What’s stopping you from learning from your business’s failures

Updated on 15 October 2014

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The small business failure rate in South Africa is one the highest in the world with the Trade and Industry Minister, Rob Davies, saying in 2013, that five out of seven new small businesses fail within the first year. Interestingly enough, despite the failure rates, many business leaders and entrepreneurs continue to fear failure instead of embracing it.
There is a lot to be learnt from failure if leaders equip themselves with the necessary skills, says Amy Edmondson. Edomondson is a Harvard Business School professor, and the author of  Teaming: How Organizations Learn, Innovate, and Compete in the Knowledge Economy.
In her interview with the Harvard Business Review, she explains why it’s important for business leaders to not only analyse workplace mistakes, but to work on producing more intelligent ones.
“You want to develop those skills, those practices so that they become second nature”, she says.
Here are the biggest obstacles stopping you from learning from your business’ failures according to Edmondson: 
1. Playing the blame game
Deeply ingrained in our psychology is the instinct to avoid getting into trouble, says Edmondson. This however stops people from learning from their failures.
“For reasons emotional and quite logical connected to promotion and other activities, we don’t want to be blamed for things going wrong”.
2. Refusing to embrace failure as part of the process
Today’s workplace has changed, there are a lot more new industries, careers and ideas. It’s important, Edmondson says, that leaders recognise that with innovation, things will go wrong.
“Most managers understand that failure is important to learn from mistakes, at the same time they are worried that if they are open and accepting of failure, they’ll create a certain ‘anything goes’ atmosphere where there is no high standards and people can pretty much perform at whatever level they want and it’ll be fine”.
3. Failing to create a favourable environment
It’s important for business leaders to create an environment where employees feel safe speaking up when things go wrong, and to know when to speak up,  says Edmondson.
“Leaders’ responsibility is to  frame the work accurately. Tell the story of what kind of work we do, and how failure fits in to that”
4. Shooting the messenger
Whistle blowers and critics are to be praised for their courage coming forward, is Edmondson’s view, not condemned.
“It will never feel like a happy day when someone comes to you and says something is wrong. Resist the urge to get annoyed and frustrated, and take it out on them”.
5. Not spending enough time on failure
It’s important to set up structures and processes to deal with failure. Edmondson’s advice is to set up multi-disciplinary teams and systems to analyse what went wrong and how to move forward.
“The natural inclination is to get over the failure quickly and get back to the real work, but that [analysing failure] is part of the real work”.

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