Make
The Top 10 Lessons to Learn From Failure
In order to succeed, you need to know how to fail.
→ When Laurence G. Weinzimmer and Jim McConoughey, authors of a new book, The Wisdom of Failure: How to Learn the Tough Leadership Lessons Without Paying the Price, conducted a seven-year study of 1,000 managers and executives across 21 industries, they came to one inescapable conclusion: Of all the management moves they make, leaders learn most from trial and error. Unfortunately, many don’t pursue trials, particularly in the current economy, because they fear making errors. But avoiding risks and ignoring mistakes means missing out on valuable wisdom that often separates celebrated leaders from catastrophic ones. The following 10 lessons may have resulted from missteps, but they led to firmer footing.
01. AVOID THE SEDUCTION OF YES
The universal “yes” takes three forms: an inability to decline new opportunities, a refusal to admit failure, and attempting to be all things to all people. All three destroy careers and companies by leading to the overcommitting of resources, cash and talent. Take MySpace: In a misguided attempt to get hip, News Corp. purchased the floundering company for $580 million in 2005, and spent years (and millions more) trying to reinvent the website to compete with Facebook. It was a disastrous move: News Corp. sold MySpace in 2011 for $35 million. The firm could have saved itself huge amounts of time and money if it had been able to admit defeat before six years had passed.
02. DON’T THINK OUTSIDE THE BOX
It’s practically the most tiresome cliché in business—“think outside the box”—and it may also be the most misguided. According to the authors’ survey, the number one cause of business derailment is thinking “outside the box”—and ending up in businesses where you don’t belong. Remember when Allstate Insurance started dabbling in hotels? Probably not, and for good reason.
Don’t pursue new ideas just for the sake of pursuing new ideas. Rather, be very aware of the business you’re in and the value propositions you and your company offer. You can still think creatively within your own business environment.
03. EFFECTIVENESS MATTERS MORE THAN EFFICIENCY
Ideally, you want to be both effective and efficient, but many leaders fall into the following traps: being efficient at the expense of being effective, or being efficient at the wrong thing. That’s what killed Pets.com in just 268 days. CEO Julie Wainwright dedicated millions to creating a highly efficient website and warehouse system for fulfilling orders, but failed to determine first if e-tailing pet supplies and accessories online was an effective business idea. (It wasn’t.) Only when you know you’re doing the right thing can you move on to doing things right.
04. DON’T BE THE WORKPLACE BULLY
This advice might seem obvious, but bullying at the office often occurs when money and egos are at stake. Look at David Sokol, who, in March 2011, went from the heir apparent at Berkshire Hathaway to unemployed amidst revelations of some shady stock purchases. After Sokol resigned, reports circulated of Sokol’s brass-knuckled office style, including a monthly ranking of his aides in the order he would fire them and his suggestion that the company fire all employees in poor health or going through a divorce. Take a lesson from Warren Buffett and cut out toxic employees.
05. BUT DON’T BE THE PLEASER BOSS, EITHER
The pleaser boss wants everyone to work in harmony, and as a result, has an excessive fear of conflict. Of course, destructive conflict should be avoided—but leaders must be careful not to swing too far in the opposite direction lest they snuff out creativity and individual initiative. “If it is well managed, conflict can have positive outcomes,” says Brenda McManigle of the Center for Creative Leadership. “Conflict can lead to better decision making, expose key issues, stimulate critical thinking and fuel innovation.”
06. COMPETITION CAN DESTROY YOUR COMPANY
Competition, amongst employees or whole departments, can easily backfire. When Pioneer Hi-Bred International, a developer and provider of seed corn products, discovered biotech methods (creating seeds in a lab as opposed to a field), the company decided to incorporate both techniques. But after collaboration between the two divisions failed miserably, the firm pitted farmers against scientists to see who came out on top. The result? The internal competition tore the company apart, forcing Pioneer to lay off 25 percent of its employees and ultimately be rescued by DuPont. Encourage employees to compete in a way that everyone—including the business—can come out ahead.
07. DON’T BE A POWER HOG
Micromanagement and hoarding responsibility are two common characteristics of ineffective leaders, and in the authors’ survey, nearly 45 percent of managers admitted to both. The effects are significant, on the leader (getting fired), the employees (stunting growth) and the company (losing employees). Mattel’s Jill Barad, for example, went from the first female CEO of the Fortune 500 company in 1997 to out of a job in 2000 in part because of her obsessive and controlling management style. You’ll do better by trusting and respecting your employees to handle delegated tasks.
08. STAY ENGAGED, OR GET OUT
Disengaged leaders are characterized by an insular and aloof attitude. It’s not just that they no longer have their finger on the pulse of the company—they’re not even trying to find the heartbeat. Jared Heyman, for example, launched market research firm Infosurv in 1998 at 20. By 32, he was burned out, so he left the company in manager Carl Fusco’s hands and traveled the world. According to Fusco, employees hardly noticed Heyman’s absence because he had always worked behind a closed door. Be the type of boss who can really impact employees by making sure you are engaged in your own work—and interacting with your staff.
09. CHECK YOUR EGO
There’s a running joke in Silicon Valley: What’s the difference between God and Larry Ellison? God doesn’t think he’s Larry Ellison. According to 70 percent of the execs we talked to, self-absorption is the most damning mistake a leader can make. Why? A self-absorbed leader defines success based on personal achievements. A great leader defines success based on his team’s achievements.
10. BALANCE IS THE KEY INGREDIENT
The ability to maintain balance between the lessons learned from your successes and the lessons learned from your failures gives you the wisdom to prosper as a leader. Knowing what to do must always be balanced with knowing what not to do, and personal experiences should be considered alongside the experiences of those around you. “The ability to recognize and learn from one’s own mistakes is the first step,” Gerry Shaheen, a board member at Ford, says. “But the ability to learn from others’ mistakes is genius.”
Adapted from The Wisdom of Failure: How to Learn the Tough Leadership Lessons Without Paying the Price (Jossey-Bass, $27.95, 304 pages).