Failure: What Can Businesses Learn When Things Go Wrong?
Failure has long carried costs and stigma, both personal and professional. In some business sectors, though, notably the technology industry, failure has become acceptable, even fashionable. It’s inevitable that people who try new things will not always succeed. Fear of failure stifles creativity and innovation, advocates say. Bankruptcy has become a business decision, rather than a cause for personal shame, and it can allow firms to become stronger and more nimble. Nonetheless, critical oversights and bad financial moves still hurt entrepreneurs, shareholders, workers and communities. Among the questions under debate: Is failure good for the economy? Is failure necessary for long-term success? Are there cultural and regional differences in how people react to failure?
Vicki Elmer, a longtime freelance writer for The Washington Post and contributor to SAGE Business Researcher, has written an in-depth report on the cultures of success and failure in the global business world. Below is a small section of her report.
Lessons from failure last longer than those based on success, a University of Colorado, Denver, researcher found, based on his study of rockets and airlines. “Whenever you have a failure it causes a company to search for solutions, and when you search for solutions it puts you as an executive in a different mind-set, a more open mind-set,” said Vinit Desai, an assistant professor of management who also has studied failure in other sectors.42
Not everyone learns from failure, though. Entrepreneurs need an “intuitive cognitive style” and mentoring to really extract valuable lessons from their huge mess-ups, entrepreneurship professors Brandon Mueller of Oklahoma State University and Dean A. Shepherd of Indiana University found.43
Many serial entrepreneurs continue to be overly optimistic and do not reflect on their missteps, so they fail a second time, according to others who have studied the process.44 And even though the start-up community has embraced the “fail fast” mantra, it really applies to the little details of an enterprise, not the big things, wrote David Brown, co-founder of business accelerator Techstars.45
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Vickie Elmer has experienced failures—see the never-ending Detroit newspapers strike of the mid-1990s and her short time at the Indianapolis Star. And she has had ample success, as an editor at Newsday and the Detroit Free Press and as a longtime freelance writer for The Washington Post. Now she writes about business, careers, failure and leadership for several media outlets and hopes her side project—a teen artists’ careers nonprofit in Detroit—lands in the successful column of her life and work. She has written reports for SAGE Business Researcher about Work-Life Balance, Digital Marketing and Women in Top Management.
