How can Failure motivate you

how failure can motivate you and how to motivate failure students and how failure can inspire and motivate us and how to motivate from failure
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LavanaThomson,United Kingdom,Professional
Published Date:15-07-2017
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Reprinted by permission from The CEO Advantage Journal , a publication of CEO Advisors, LLC. Visit www.tcajournal.com. e Th re is much to be learned in the study of success, but executives cannot ao ff rd to ignore the lessons of failure. By Troy Schrock Failure, a Great Teacher ICHAEL JORDAN, LANCE ARMSTRONG, Tiger get fired up to participate vicariously through the successes of Woods. New York Yankees, New England Patriots, others. That is why sports fans, for instance, talk about their MDetroit Red Wings. Southwest Airlines, Walmart, favorite team in the first person. Apple. Bill Gates, Warren Buffet, Jack Welch. We especially love the stories of those who have pulled We are obsessed with success. In sports, entertainment, themselves up by their bootstraps – people who were seemingly business, government, individual feats, group accomplish- little before they made it big. The rags-to-riches theme is ments…whatever the genre, we find, highlight, profile, study, common in our movies. The “defy all odds” script characterizes and promote the success story. In a profound way, we relate our national heroes and the legends they spawn. Put simply, to success. It awakens within us a sense of, “Hey, I could do America loves a winner. It encourages us. It inspires us. It that” At that moment, it doesn’t matter if we ever do. We drives us. 18 The CEO Advantage™ Journal 2010 tcajournal.com Lago di Como Reflections (Phil Fisher)Failure, a Great Teacher The same goes for business. Books about business and prompt leaders to study failure, and I will offer some general leadership success routinely top the bestseller lists, and in the guidelines on how to do it. last few decades, many authors have risen to meet that demand To begin, we must first understand how faulty we can be in (see list on next page). Each study tries to identify more obscure our attribution of either success or failure. successful organizations and attempts to develop yet another framework of “essential” principles for success. Each time, FAULTY ATTRIBUTION eager business leaders and entrepreneurs gobble them up. I am not surprised that the bookshelves of the last 30 years “When a company is doing well, with rising sales, high have been crowded with success stories. It has been one of profits, and a surging stock price, observers naturally infer the greatest periods of business building and wealth creation in that it has a smart strategy, a visionary leader, motivated the history of the United States and the world. We have also employees, excellent customer orientation, a vibrant culture, enjoyed a sustained period of peace in industrialized nations. and so on. When that same company suffers a decline— It has felt good, and studies on business success allow us to when sales fall and profits shrink—many people are quick to bask in the good vibes. Surrounded by success, we naturally conclude that the company’s strategy went wrong, its people focus on it. became complacent, it neglected its customers, its culture I am also not surprised that this mood has changed in the wake became stodgy, and more. In fact, these things may not of the 2008-2009 financial meltdown and economic recession. have changed much, if at all. Rather, company performance Suddenly, people are buying books on failure. Organizations creates an overall impression that shapes how we perceive its are struggling financially, customer patterns are changing strategy, leaders, employees, culture, and other elements.” 1 drastically, and the regulatory environment is more volatile Phil Rosenzweig We tend to go overboard with our diagnosis of the factors that lead to success or failure, and thus, we get it wrong. If a company Business leaders are does well, we think they do everything well. If they struggle, we assume there is room for improvement in everything. For accustomed to studying the a simple example, Jerker Denrell at Stanford University notes 2 that persistence will always be noted as a factor in success. possibility of failure, but they However, when an initiative fails, persistence will probably not are much less comfortable be acknowledged even if it played a role in the failure (i.e., stubbornness, resistance to necessary change). The reason is studying the reality of failure that we think of persistence as a positive trait, so we are not inclined to look for it in an unsuccessful endeavor. after it happens. This is important for executives to understand. The first step in diagnosing the root cause of an outcome is to get beyond the apparent, and that is tougher than it sounds. End results than ever. Executives realize they don’t have it all figured out. quickly construct the lens through which we interpret reality, All the levers they knew to pull are no longer working. Thus, and we oversimplify factors that are complex and intertwined. they are newly interested in the factors of failure. Even Jim Business does not operate in a vacuum, so outcomes are rarely Collins, the Good to Great guru, has released a book called attributable to a single variable. How the Mighty Fall. It’s a trend that will probably continue Furthermore, not all variables are within our control. Sound for some time. decisions and well executed actions can be doomed by bad This is good. We know that we learn from our mistakes fortune. Recently, I learned of an organization that was set to a Great Teacher and the mistakes of others, but until now, how many of us have close a big deal on September 11, 2001. Obviously, that deal habitually studied failure – particularly our own – to glean its did not close due to the events of that infamous day – events lessons? Probably not many. When we fail, the conventional that were completely uncontrollable and unexpected by those wisdom is to “move on” and “not dwell on the past.” Yet, the who worked so hard on the deal. Ultimately, the deal never study of failure may be the most fertile ground for productive happened. While those circumstances were extreme, similar improvement leading to sustained excellence. All entrepreneurs stories are countless. Failure is not always attributable to poor and business executives should give it serious attention. decisions or poor execution. Business leaders already understand risk, and the successful At the risk of oversimplifying, outcomes can be attributed to ones embrace it. Failure is inherent in risk, so business leaders three sequential factors: are accustomed to studying the possibility of failure on the front end of a decision, but they are much less comfortable 1. Decisions (good or bad) studying the reality of failure after it happens. The effective 2. Actions (good or bad) executive needs a balanced approach. In this article, I hope to 3. Fortune (good or bad) tcajournal.com The CEO Advantage™ Journal 2010 19Failure, a Great Teacher Suggested Books Suggested Books on Business Failure on Business Success The Loyalty Effect: The Hidden Force Behind Growth, Profits, In Search of Excellence: Lessons from America’s Best-Run and Lasting Value by Frederick F. Reichheld (1996) Companies by Tom J. Peters and Robert H. Waterman, Jr. Note: This book is not entirely on failure, but chapters 7 and (1982) 8 challenge the reader to look for and learn from failure. The Winning Performance: How America’s High-Growth Mid- When Giants Stumble: Classic Business Blunders and How to size Companies Succeed by Donald K. Clifford, Jr. and Richard Avoid Them by Robert Sobel (1999) E. Cavanaugh (1985) Why Smart Executives Fail: And What You Can Learn from Built to Last: Successful Habits of Visionary Companies by Jim Their Mistakes by Sydney Finkelstein (2003) Collins and Jerry I. Porras (1994) Greed and Corporate Failure: The Lessons From Recent Disasters The Discipline of Market Leaders: Choose Your Customers, Nar- by Stewart Hamilton and Alicia Micklethwait (2006) row Your Focus, Dominate Your Market by Michael Treacy and Fred Wiersema (1995) The Self-Destructive Habits of Good Companies: And How to Break Them by Jagdish Sheth (2007) Good to Great: Why Some Companies Make the Leap and Oth- ers Don’t by Jim Collins (2001) How the Mighty Fall: And Why Some Companies Never Give In by Jim Collins (2009) Less is More: How Great Companies Use Productivity as a Com- petitive Tool in Business, by Jason Jennings (2002) Think Big Act Small: How America’s Best Performing Companies The ultimate purpose of studying success and failure is to learn, Keep the Start-up Spirit Alive by Jason Jennings (2005) and the rapid pace of change in today’s economy makes learning more important than ever. Businesses simply cannot expect to The Breakthrough Company: How Everyday Companies Become make money tomorrow the same way they make money today. Extraordinary Performers by Keith R. McFarland (2008) Technologies change. Customers change. Needs change. Competitors change. You simply must stay on top of all this When studying outcomes, we tend to make three mistakes. change. First, we focus 80% of our time on the outcomes resulting from Even the “great” companies of the success books are a good/good/good sequence and the remaining 20% on those susceptible to the challenges of change. Critics point out that resulting from bad/bad/bad. Second, we tend to ignore the many of the profiled companies struggled after the books were element of fortune altogether. Granted, it is out of our control, published. However, an organization’s fall from success does but we can still anticipate it and plan accordingly. not negate the lessons from what led to their success. We just Third, we view the contributing elements strictly through the must be disciplined in accurately identifying the causes of their lens of the outcome (faulty attribution). A favorable outcome success, unblinded by faulty attribution. The key is learning. may have occurred in spite of a poor decision, for instance, Similarly, many organizations (thankfully) recover from but we see the favorable outcome, proclaim “success,” and periods of failure to enjoy sustained periods of success. Yet, pat ourselves on the back. Consequently, we miss hundreds we can still learn a great deal from what caused them to initially or thousands of hours, gobs of resources, and a host of fail. Indeed, their ability to recover from that failure likely 4 environmental issues that contributed to the final outcome. We resulted from their own commitment to learn what caused it. are so intent on getting the short story and moving on that we Again, the key is learning. leave behind a pile of instructive gems. As the business leader, the pattern of learning starts with you. Invest the time in knowing yourself. Establish a consistent THE KEY IS LEARNING rhythm of reviewing your own performance (I like to do this at least once per year). What did you do well? What did you “Companies can...fix problems, alter course, adapt to new not do well? What have you learned about your competencies, environments and new circumstances, even completely re- communication style, and leadership abilities? What specific build themselves. But the lifeblood of adaptive change is steps do you intend to take to improve? employee learning. (‘Organizational learning’ is a useful Do this same thing with your executive team. To survive term, but it’s only a metaphor. People learn, not organiza- and thrive, you must invest the time and resources in really tions.)… Employee learning is the vital asset that allows knowing your business and market environment. Finally, companies to change and heal themselves.” train your employees to follow suit. Frederick Reichheld is 3 Frederick F. Reichheld right: there is no such thing as “organizational learning.” Only 20 The CEO Advantage™ Journal 2010 tcajournal.com Failure, a Great Teacher individuals can learn. Your organization simply reflects the The aerospace industry does a good job of studying and learning collective efforts of its people. from failure. Commercial airlines, for example operate way Failure is a great teacher, so capitalize on it. Every beyond six sigma when it comes to the most important aspect individual in your organization should track their decisions of their business – safety. The only way to get to that level is by and actions and watch for failure. There is no guarantee that fervent study of failure and taking steps to ensure that mistakes the final analysis will lead to new actions that are consistently do not repeat themselves. successful, but over time, assessing failure in this way can only Look at the resources immediately assigned to the problem help your organization. in the NASA example – literally hundreds of engineers all In this dynamic economy, you cannot afford the “let’s just focused on one little malfunctioning fuel gauge. Does your wing it” approach. Not only are your chances of success less, organization attack failure with this level of urgency? Sure, but the benefits and consequences of the decision are more your business may not be launching multi-billion dollar space random and more difficult to identify. With a robust system expeditions, but as far as your employees are concerned, you of analyzing success and failure, you can build decisions on might as well be. For the sake of your organization’s future, previous ones, watching for patterns of success (to be emulated) you must make a habit of studying failure. or failure (to be avoided). What failures should you study? Some examples include: LOOK FOR FAILURE • A loyal customer who goes elsewhere • Good employees who leave the organization “I’ve often felt there might be more to be gained by studying • Breakdowns in delivery of a key product or service business failures than business successes. In my business, • Poor financial performance – specifically in gross we try to study where people go astray, and why things don’t margin work. We try to avoid mistakes…It’s an inversion process. • Project outcomes that fall short of targets Albert Einstein said, ‘Invert, always invert, in mathematics • Failure to achieve strategic priorities and physics,’ and it’s a very good idea in business, too. Start out with failure, and then engineer its removal.” In short, a failure is any outcome that falls short of the goal. 5 Warren Buffet Even outcomes that appear to reach the goal, however, should not be exempt from analysis. Remember to avoid the mistake Why do we not study failure more readily? I suspect the Low Tide on Naples Beach (Phil Fisher) reasons include: • We naturally try to hide mistakes. As individuals and as organizations, we simply want to look good. • Failure hurts. We do not like experiencing it, and so we choose not to dwell on it. • Success is much more fun. Whether it’s our own experience or sharing in the excitement of others, success feels much better than failure. That’s why winning teams lead professional sports leagues in attendance each year. We must fight the natural inclination to ignore failure. We’ve all heard the old adage: those who ignore history are doomed to repeat it. Studies and anecdotal experience show that disasters are rarely – if ever – unique; the indicators and preconditions tend to be the same. Investigating past failures and their root causes will help to recognize and eliminate them when they emerge again. As Buffet said so well, “Start out with failure, and then engineer its removal.” HOW TO STUDY FAILURE “Hundreds of engineers are scrambling to figure out why a fuel gauge on the space shuttle Discovery failed right before its launch, while NASA clings to the possibility that it might 6 be able to make another attempt on Sunday.” tcajournal.com The CEO Advantage™ Journal 2010 21Failure, a Great Teacher managers, and staff on analysis teams. This is the best way to ensure that you consider every aspect of the failure in question. It also maximizes your ability to think in terms of the customer, A systematic approach to as certain levels of your organization are probably in closer contact with the end product than others. studying failure begins with establishing a rhythm for CONCLUSION debriefs. As an avid reader of Peter Drucker, I have often noticed that he naturally uses examples of both success and failure to highlight various points. The ultimate goal is to identify what works, of focusing too much on the final outcome. Even bad decisions and there are lessons to be learned in both. As opposite as they and bad actions sometimes result in good outcomes. Therefore, may seem, success and failure are just different types of the every outcome – failures and successes – should be analyzed. same thing – experience. And experience is a horrible thing A systematic approach to studying failure begins with to waste. establishing a rhythm for debriefs. The United States Military does this very well, as noted by Geoff Colvin in Talent Is Overrated: Troy Schrock is a certified CEO Advantage advisor, helping CEOs and A powerful tool with great potential for most organizations executive teams in a wide range of is the U.S. Army’s after-action review. Colonel Thomas industries with team effectiveness and Kolditz, who runs the leadership development program strategy execution. He can be reached at the U.S. Military Academy at West Point, says that for at troytheceoadvantage.com. the past twenty-five years “it has literally transformed the Army.” The concept is simple. After any significant action, in training or in combat, soldiers and officers meet to discuss what happened. They take off their helmets – a symbolic action indicating that “there’s no rank in the room,” as Kolditz says. “Comments are blunt. If the boss made a End Notes bad decision, often it’s a subordinate who points that out.” 1. Rosenzweig, Phil, “Misunderstanding the Nature of Com- The session isn’t about blaming; instead, it’s “a professional pany Performance: The Halo Effect and Other Business discussion,” as an army training circular puts it. Part of its Delusions,” California Management Review, Vol. 29, No. 7 strength is that it yields very complete feedback. 4 (Summer 2007): 7. 2. “Stanford Business School Study Finds Failure is a Key Practically speaking, you may not be able to debrief with to Understanding Success,” Business Wire, August 2, your team after every significant outcome. That’s why it is 2004. This article can be viewed at www.highbeam.com/ so important to have a rhythm to your reviews. I suggest a doc/1G1-120025318. quarterly meeting where you and your team review the goals 3. Reichheld, Frederick F., The Loyalty Effect. Harvard for the previous quarter and assess your performance, then Business School Press, 1996, p. 187. set new goals for the next quarter. The simple discipline of a 4. Jim Collins offers a few good examples of such compa- quarterly recalibration meeting is possibly the most powerful nies (IBM, Nucor and Nordstrom) in Appendix 6A – 6C single step you can take to learn from failure and improve your of How the Mighty Fall. execution. Do the same thing with your annual initiatives at 5. Buffet, Warren, “Track Record is Everything,” Across the the end of the year. Where did you fail? What did you learn? Board, October 1991, p. 59. What steps have you taken as a result of those lessons? 6. “NASA Is Studying Failure of Fuel Gauge,” The Cincin- The second component of a systematic approach to studying nati Post, October 16, 2009. This article can be viewed at failure is a solid process for root cause analysis. Whether it’s www.highbeam.com/doc/1G1-134107692. LEAN, Six Sigma, or something else, a process provides the 7. Colvin, Geoff, Talent Is Overrated. The Penguin Group, discipline to search for the true source of a problem rather than 2008, p. 132. just its symptoms. Eliminating the source of a failure is the only way to ensure that it won’t happen again. For a complimentary reprint of this article, visit tcajournal.com. The third component of a systematic approach to studying failure is to involve people from throughout the organization in failure analysis. As much as possible, mix executives, 22 The CEO Advantage™ Journal 2010 tcajournal.com Failure, a Great Teacher Do the Lessons of Large Corporate Failures Apply to Midsize Businesses? During 2009, I embarked on a study of executive and With the possible exception of ineffective boards of organizational failure by tackling a number of books on the directors (which most midsize businesses don’t have), each subject. The examples in these books are primarily large of these is a real possibility for midsize companies. multinational corporations, so in my work with executives of In fact, midsize companies might even be more susceptible midsize companies, I am frequently asked, “Do these lessons to some of these than larger corporations. First, CEOs of apply to a company our size?” midsize businesses are often the founding entrepreneur; thus, The answer is definitely yes. The general causes of failure they are susceptible to seeing the business as an extension highlighted in these books include: of themselves because it really is their business. This can create an environment in which executives and employees • Poor strategic decisions are unable to properly challenge the CEO on anything – a • Unsuccessful new ventures sure-fire recipe for failure. Second, midsize businesses may • Overreaching in expanding the business be more susceptible to the failure of internal controls. They • Bad acquisitions done in the ever-elusive search for simply don’t have the resources for this function that larger synergy corporations do. • Choosing not to cope with innovation and change Beyond these, however, I see little difference in the • Failure to face reality and act on vital information susceptibility of midsize and large businesses to these causes • Dominating CEOs who see the business as an of failure. extension of their egos and personal agendas –Troy Schrock • Executive hubris • Failure of internal controls • Ineffective boards of directors Evening in the Everglades (Phil Fisher) tcajournal.com The CEO Advantage™ Journal 2010 23