September 27, 2011
Fear is the fox in the hen house on the innovation farm. Fear is the mortal enemy of innovation, because when a culture punishes failure, its people work toward maintaining the status quo, and no headway is made.
Embracing failure is not necessary, but tolerating its risk outside of your core business lines is essential not only for growth, but for survival in the new economy. Unfortunately, most companies have a much better memory for failures and worst practices than successes and best practices. Our long memory for failures, fear, and the human desire to avoid both not only stifles product and process innovation, but also keeps us from leveraging our existing intellectual and intangible assets.
When we work through that fear, we can squeeze value out of our work. Proctor & Gamble provides an example. P&G discovered Olestra while researching fats that could be digested by babies in the 1960s. Olestra found second life as an ingredient that made potato chips and other snacks less fattening in the 1990s, but it failed. Customers, understandably, preferred to satisfy their snack cravings free of the abdominal cramping and even more serious alimentary distresses. Some states, including Great Britain and Canada, even banned Olestra as a food additive. But P&G believed in the product and found many other applications for Olestra that were not immediately apparent—its chemistry has been used for industrial lubricants, deck stains, paint additives, and even environmental remediation.
The lesson from Olestra is clear—when you have faith that a product is strong, and processes that encourage innovation and creativity, failures can be turned around to produce value. So don’t be afraid of failure—it’s inevitable any way. Instead, prepare your company to tolerate the risk of failure and remember the words of Thomas Edison, “Many of life’s failures are men who did not realize how close they were to success when they gave up.”
EDITORS NOTE: This guest post is by Andrew J. Sherman, a strategic growth expert and a partner in the Washington, D.C. office of Jones Day. His new book, Harvesting Intangible Assets, is available on Amazon.
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