well-known entrepreneurs & technologies. “Secrets” explains that this is just part of the fabric of Silicon Valley. It is an informal culture where even the most successful people are friendly and willing to share. The Valley’s well-known meeting places, where many successful ventures have been launched, and lifestyle all contribute to the fabric of innovation.

Review

Ms. Piscione references various interesting insights on innovation and creativity throughout the book. She contrasts innovation with invention and improvement in that “innovation refers to the notion of doing something differently rather than doing the same thing better”. She cites Clay Christiansen’s work in the Innovator’s DNA who identified that innovator’s have 5 key discovery skills: they are associating, questioning, observing, networking and experimenting. They are also curious, observant and ask a lot of questions. Ms. Piscione also includes her own observations that the top entrepreneurs are passionate, authentic, driven by ideas, fearless in risk-taking, trustworthy and resilient.

The last chapter explains what it is like to grow up in Silicon Valley. She cites the great educational institutions for youth, with even innovation schools for pre-schoolers, the exposure to so many business leaders and the peer culture of so many youth with interesting pursuits. The author also observes the high rate of involvement by fathers in the caretaking and education of their children.

View from TAB 

Rather than just provide the book perspective, I asked Bob French, TAB Facilitator in the area, what his observations were. He agreed with the insights with the book. He also comments that “the acceptance of failure goes pretty deep. I was part of a group interviewing a candidate on behalf of a customer for a key management position and discovered during the process that the individual had gone bankrupt. The reaction from our group was, ‘good, now he knows what it takes.’

He also clarified that, locally, the definition of Silicon Valley is now pretty well considered the whole Bay Area. Per Bob, “Innovation and tech start-ups are part of the whole ecosystem and culture here. Anybody with a good idea is welcome and the attitude is let’s hear first before we reject.”

photo credit: mninha via photopin cc