When I was at a restaurant, a few days ago, I overhead a young girl tell her father a joke. She asked “why does the chicken cross the road?” “Why?” He asks lovingly. “Because the chicken wanted to show he had guts!” Dad, of course, cringed. 

Children remind us to understand our position. In this case, as I considered commentary on failures in corporations, I realized that we speak of our appreciation of failure as a learning but we want to avoid failing at all costs. Babies are celebrated when they fail in attempts to walk; we are constantly even celebrating their first experiences with failure yet we transform, in several cases, to crazy parent coaches demanding gymnastic precision in them as they grow. Here is the paradox we create. We wonder why we all end-up fearful of failing as we equate for them that failure = being a failure. 

Corporations embody the cultures of our community and accentuate them to toxic levels unless we intervene with a new culture of respecting failures as the instrument to success. With the introduction of new language like “failing forward”, “try and retry” “agile” we are growing accustomed to speak of failure in this context. Unfortunately, we still hold on to the older rigid cultures within larger companies flush with over-organized, over-discussed budgets and quick career assassinations. 

So when is failure acceptable? What are the limits? What does it mean to be a risk-taker and when is failure the final stroke that ends the narrative of ones career? 

Blockbuster missed market opportunities while Netflix entered and created the new market. Was this because they did not experiment enough or fail forward? Did they not realize what seems obvious today? Of course, the tolerance for sticking to the status quo and to not experimenting on the future while huge transformations of digital downloads, consumer use of personal technology and the disgust for late fees were the loud strategic signals they did not notice. Yet Netflix did not begin in success but they began in experimenting with the new recipe and changed entertainment through experimentation and persistence. I’m sure Blockbuster executives thought that their success should not be tampered with. 

Here are a few of the lessons to consider: 

Lesson #1 – the best way to know when you are about to strategically fail is when you hoard success today. 

Lesson #2 – failure is the general outcome of strategic or tactical experimentation as we push the limits of our designs and desires powered by new market identification. 

Lesson #3 – the mathematics of failure does not equate to the equation of success. Just adopting a philosophy of “failure is good” does not guarantee success. Avoiding and learning from failures does predict success either. 

Lesson #4 – Success today can be achieved by executing well on today’s business model (Blockbuster was doing just that) but to win tomorrow, we must design and deliver to the future as well (like Netflix). Experimenting and failing on the present while experimenting and failing not he future requires us to be tactical and strategic experimenters. 

As an innovator (that’s what they call me), I’ve understood that when I try to cross that operationally focused street dodging traffic while getting to the other side, I must concentrate on creating another pathway for those after me. Innovation is a “gutsy” endeavor in large organizations and many must realize that both operational traffic and strategic innovation must live on the same street and sometimes crashes occur. 

When is failing not an option? 

Failure must be small, fast and deterministic and designed as attempts to clarify the future needs of customers. I had a team that kept experimenting and learning but they learned the obvious, what was already learned by others years prior. But to them, they were progressing at rapid pace of experimentation yet they were merely documenting their results demise. If you experiment and fail while destroying lives, destroying jobs and hurt others, you have need to be extremely introspective of your romance with failure and experimentation. If you run and fall, then get up and run again but never stop to reassess your own identity and contribution to success, then you will repeat failure. If you run without your ethical compass (Theranos!), you insult the soul of innovation. 

When is failure an option?

You create the future beyond the dreams of others. When you redesign the psyche of the marketplace and innovate to the outer limits, you can enjoy failing then because you are attempting to test your spirit. The more you fail, the more confident you become of the probability to win. When you break-up your premise dividing it into trials and market test to uncover the truth in your design. When you succeed in the present and experiment and fail and recover on the future. If you decide that the future is transforming structurally and you embrace that you must discover through experiments and failure is necessary because you walk the path others have feared. 

What is advice to students of innovation about failure? 

Playing it safe is unsafe and Boards of Directors have realized that we all must innovate and must balance risk management with opportunity attainment. There is no paradox with failure if we know that both failure and success are two sides of the same currency for innovation. Failure is not the excuse we use to spend enormous funds on ignorant ideas based on unfacts. Beware of using language using false mathematics to excuse pure failures from those based on bad decisions and leadership. Knowing when to stop failing and get out is as important as failing forward. Exit the opportunity and redefine your objective. Children try to stand for two reasons. They are built to stand. Second is that they see parents standing. Leaders follow other leaders who set the tone and pace of innovation and experimentation and if you ask others to respect experimentation through failure, then show them that you can take it as well. The role model plays the role and sets the positive direction while using their shadow to shade others who experiment, risk and hopefully succeed. 

Final thoughts to begin to fail correctly 

Culture is the basis for failing positively and succeeding while paranoid. One should never forget failure and learning but always forgive experimentation. One should also bring meaning back to overused terms. The way to do that is to actually practice what we all preach. It’s challenging in corporate society to admit or be spoken of in the context of failing. We forget that the courage to try is sometimes lost as the source of any failure. Yet, now, if we don’t try, we are destined to fail. Forces keep us in the mental cages while we hide in the false safety of status quo. We hope to sometime outlast change. We can overcome this paradox by using data with disciplined instincts and trust your gut enough to spill it on the road to the dream we choose.


  • Author, Strategic Business Transformation (Wiley & Sons) and two other books on performance management. Chief Innovation Officer of large healthcare solutions company and former President of three startups, one sold to McAfee and the other to SAS. Former Adjunct Prof of Management at JL Kellogg School of Management. Lecturer at University of Oregon on personal and business transformation and Innovation.  Lost at America’s Got Talent.  Music compositions in album “Watching Waves”.