5 Steps for a Better Innovation Culture through Experimentation & Failure

Build a Stronger Innovation Culture by Embracing FailureI have recently written a white paper on how to build a stronger innovation culture by embracing failure. Unfortunately, I cannot offer a clear solution, toolbox or blueprint on how companies can do this and one major reason for this is that most — if not all — companies are very reluctant to share their failures and how they approach them and learn from them.

But we still need to look into this and as a starter, I can share these 5 suggested actions taken from the whitepaper on what companies that wants to tackle these issues can do:

1. Take responsibility.

All of what I’ve said so far points to the need to start changing behavior within companies when it comes to dealing with failure. For such change to occur, someone needs to take ownership of the process. And each person involved in innovation needs to recognize that smartfailing is something they need to do better, and determine how they can take a more active role in making that happen.

2. Understand what goes wrong.

You need to know why failures really happen. The answer will be different in each organization, but every company needs to gain a better overview of where the problems lie that keep them from learning from failure. The key thing to keep in mind is this is not about avoiding failure; it’s about how can we learn from failure and apply that into future processes. The challenge is to create a common understanding in which failure is seen as a learning opportunity that holds the potential to make the organization smarter and better.

3. Be transparent and communicate better.

It seems as if every organization I encounter can benefit from greater transparency and better communication on their innovation issues and the same goes with failure. The people – and especially the executives – taking the responsibility for developing a smartfailing process must put in a significant effort on how you communicate on this sensitive topic internally as well as externally. It can be damaging to communicate too much, or to share insights on things that do not really help in the long run. You need to find the proper tone and balance for this.

I often talk about perception as being important for building a stronger innovation culture and the same goes with failure. If executives and managers show and tell the employees that failure is not tolerated, then this will become a perception that will turn into reality. This also goes the other way. If your company has examples in which you actually have a high tolerance for failure and ways in which you also learn from this, then the company can build further on these pockets and build a more positive perception towards smartfailing.

4. Reward behaviors, not just outcomes.

Too often, organizations are too focused on rewarding the outcomes of their employees. It is just very difficult to reward the team of people in charge of a failed project or initiative, but then what do you do when the learnings the team captured and shared leads to great success in the future? Should these people not be rewarded and recognized in some way? If you really want to change a corporate culture, you must find ways to reward the behavioral changes that lead to the desired outcomes. If not, you might not get there at all.

5. Educate up and down.

It must be a key objective for a corporate innovation team to educate the organization on innovation and this goes for employees, managers and also the executives. The latter is more difficult, but it can be done — and it is really needed — as the executives in many ways are the reason for the mess that you are in. The corporate innovation team could take the lead on how to educate on smartfaililng together with other relevant functions such as HR and also representatives from the business units.

Conclusion

The steps I’ve outlined above all present challenges; it is no easy task to develop a more adaptive corporate culture that is open to smartfailing. However, I don’t think you have any other choice but to make the effort because innovation is key to prosperity — let alone survival — in a business environment driven by a faster and faster pace of change. You either get this or you fall behind. It will be interesting to see how this plays out in the coming years.

As a final remark before you embark on this journey, I encourage you to open up and get in touch with the many other people who want to see their companies becoming better at learning from failure. You are defi- nitely not alone and the more we can talk about this and share insights and learnings, the faster we can all learn from our failures. Hopefully, this white paper can help us get started.

image credit: mixed hands image from bigstock

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3 Responses to 5 Steps for a Better Innovation Culture through Experimentation & Failure

  1. Very interesting and important Post!. In relation to point 3 communication and point 4 behaviours I will add two important aspects from HR; (1) the Psychological Contract, defined more or less as the perceptions of both parties (the employer and the employee) of the reciprocal promises and obligations implied in that relationship beyond the explicit traditional contract. For example one of the findings from a survey of more than 1000 senior UK HR managers was that the exchange is not always fair. The point is that firms should use the psychological contract to clarify understanding between the employer and the employee to increase fairness, trust, commitment, performance etc. (2) Employee Engagement which is a complex multi-dimensional construct that might have organizational benefits for innovation as it can influence innovative work behaviours, personal initiative and proactive behaviours.

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