How to recover from failure
Learning from failure is a critical attribute for people and businesses. The reality is that success can breed failure by hindering learning at individual and organisational levels.
The annals of business history are full of tales of companies that once dominated their industries but fell into decline. The usual reasons offered – not staying close to existing customers, holding a myopic focus on short-term financial performance, and being unable to adapt business models to disruptive innovation – don't fully explain how the leaders who steered their businesses to success have lost their winning touch along the way.
We all know that learning from failure is one of the most critical attributes for people and businesses. The reality is that success can breed failure by hindering learning at both individual and organisational levels in several ways:
When we do well and succeed, we tend to give too much credit to our talent, business models, or strategic ability. We give too little credence to external factors and good old-fashioned luck.
Success can often make us so confident that we believe that we don't need to change anything in our business.
We all tend to analyse when we do badly and fail, but we don't investigate the causes of good performance.
Recognising that these obstacles exist is a big step towards overcoming failure. When you think about it, accepting failure shouldn't be so hard. After all, our entire human existence is based on failing. We fell many times before we learnt how to crawl; and then started falling again before figuring out how to walk. It's how we evolve as humans. Yet early on in life, whether through our education system or our culture, we're taught failure isn't good enough - that we must always win, and that failing is wrong. We're rewarded only for 'A' grades and following the rules.
But fear of failure isn't going to sustain us anymore. We live in an era of constant innovation. Businesses can no longer wait for the dust to settle, or pauses in innovation cycles, to craft and market test strategies and products. They need to be constantly in the mix - trying, and failing.
The trick is learning to tap back into that willingness to fail that we were born with and the great lessons that come with it.
Here are a few tools that you and your business can use:
1. Celebrate success but examine why you are (or were successful)
There is nothing wrong with celebrating success, but when you stop clinking the champagne glasses you should investigate what led to that success with the same scrutiny that you would agonize over a failure.
You may, for example, learn that success was achieved by fluke. Strokes of luck happen to every business and every person. And fluke is hard to replicate.
2. Fail fast
Quick, decisive failures have enormous benefits. First, they can stop you from throwing good money after bad. Secondly, it's much easier to establish cause and effect when actions and outcomes are close together in time. And lastly, an early failure lessens the pressure to continue with the project/business regardless because your investment is not that large. Remember that sunk capital cannot be returned.
3. Build a business culture that analyses failures
Most people are afraid to fail. Business culture reinforces that fear. But as many successful businesspeople have discovered, failure is a prerequisite to success. Failure-tolerant leaders send clear messages to their companies that mistakes are not only acceptable but worthwhile.
They should help employees see their work in a greater context, and that if they mess up that it's part of a strategy to get better at what they do. Instead of using praise and punishment as tools, they should deeply analyse what went wrong by asking non-judgmental questions. They must build a culture that encourages people to share their ideas about what went wrong, why, and how to avoid mistakes in the future.
4. Don't be so hard on yourself when you fail
As a business leader, you should stand up and admit when you are responsible for a failure. But don't be so hard on yourself that you don't stand up again.
Fear of failing can cause you to avoid making a decision, which often results in lost options rather than better outcomes. Also, by not making decisions, your decision-making abilities can never improve, causing every decision to increase self-doubt. Commit to learning from every decision, good or bad.
Make sure you spend time knowing that failure is temporary and that you can and will bounce back.
5. Get help
Call on experts to advise when you don't know what to do. There is nothing wrong with asking others for assistance
One of the best ways to improve as a decision maker and leader is to ask people you trust to analyse your failures and guide your learning.
Also, it would help if you accepted feedback with humility and without defensiveness, with a commitment to finding a pocket of success in every failure.
6. Remember to approach "risk-of-failure" intelligently.
Every time you choose in life, even non-choices, you are taking a risk. Use past failure experiences to inform the present and positively influence the future.
Start with small steps that lean into your uncertainty and discomfort. Make uncertainty and discomfort your growth indicators.
Carrying out small "experiments" is a great way to evaluate the "risk of failure." Test interest in a new product before you spend money building it by presenting it to the market in a blog or through crowdfunding. You can fail quickly at a very low cost if you see no interest.
7. Determine worst-case and best-case results before decisions.
Failures teach you to understand the worst case before jumping to a decision based on your best-case assumption.
Suppress your ego and bring in those advisors and experts to test your assumptions and improve your decision-making skills. Always manage the downside first.
8. Use emotions in making decisions, but don't bypass logic.
As a human, you will always feel negative and positive emotions, but they must be only one tool in a decision. You must always move beyond emotions to include logic in successful choices. Analyse and learn from failures to separate logic from emotion.
For example, we often meet aspiring entrepreneurs whose emotions are so strong toward a new idea that they forget to evaluate the business viability. They may believe they have a cure for world hunger but forget that hungry people rarely have money.
In summary, we all have setbacks in business - the challenge is to learn from each one to improve skills and decision-making, rather than let failures get you down and reduce your chances of ever achieving success.
The best entrepreneurs and business owners have experienced failure multiple times before bouncing back to a level of achievement they only dreamed of.
For example, most people don't realise that many billionaires, including Walt Disney, JK Rowling, Elon Musk and Richard Branson, experienced multiple business failures before becoming recognised business leaders. Warren Buffett has often said he would not invest in any business where the owner hasn't failed at least twice.
Yes, we all know it: rejection, losing, failure. Nobody strives for them. No athlete sets out to fail; no entrepreneur's goal is insolvency. But as if an act of divine mercy, there are positives to be found in the negatives. Successful people often preach about the value found in failure.
Denis Waitley said it well. "Failure should be our teacher, not our undertaker. Failure is a delay, not defeat. It is a temporary detour, not a dead end. We can avoid failure only by saying nothing, doing nothing and being nothing."
The mark of a successful person lies in their response to negative situations. They lick their wounds but stay on the battlefield. They find strength in their scars.