Why you have to lose to win

26 August 2010
According to new research from the University of Colorado Denver Business School (UCD), failure could be better than success in the long run. On reading this my immediate thought was that these researchers clearly didn’t examine the progress of the England football or cricket teams, because if you follow this logic their collective failure over multiple decades should have made them almost unbeatable by now. The academic study looked at space rocket and shuttle launches, where it is hard to cover up accidents and mistakes. The response to two space shuttle incidents, the Atlantis and the Columbia, were compared. During the Atlantis mission, a piece of insulation broke off and damaged the ship, but there were no other consequences, so the mission was considered a success. But when a piece of insulation fell off the Columbia on a different mission during 2003, it led to a major disaster. The events of the Atlantis mission produced little follow-up or investigation, while the Columbia tragedy resulted in the immediate suspension of shuttle flights and 29 recommendations to prevent it happening again. Vinat Desai, assistant professor of management at UCD, who led the study, says the airline industry is one sector that has learnt from dreadful errors to greatly improve safety. “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 mindset, a more open mindset,” he said. It reminds me of a story I once read about former GE boss Jack Welch. When one of his employees made a mistake that cost the firm $10 million, he was urged to fire him. “Why would I?” was the business guru’s response. “I’ve just invested $10 million in his education.” Desai does not advise failing deliberately, but to analyse small failures and near misses in more detail, before waiting for a giant cock-up to force you into action. “The most significant implication of this study…is that organisational leaders should neither ignore failures nor stigmatise those involved with them. Leaders should treat failures as invaluable learning opportunities, encouraging the open sharing of information about them.”
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