Innovation When “Failure is Not an Option”

You hear the phrase… “Fail Fast.” Or even Mark Zuckerberg’s mantra, “Move fast and break things.” We even hear executives in C-suites and boardrooms echoing this message so people feel that innovation is a key factor in the success of their organization.

Yet one point that often goes unsaid is that to innovate, you need to test new ideas. Some of those ideas will be great successes, while others could be dismal failures.

That’s all a part of innovation.

It’s also why you want to establish operational flow so you can quickly go through the cycle of trying something out and learning from the results.

But what do you do if you work in an organization where “failure is not an option”? How can you reconcile the need to innovate with a deep-seated fear of failure?

Why Fear Failure?

To answer those questions, let’s start by looking at why some organizations may avoid failure.

Too Big to Fail

During the global financial crisis of 2008, the phrase “too big to fail” became a popular label for financial institutions that are so deeply intertwined in the financial system that if they were to fail, they would create a disaster in the broader economy.

The global financial crisis resulted in increased regulation to prevent another crisis. Included in those regulations was the labeling of select banks, insurance companies, and financial institutions as Systemically Important Financial Institutions (SIFIs).

The net result is that an organization designated a SIFI incurs additional regulation and is hesitant to take actions that could cause them to fail.

High Cost of Failure

Your organization doesn’t have to be fully intertwined into the financial system to fear failure. Sometimes concerns over the consequences and costs of failure are enough to make the people in an organization fear failure.

Take oil and gas companies who, when they hear “failure,” think of catastrophic failures such as the Deepwater Horizondrilling platform fire and subsequent oil spill.

The cost of such failures, from a human life and monetary perspective, makes people in these organizations reluctant to take actions that are perceived to be too risky.

Failure Is Not an Option

The phrase “Failure is not an Option” is often associated with Gene Kranz, NASA’s Director of Flight Operations during the Apollo 13 mission.

While Kranz never said that phrase during the Apollo 13 mission, he chose it later to reflect the genuine spirit of the people in Mission Control. Here, failure was losing the lives of the three astronauts aboard the Apollo 13 spacecraft, which suffered a significant malfunction on its way to the moon in April 1970.

When organizations take actions where people’s lives are at stake and the chance of injury or death is high, their appetite for failure decreases quite a bit.

Failure is Not the Goal

At first glance, it’s probably easy to see why the organizations mentioned above want to avoid failure.

Yet ironically, those organizations are all in inherently risky environments where it’s highly unlikely they will experience 100% success.

A key contributor to financial institutions’ revenue is based on how they manage risk. A large part of an oil and gas company’s work is exploration. Spaceflight is inherently risky.

The key for these organizations is not to seek failure for failure’s sake. They need to take advantage of small recoverable failures to learn the lessons that help them avoid the existential failures of a company going bankrupt, an oil platform sinking, or losing astronauts during spaceflight.

Learn Quickly Rather Than Fail Fast

You want people in your organization to experiment and learn from the results, whether good or bad. The faster you go through that learning cycle, the more you’re likely to learn.

It’s not helpful to describe this activity as “failing fast.” That puts too much emphasis on failure and all the difficulties that come with it. While people learn from failure, recent studies have shown that learning from failure has its limits.

Failure alone does not lead to learning. It’s most helpful in a structured learning situation where the consequences of failure are relatively small and the opportunity to recover is fairly quick.

To apply this idea in a practical sense, think of your team’s sprints as a learning cycle. Then think of the duration of a sprint as how long you’re willing to be wrong. The longer your sprint, the longer you work with the impact of a wrong decision and potentially the higher the cost.

The shorter the sprint, the quicker you can get through the learning cycle, the lesser the impact of a failed decision, and the sooner you can apply what you learned to correct your course.