The ROI of Failure

We have a lot to learn from failure. The state of today’s economy, business and industry in general provide a wide range of learning opportunities. We are surrounded by examples of large-scale, near catastrophic failure: the stock market, financial services and automobile industries, business closures, rising unemployment, and so on. Of course we can’t help wonder when there might be an end in sight, but maybe we can also take time to consider how we make the best of the current situation.

Failure alone is not what takes businesses under. It’s also the fear of failure that can kill an organization. It causes people to hide their shortcomings, be unwilling to ask for or accept help, or learn from and listen to critical feedback that could improve performance and results. It puts a strangle-hold on innovation and creativity, the life source of business.
In the presence of constant fear, our usual response is to run for cover. As consumers, we stop spending and we redirect our investments to safer harbors. As business leaders we baton the hatches and minimize opportunities to get it wrong. Yet, as we pull in and protect the downside, we also pull away from maximizing what might be the upside. With so much at risk, this is understandable behavior. If it can’t be executed flawlessly with predictable outcomes, then it’s not worth trying. So instead, we choose to do nothing. We delay important decisions. We defer taking action. And in so doing, we lose out on the gift of learning that failure brings.

Of course our culture doesn’t exactly encourage us to see failure as a gift, whether it’s our own or someone else’s. We’ve been conditioned to see it as an aberration, as a personal flaw, as something we must avoid. Add in the compounding pressure of the current environment, and we may become even more risk averse, resulting in a downward cycle of paralysis driven by more fear.

Prudent risk management is something every leader does, but at what point can it hinder our organization’s performance? We’ve clearly gone too far when it becomes our mentality in how we manage others and interact with our teams. We’ve gone too far when we don’t offer up that stretch assignment, when we stay too involved and over manage, or when we criticize any progress which is less than perfect. We’ve overdone it when we start to punish for failure instead of asking, “What can we learn from this?” or “What should we do different next time?” So, in a tough environment like this one, can you instead be the rare leader who offers the gift of failure?

Leaders who offer this gift create a learning culture, not by hiding failure, but by shining a bright light on it and by making it safe to inquire about and analyze what went awry. They demand answers to questions which help their organizations extract the wisdom from things gone wrong. And in so doing, they regenerate the spirit of innovation which quickly erodes in the presence of fear. The gift of failure in an organization will create a stronger, more agile business that moves forward not repeating the same mistakes over and over. To be clear, we’re not suggesting a lowering of standards or a soft line on performance. But we are suggesting a careful maneuvering between the drive to be the best and unachievable levels of perfection which feed our fears. Failure at some level is inevitable, so why not see it as an asset and go for the greatest ROI?

How to Get an ROI on Failure:

1. Set expectations: Make sure your team knows your expectations for failure and the importance of learning from it.

2. Dig deep to understand the cause of the failure: In other words, look past the presenting issue to find deeper patterns of organizational beliefs and behaviors that may be at the root cause.

3. Publicize without punishing: In other words there’s a difference between post-mortems and public hangings.

4. Practice rapid-cycle learning: The sooner you get and act on intelligent feedback, the easier it is to correct. Trade in big failures at the end for a lot of small failures along the way.

5. Share your own experiences: Maintain a climate of learning by openly sharing when you’ve made mistakes and what you’ve learned from them.

6. Keep an eye on confidence: Help others maintain confidence in their abilities in the face of failure. This will help prevent losing streaks caused from loss of confidence in ourselves and others.

THOUGHTS FROM LEADERS ON FAILURE

My great concern is not whether you have failed, but whether you are content with your failure.

- Abraham Lincoln

There are no secrets to success. It is the result of preparation, hard work, and learning from failure.

– Colin Powell

Failure is simply the opportunity to begin again, this time more intelligently.

– Henry Ford

The greater danger for most of us lies not in setting our aim too high and falling short; but in setting our aim too low, and achieving our mark.

- Michelangelo

For more on the topic, see this link on Pixar’s practices for maintaining a culture of innovation. http://www.youtube.com/watch?v=iizL2iCMe28

Spoiling the Bunch: Avoiding Bad Apples in a Bad Economy

In our experience working with executive leaders and their teams, we often encounter bad apple scenarios in the work place. For example, we will see teams where one person (the bad apple) disproportionately impacts the level of engagement and optimism and ultimately, the results of their team. We have all worked with bad apples, bullies who attack or deride to get their way, cynics and pessimists spreading doom and gloom, or the walking dead, those checked out and mentally gone but still bringing in a pay check. Maybe we’ve even been a bad apple once or twice ourselves. So, we were intrigued by new research into the impact of these bad apples and wanted to share it with you as the subject of our first blog, especially since a depressed economy provides the perfect basket for rotting apples.

Will Felps, an assistant professor the Rotterdam School of Management, Erasmus University, shared his conclusions on the effects of bad apples in the work place in a recent airing of NPR’s, This American Life. Felps asked the question, “Can one bad apple ruin a team?” The answer was a resounding yes. He grouped his bad apples into three categories – the jerk, the slacker and the depressive pessimist—and explained how each one can quickly turn a potentially successful team into a negative, dysfunctional mess. Not only did teams inserted with the bad apple perform worse, but they also tended to take on the negative characteristics of the bad seed. So, the teams not only performed poorly but they felt bad about their team experience as well. His research also discusses the critical team processes that are most impacted by bad apple behavior: motivation, cooperation, conflict, creativity and learning -- all essential for high-performing teams. And in a bad economy, who can afford to leave these assets on the table?


We found the research particularly relevant as we are in the midst of a struggling economy. Working in an environment of no raises, no bonuses and no promotions can bring out the bad apple tendencies in most anyone. As executive coaches, we asked ourselves what executives can do to stop bad apples from spoiling the whole bunch in a rotten economy.

First, control what you can. When uncontrollable forces like recessionary economics come our way, we feel powerless to make a difference. What you can control is your team’s morale, engagement and discretionary effort, all indispensible levers of team performance. When employees are hearing about soaring jobless rates, watching their co-workers get laid off, or experiencing financial hardships, it is difficult for them to find things to feel good about in the work place. Some become the depressive pessimist, rolling their eyes at new ideas and future projects. Others react to this work climate with anger and become more verbose, bringing out the “jerk” side of their personalities. To compound this effect, good employees may be less willing to challenge these types of behaviors for fear of rocking the boat in already rocky waters. The result is team cynicism, the silent killer of morale.

Second, remember you get what you tolerate. Winning teams become stifled when bad apple behavior is allowed to persist. Because of the spill-over effect, team member behavior tends to sink to the standard set by the lowest common denominator. Research has shown that team performance is best predicted not by the strength of the highest performer, but by the weakness of the lowest performer. In other words, when it comes to attitude, teams are only as strong as their weakest member. We see this dynamic in our coaching time and time again. Bad behavior is justified and tolerated, usually because the culprit has a history of good results or possesses a highly valued skill and is assumed to be indispensible. Our suggestion? Don’t tolerate it. It’s appropriate to give a couple of warnings and some good coaching, but if it persists, the leader must take swift action.

Finally, be the example. True leaders, even on their worst day, will present a positive, confident attitude to their peers and employees. Communication at work is reciprocal and moods are contagious. Remember that if the leader uses negative, critical language, others will respond with the same. In Felps’ study of sending bad apples into student work groups and observing their behaviors, he found the only group that managed to overcome the effects of the bad apple was the group with a very influential, positive, confident leader. The leader, even when frustrated, continued to ask questions, stay positive and keep focused, thus diluting the effects on the group as a whole.

It’s easy to be cynical and negative at work. You get quick laughs and build camaraderie with other discontents. And, in most organizations, frankly, there ARE plenty of things that don’t work well. It’s also easy to check out, to pretend none of it is important to you. And while humor is essential on strong teams, some of the mean-spirited banter we observe is one step from the schoolyard bully. As a leader, you must create an environment where everyone can do their best work and where the quality of the team helps people solve bigger challenges, get results and feel good about it.

TRIspective Offers These Additional Thoughts on Avoiding Bad Apple Situations:

Set the standard: Clearly communicate your expectations to the team. This preventative measure solves a lot of future problems.

Give immediate, unequivocal feedback: Make sure the culprit understands the impact to the team and your no-tolerance policy. For some this will result in a quick turnaround.

Take action on non-adopters. Appropriate action can range from firing to performance plans but there must be consequence to the behavior.

For more resources on preventing bad apples in the work environment:
The TRIspective Group www.trispectivegroup.com