Seven years ago my team had just shut down the first of our two concept stores that we were running for consumer electronics retailer Best Buy. My team had spent the last two years operating these concept stores in an attempt to understand more about the opportunities in “small box” retail. During that time we had learned a ton and as a leadership team we were adamant that we needed to share what we had learned with the rest of the company.
Most leaders want their organizations to be innovative but just saying it isn’t enough. If they want their people to take risks and innovate they have to create a culture that can support and endure the ups and the downs of driving innovation. Driving sustained innovation requires the right people, processes, & tools.
When working with organizations I frequently talk about the need to build a “Propensity for Action” in order to support driving growth and innovation. With many for profit, and nonprofit, organizations it is far too easy to cower behind the “Tyranny of No” rather than building a culture of action around the tools of hypothesis, test, and verify. A frequently response from leaders is that new ideas are too costly or too risky to take on but if the alternative is waiting for the perfect answer it can be equally damaging to an organization. The challenge is that the odds are stacked against new ideas and most of them will not work out at planned – they will fail. The irony is that unless you are willing to take action and risk possible failure you will remain stuck with the status quo.
I often talk with business leaders about the need to build in a tolerance for risk taking and potential failure if they want to drive growth and innovate. Frequently I get asked if there are specific areas where we should not tolerate failure? My standard response is that Accounting would be one of those areas where organizations should be very cautious with “innovation” and the potential for failure. This story from today’s headlines in another such area.
Innovation projects fail for many reasons but often times the reasons point back to a disconnect with the customer or within the company. Sometimes the customers weren’t sufficiently ready to buy or use the new product or service. Maybe they didn’t yet understand the benefits, they weren’t comfortable enough with the novelty, or maybe they lacked the infrastructure to take full advantage of the new product or service? There are an equal number of examples where companies were unable to operationalize the new product or service and had to abandon it. But sometimes new innovations fail because a company can’t get out of its own way. The story of Best Buy and their development of the innovative gift registry platform GIFTAG is just one of those stories.
SimonDelivers had launched as a online grocery delivery business in 1999 at the height of the Dot.com boom. By 2001 many of their competitors had imploded in the Dot.com bust. Miraculously SimonDelivers had managed to be one of the few that weathered the storm only to be later caught up in the real estate bust of 2008. Often times we can learn more from failures of others than from their successes. This story is a glimpse into the lessons learned from the failure of SimonDelivers.
Failure knows no distinction to whether our institution is in business, government, education, or the nonprofit sector. Facing Failure is a new monthly series that I have launched today with the civic-minded publication Pollen. The goal for this column is to bring the topic of failure to the forefront of our civic conversations in an attempt to remove the negative stigma. I intend to do this by sharing stories and the lessons learned from business, nonprofit, education, and government sector failures. The best hope for this column would be that we are able to learn from each other and strengthen our Pollen community. If you have a story that you would like to share please reach out and connect via my contact information below.
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