Failing Fast Is Fine — As Long As You're Failing Well, Too

How to tell the difference between good and bad failure


Many thought leaders will tell you the importance of failing fast — the ability to make changes, learn from them, and iterate to make a better version, all before your competitors catch on.

But there’s a difference between simply failing and failing well. A good failure is one that takes a measured step in an unknown direction; it's a controlled experiment that may or may not pan out but will result in significant learning either way. Good failures become a trail of breadcrumbs, leading you to the next best course of action.

Bad failure is messier. It’s an unplanned leap in the dark. Its objectives are unclear, and its outcomes are difficult to quantify and learn from. Bad failures easily pull companies into greater uncertainty. All in all, it's a time-suck and a drain on your company's budget and resources.

So all you have to do is choose the good failures over the bad failures, right? Well, it isn’t as simple as that. In order to create learning experiences — not just flat-out failures — you have to be able to discern good experiments and risks from poor ones.

If that's your goal, here are two things to keep in mind:

Don't make failure an F-word.

If you want to fail well, you can't fear failure. But when trying to predict which actions are going to lead to good or bad failures, business leaders have to weigh risk against reward for the company and for themselves. This dynamic can create a situation in which leaders may fear damaging their own personal brand in exchange for uncertain outcomes.

In fact, the fear of uncertainty is bolstered by biology. In a study by Dartmouth College researchers, 61 participants were tested for their uncertainty tolerance. Brain scans revealed that those who feared uncertainty had significantly larger striatum, an area of the brain where anxiety is fueled.

Some companies are recognizing the need to embrace failure, and it’s paying off. Take Toyota, for example. The motor brand is well-known for innovation, not just in its products, but in its processes. On the Toyota production line, failure is a crucial part of success — employees are encouraged to flag mistakes in the assembly line, triggering an immediate problem-solving session. The issue must be addressed and fixed before production can continue.

Lack of control makes failure difficult to embrace. But if leaders can educate themselves on the differences between good and bad failures, they can manage their fear response and start planning the experiments that will lead them to success.

Get scientific.

There's a reason conventional scientists have their own tried-and-true method for experimentation, but there's nothing stopping other entities (like your business) from borrowing from it. Companies that fail successfully go about it scientifically by plotting a series of experiments and risks much like the scientific method into their overall strategy.

Start with a hypothesis — a testable statement about an action that could benefit your business. If a peer or supervisor asked what you're testing and why, would you be able to tell them? If you don't have an actual benchmark to rely on, you're just experimenting aimlessly, and that's a recipe for a poor failure. Go about testing this hypothesis to either validate or disprove it. If the hypothesis sticks, feed that action back into your strategy.

But a hypothesis is, of course, just a starting place; it's not worth much unless you've actually measured the results of your experiment. Are processes taking less time, or are they just becoming longer? Are you seeing more or less revenue flow through a department? How are employees and company leaders alike responding overall to this experiment?

But if you really want to get to the bottom of how this failure fares, you have to talk to your most important stakeholders: your customers.

For example, Chris Heivly, founder of The Startup Factory, tells his employees and clients to get out of the office as much as possible during the startup phase (read: the grandest experimentation phase of all) of any business. When he was first building The Startup Factory, he spent most of his time taking entrepreneurs out for coffee and picking their brains about what they needed. This strong connection to his target user base meant that he never clung on to ideas that didn’t work — he failed quickly, testing incrementally until he found a model that suited users perfectly.

Not all failures were created equal, so don't mistake any old failure for one that's productive. The key to failing well is remaining conscious of your efforts, embracing the idea of a 'good' failure, and preparing for it. This kind of planned experimentation ensures you don't just fail fast — you fail in a way that makes you and your staff wiser in the long run.

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