Useful failures can prevent epic ones

June 28, 2013

An old friend provides an intriguing twist on a common theme here at NVSE:  the nature of, and sometimes the purpose of, failure.  In the past we’ve written that failure is a part of business and a great teacher, that it’s the secret to national wealth, and that it’s important to fail the right way.  (For examples see here, here, herehere, here, here, and here.)

This past Tuesday, in an interview with Fox Business, Professor Michael Roberto maintains that encouraging “useful” failures in an organization will help its executives avoid catastrophic ones.  By paying closer attention to certain signals in the organization, they can proactively sense problems before they metastasize instead of being forced to solve them after the fact, sometimes in crisis mode:

Roberto points out that “most large scale failures have an incubation period and are not the result of a single root cause, but a chain of errors.” However, as  you climb the corporate ladder, it gets tougher to see small errors incubating beneath you. This is why managers have to rely on communication with their staff  in order to keep small problems from growing into big ones.  Inevitably, this means dealing with the challenge of filtering and finding ways to connect  straight to the source.

In the interview he offers 3 basic techniques to become a problem-finder instead of a problem-solver:  circumvent gatekeepers, be an anthropologist, and encourage useful failures:

When it comes to failure, Roberto advises not to wait for a failure to create a learning opportunity, but instead create opportunities to fail. In other words, create experiments and pilots to test ideas in an environment that is safe. This encourages employees to acknowledge and address failure in a positive  way they can learn from, and will lead to a more open culture where employees will be more willing to share little errors before they erupt into major problems.  Bottom line, creating a genuinely strong connection to your business requires  a willingness to go beyond just being a great problem solver by also becoming a great problem finder.

Professor Roberto is the author of two books on leadership, decision-making, and competitive strategy in our Library and has previously listed seven potential causes of epic failures (e.g., the Deepwater Horizon cataclysm).

 

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