Failure shouldn’t come as a surprise

By Julia Austin, Senior Lecturer, Harvard Business School; Former VP Innovation, VMware

austin-featuredI’ve worked at startup companies and I’ve run development teams inside large public companies. In both environments, executives spend far more time forecasting how successful they’ll be than planning what they will do if something breaks down.

And yet the odds are, with every project that pushes the limits of what your company has done before, or the boundaries of what is possible, you will encounter failure. The best organizations in the world expect it. They have a culture that tolerates it. And they are ready to learn from it and adapt.

Here’s my advice about how you get there.

Identify the weak spots
. In a startup or a big company, there will be times when you’re heading into uncharted ground. Instead of just identifying KPIs (key performance indicators) for success, consider also identifying potential weak spots or areas most likely to fail, and sketching out a plan for how you’ll learn from these and address them. This is especially important if you are doing something experimental, whether it’s with a brand new team just figuring things out or a mature team trying to enter a whole new space.

Culturally, being able to say “this could break, but we have ideas on how we’ll fix it,” or “we want to see if it breaks to know what our limits/constraints are, and we have ideas on how we’ll address it” conveys a humble and practical approach to failure. By accepting the likelihood of small or big failures as a consequence of operating on the edge, you are establishing a culture that knows how to handle failure when it happens, rather than just playing the blame game.

apple-newtonExpect to iterate. Very few big ideas made it out of the gate successfully after the first, second, or even third try. Consider the Apple Newton as a prime example. Any time a new idea is being explored – whether it’s a new product or a new sales strategy – you should assume it’s going to take a few iterations to get it right, and that there is a high likelihood the first few tries will fail. Create opportunities to iterate towards a good solution, without a lot of exposure or casualties.

How do you create these opportunities? Here are a few ideas:

  • Roll out a new product to a few trusted “alpha” customers who can experiment with it, and who are willing to give you candid feedback. Have a process in place for them to report bugs, discuss user experience, and try different usage scenarios as your team continuously improves the product based on their feedback.

  • Have two small teams try two different approaches to a product challenge – a bake-off, if you will – to see what ideas come together once the two solutions are presented side-by-side. Often, one team’s failure to deliver on a certain requirement inspires the combined group to come up with something even more brilliant. It is important to foster healthy competition, where both teams are rewarded for landing on a successful solution that incorporates ideas from each approach. Failure or shortcomings in this case eventually yields success.

Take care of your key constituencies. Employees are your biggest asset, and spending their time and energy on something that doesn’t work out shouldn’t have consequences for their career, or their reputation within the company. Your customers are your second biggest asset. Keep them happy. Be responsive and own the problem, even if you think they are the ones that failed and not your product.

Be transparent. If you plan for and accept failure as a part of scaling your business, then you should be as transparent as possible about the entire “failure life cycle”:

  • What-if prep: Go into any new program or strategic direction with a communication strategy. It’s good to have a “who will we tell what to, and when” plan. It may be organized simply as internal (employees) vs. external (customers, partners, press) communication. Know who’s on point if/when something happens, and how loops will be closed, e.g., someone is managing a list of who hass been told what until it’s done.

  • The aftermath: Conduct a post-mortem to identify the root cause of the failure, and discuss how to handle similar situations in the future. For example, say a nasty program bug caused your company’s user data to be hacked (eek!) Identify how that bug got in your production system, and what tests you’ll put in next time to prevent bugs like that from occurring. But also, evaluate how the bug was caught, communicated, fixed, and handled with customers. The outcomes of these evaluations are just as important to communicate as the issue itself – both internally and externally. Transparency creates trust.

Many people seem superstitious about even talking about the possibility of failing. Maybe they believe if they whisper the word, it will be a self-fulfilling prophecy. But I believe that more “evolved” corporate cultures that excel at exploring new markets and launching new products accept failure as a cost of doing business, and they don’t treat it like a surprise. Just as airline pilots train for handling emergencies, and sailors know what to batten down when they encounter storms, great companies expect that new ideas will often hit potholes and require some repair work before they prove to be big winners.

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This article originally appeared in the Fall 2015 edition of Innovation Leader magazine, as part of a collection of stories on failure.

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