Wednesday, August 31, 2011

Are zero tolerance of failure, and innovation mutually exclusive?

Today it dawned on me that the reason for much of the Dilbertian doublespeak we hear today from both corporations and government boils down to saving face for our leaders in a climate with zero tolerance for failure. While we know that we learn most from our mistakes, in business today it appears to be unacceptable to admit to making them.

Portfolio theory teaches us that the biggest returns come from taking the biggest risks, so if we have zero tolerance for risk we are going to be missing out on opportunities to earn disproportionately high returns, or to discover breakthrough innovations.

How can we create safe harbors where failure is acceptable? As inventor Thomas Edison said "I have not failed. I've just found 10,000 ways that won't work." Perhaps we can encourage our leaders and innovators to share with us the mistakes they have made in the past, and more importantly, what they learned from those mistakes? Perhaps we can make spaces in which our teams can throw out the rule book and challenge themselves to accomplish what's never been done before without fear of punitive or career-limiting consequences?