Why winners love misfires

I still have to brace myself before I step into learning from things that I did wrong. But as Group Chief Operating Officer at Standard Chartered, I believe it’s a key skill for businesses to learn, if they really want to succeed.

There are two kinds of people in the world. Those that are excited, curious or reflective around learning from failure, and those that run, hide or fight the inevitable reckoning that comes.

That’s one reason why I’m launching this series of my left-field thoughts called Failure is Fantastic. The other involves a confession: in some of the organisations I have been a part of, failure wasn’t an option, meaning that teams weren’t incentivised to experiment. Luckily at Standard Chartered, we are coming to understand the merits of misfires as an opportunity to grow.

In a perfect world, everyone in my organisation would scribble this idea on their to-do list: dare to fail more.

So what can we learn from mistakes? And how do you overcome a fear of failure?

1. Make failure your friend

Doing so starts with putting into perspective what a flop or fiasco does for you. Failure is not the end goal, it’s the mid-point. So don’t pat yourself on the back for failing – instead get excited about the process and what you learn from it. Use mistakes to power you in a new direction that does work. The quicker you trip up, the quicker you find your stride.

But it’s not that easy, of course. Because there is a big fat problem. Fail; fail fast; fail better – these business buzzwords are in the ether and have been for years. But while many brands proudly sport the posters with these pithy catchphrases, they haven’t actually internalised it. Failure is still radioactive to most of us.

So how do you start to practise what you preach? Two key elements, which together form the bedrock of organisational culture, come into play…

2. Context and design

Recently at Standard Chartered, we engineered a context where we know things won’t always work out exactly as they should. That framework is crucial and is created by leaders. We also have a bold vision of where we want to go. That’s the context – the map that lays out where you want to go.

Then there’s the design, which follows the context. Executed by managers who have been empowered from the top, the design is what gets you to the goal. The designs are the many day to day elements that bring failure front and centre and allow you to hit pause so you can learn from it. Things like running regular ‘retrospective’ sessions. Sessions where you look backwards, not forwards. You give people permission to dissect what has been happening, linger over what went wrong. All so that you can pick it apart and improve performance. That deliberate and frequent stock take needs to be non-negotiable in the schedule. Someone needs to insist, “We are going to spend an hour working out how we can improve a little bit in the next week.” This discipline means that you do it as a habit and don’t have to wait for something to go wrong. If you’ve got an hour timetabled, then you ensure you make it a worthwhile session.

It might seem like a slog, but it’s worth it. Because once you get good at these regular retrospectives, it is the very engine that drives constant improvement. Last year, we launched a weekly ‘Improvement Hour’: it creates a nice safe environment where you can regularly create learning moments, rather than reacting to failures when they happen. It’s this ability to openly share and implement improvements that creates velocity, quickly turning “oh no” moments into “aha” moments. In turn, velocity is what makes us relevant to the customer as we react to their needs. On a personal note, this is where I’ve learned from my own failures.

Previously, I was gung-ho about cranking up massive initiatives. But massive projects can be clunky, leading to massive headaches. It has taken me time, but it came from my constant reflection that this is hard, that we seem to be repeating things and that there must be a better way. I now believe it’s vital to break things down into smaller tasks, or run pilot campaigns prior to big ticket initiatives.

Tip: Regular retrospectives are invaluable one-to-one as well. Try moving away from the tired old idea of a once-yearly performance review. Too often, long-standing niggles bubble up here when they could be discussed, and solved, much earlier. If you want to avoid “surprise failures”, commit to constant feedback and connectivity within teams.

3. Frenzied chaos can be valuable

External events change the context quickly and allow good leaders to make profound changes. This is useful, because as leaders we don’t always recognise that we need to change the context or have not yet been successful at it. With COVID-19, our context changed overnight. Almost instantly, everyone in the world had to learn how to work from home. What was clear though was that a large portion of our business was not designed for that environment. I would propose that doing this in a centralised way would have been too slow and not sensitive to local conditions. Standard Chartered needed to empower employees to make their own choices. And people in our organisation were genuinely surprised at the performance of their workforce, and the performance of people who a week before we may have overlooked. But they did exceptional work.

And the question I always ask is, “Well what happened here?” We didn’t re-chip the person or retrain them. Their inherent capability always existed, we just didn’t realise it. Our company design had moved them away from their optimum performance. So the pandemic has shown us that organisations on their best days are capable of great things. But if we don’t embrace what we learned this year, we will revert to the way we were before: not trusting our people to quickly fail, and quickly adapt.

4. Put on your lab coat

Most organisations do not really know what an experiment is. A true experiment is when you have a baseline set of data that tells you about current performance. Then you need to say, “Right; I have a hypothesis: if I do X, we will see a change in the baseline.” And you define what constitutes a successful experiment upfront.

Again, most companies don’t know how to do this. Experimentation for them is not a well-defined muscle group. You know who does it well? Tech companies. Amazon and Google; they build this thinking into their creation of software. They run thousands of experiments. And then the data tells them if it worked, and they improve from there.

In a way, banks have become tech companies themselves. We’ve had to, if we want our services to remain relevant. But we could do more to adopt fresh ways of working.

To that end, there is enormous power in changing your lens, in the mental act of taking off your ‘business hat’ and slipping into a ‘lab coat’ mentality. As soon as you allow yourself to think like an engineer with many prototypes to learn from, or a scientist running an experiment, you see failure as part of the process. It’s an opportunity to ask, “What will I learn if we fail at this particular moment?”

5. Turn failure into a dialogue

Successful companies do this well, and they fail when they stop doing it: they get feedback. The energy with which they do it, and the fact that they acknowledge failure as the fuel that drives them is transformative. Standard Chartered does not empower that element of “help us learn from our failure by sharing your thoughts with us” nearly as strongly.

That’s why I love how tech companies launch a prototype. They will create a narrative that says, “By the way, we’re only launching this app for select users – and you’ve been chosen as one of those lucky people.” Suddenly, they’ve crafted this dance where you have your audience begging to be part of a rough-and-ready product launch. As a consumer, you’re not upset by the bugginess of the app. You’re feeling this glow that you were one of the chosen ones. There’s even a name for this invite-only strategy: the ‘velvet rope’ effect.

The lesson: make a virtue of your bugs, and make people a part of fixing them.

So, failure: I’d love to hear your thoughts. What’s the ‘best’ botch, blunder or breakdown you’ve ever learned from? Let me know in the comments.