Dan North once said: "Fear leads to risk, risk leads to process, process leads to hate...and suffering and Gantt charts." I've worked for many companies (banks, financial institutions, and government) and most of them do not have the type of tolerance for failure. As a matter of fact, they encourage a "blame game" culture - people point the finger at the person who makes the failure. In these companies I was told that if you are the person that is given more bad news than good news to the boss, then you will be labeled as incompetent. The first thing out of my boss mouth when he noticed a problem/failure was, "Who did it? Who's responsible for that? Who's fault is it?" In these companies, if there was something wrong, people would fix it and didn't tell anyone. This created a nightmare when there were bugs on the system because no one would admit to the problem or how it happened. For the last five years, my career took a different turn. I joined a startup and eventually I end up in management, and I found a different paradigm, "failure is part of the business."
According to Harvarv Business Review, there are different type of failures:
- Preventable: this is when it could have been prevented. For example, testing in production, deploying code before testing it, logged in as root and doing an "rm -rf /".
- Complexity related: a large number of organizational failure are due to the inherent uncertainty of work: A particular combinations of needs, people, and problems may have never occurred before. Although serious failures can be averted
- Intelligent: failure when experimentation is necessary. An example will be like "spike" in Agile.
Intelligent failures are normal in startups because you are trying something that hasn't been tried before. The company IDEO has the slogan:
Fail often in order to succeed soonerThis is something that not so many companies have. Entrepreneurs embrace failure and uncertainty. In startups, there is just too much uncertainty and as Steve Blank puts it,
In a startup no business plan ever survives first contact with customers.So what happens if the original business plan fails? An entrepreneur adapts! He/she learns what went wrong, makes adjustments, and then monitors the new business plan. This means that failure is a natural part of doing business.
I am sure that all these previous businesses are aware of this issue. Obviously, they want to learn from their mistakes and avoid them in the future. But more often than not, bosses get irritated when a person presents them a problem. This is the difference between startups and stablished companies. As per HBR, companies can learn through three different activities:
- Detection: the should be to surface failure early.
- Analysis: find out what is the root-cause of the problem, or in agile terms: root-cause analysis (RCA).
- Experimentation: try to generate intelligent failure for the express purpose of learning and innovation.
It is rare for a business to be an overnight success. There are just a few FaceBook and YouTubes out there. It is going to be hard, and for many failure is the beginning of the journey. As per North, "uncertainty isn't just about expecting change, it's assuming that some unexpected bad thing will happen during the project and we can't even know about them when we start."