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Produce Breakthrough Ideas by Encouraging Employees to Fail

By Alan Gehringer

    Mon, May 11, 2015 @ 09:00 AM Strategies for Growth, Accountable Leaders & Teams

    business-561388_1280Do you encourage your employees to fail? Doing so can produce some breakthrough ideas and products.

    I am reading Exponential Organizations, a book written by Salim Ismail and one that anyone in the technology field should read, although applicable to all businesses. One concept that rings loud and clear in the first 100 pages is fail fast, fail often, while eliminating waste. 

    As we get older we become more risk averse and have so much information in our craniums, it can stop us from taking chances. It is a natural tendency that we need to work hard to overcome as individuals and as organizations. The most successful organizations today encourage failure. Not blind ignorant failure, but failure that produces learning and provides fresh insights into new possibilities. Patrick Thean often says, “there is no wisdom in the second kick of the mule, but I am always happy to pay tuition for people to learn from their failures.

    Things are changing so fast today and small companies are disrupting large companies with new ideas and the ability to be very agile. Larger, more established companies need to think like small companies and continue to reinvent themselves and eat their own children, products and services, rather than thinking in a linear fashion. Typical product development processes like Stage Gate may no longer be effective and take too long to introduce new offerings.

    So, ask yourself these questions:

    1. How many failures did we have last year?
    2. How many new ideas did we move forward?
    3. Do we reward failure?
    4. Do we promote innovation?
    5. What percentage of our sales came from new products or services last year?
    6. Are our margins growing or declining? 

    If you are not happy with your answers, think about making some changes.  Taking risks and creating a culture to do so can yield breakthrough results. New offerings allow you to compete on value, not price, that increases your margins and bottom line.

    Jim Collins encourages companies to fire bullets before firing cannons. These are the efforts to try out new ideas and test assumptions. Take the opportunity to learn from the failures and improve your ideas. Make adjustments, learn, repeat, and scale when you have perfected the concept.

    You may consider putting a KPI in your dashboard to track failures. This would be a leading indicator to new ideas launched.

    Many companies are using LEAN techniques such as kaizen to drive their innovation and improvement efforts. Apple did this when they launched their first Apple Store. They prototyped two stores, tested, redesigned, tested and repeated until they got it right. After they perfected the concept, they scaled quickly and now have at least 425 stores in sixteen countries. These are the most successful retail stores on the planet from profitability per square foot standpoint. In addition, it was the willingness to take risks, fail, and make adjustments to get it right before firing the cannons and expanding the number of stores. Eric Ries and Steve Blank have written a book that expands on this approach titled The Lean Start Up.

    I have always liked the 3M model of encouraging innovation and new ideas and quite a few other well know companies have adopted this philosophy. How is your innovation pipeline today and are you encouraging failure? Please feel free to share your thoughts.

    Good luck and grow profitably, Alan

     

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