In Celebration of the “F” Word

Giving permission to fail can increase a company’s bottom line.

Posted Feb 09, 2017

By Catherine Tinsley, Jason Schloetzer and Matthew A. Cronin

Source: PublicDomainPictures/Pixabay

Failure is not a dirty word. Despite our general aversion towards failure, it is a natural part of our life experiences. Yet most people find it difficult to simply acknowledge failure and would almost certainly balk at the idea of respecting failure.

The problem is that when we ignore or avoid failures, we turn our backs on learning opportunities. And even worse, when we punish failure, we dis-incentivize exploring new ideas or experimenting with new approaches that might lead to significant improvements. Whether for individuals or for companies, our fear of failure can obliterate creativity, extinguish innovation, and damage success.

People do not like to fail. When people fail, there are natural feelings of shame, disappointment, and frustration that can make people withdraw. To get people “back on the horse,” organizations need to reframe these reactions, not amplify them with punishment. Our research shows that if these individuals are embedded in a culture that can reframe how people process failure, it makes those people more confident, productive, and successful.

Over the course of four months we ran a field experiment in a large company whose sales force operates in several countries. We followed sales people in the United States, Brazil, and South Africa. One group from each country was randomly selected to watch a company-based video about embracing and learning from failure. This video said, for example:

Every one of us who has succeeded has also felt the sting of failure. The only people who never fail are the ones who are not trying hard enough….Setbacks, bumps and “failures” are a normal part of everyone’s journey—both in business and in life. In fact, these obstacles are future successes in disguise. Failures are the launching pad which inspires us to think creatively and positively. Remember the most important thing is to power through any failures. 

Strikingly, we found that when people had been exposed to this organizational message to reposition failure their confidence increased, which had a direct impact on their business success. These sales people had, on average, 22% higher sales and 27% higher sales productivity than those members who did not receive this message. 

We also verified that this was a general effect. We surveyed workers from multiple companies in the United States, Brazil, and South Africa, and we found that being embedded in an organizational culture that acknowledges and embraces failure can improve employee confidence and creativity regardless of industry, job type, gender, and country. More confident workers are 17% more likely to report being innovative, 16% more likely to come up with better ways of getting work done, 24% more likely to be able to overcome challenges at work, and 10% more likely to solve problems independently. 

Notably, the effect was most robust when it was part of the organizational culture rather than just a message from a direct manager or supervisor. When failure experiences are tolerated throughout the culture and understood to be part of growth in an organization, people’s entire orientation can shift. For instance, they approach opportunities rather than avoid engagement out of fear of failure and retribution. They risk experimentation, enabling both companies and workers to fulfill their potential. It makes those workers more confident, which translates into more bottom line success. 

There is a well-known irony in business: You have to spend money to make money. Companies that pinch their pennies too tight go out of business. Maybe it is time we realize that you need to fail to succeed. Ignore the paradox at your peril.

Catherine Tinsley, the Raffini Family Professor of Management at Georgetown University’s McDonough School of Business and academic director of the Georgetown University Women’s Leadership Institute; Jason Schloetzer, the William and Karen Sonneborn Term Associate Professor of Business Administration at Georgetown University McDonough School of Business; and Matthew A. Cronin, an associate professor of management at George Mason University School of Business, are co-authors of “Cultivating the Confidence Cycle,” recently presented at the 2017 World Economic Forum in Davos, Switzerland.