Monday Mornings with Madison

When Failure Is and Is Not Okay

Failure due to Innovation vs. Incompetence

Everyone gets it wrong at least once in a while.  That is why they put erasers on pencils.  There are judgment calls that don’t pan out.   There are ideas that seem good in theory but falter during execution.  There are new processes and programs that ultimately don’t work.  For scientists and inventors, getting it “wrong” is an inevitable part of the job.  It’s called trial and error, and that is how discoveries are made and innovations achieved.  With a higher number of trials, you get more successes but also more failures.  But then there are also times when something doesn’t work because of a plain mistake made.  Two plus two does not equal five.   It happens.  To err, after all, is human.

In business, though, getting it wrong can be costly.  Businesses can scarcely afford to get it wrong over and over.  And yet, getting it wrong is considered part and parcel of the process of finding the next “big breakthrough.”  Business innovation is not just desirable but absolutely essential to survival in today’s disruption-driven world.  Creativity and ingenuity are gold.  For imagination to thrive, workers must have a space where – while not encouraged — it is okay to fail.  Employees must be allowed to test theories and ideas and be able to safely be wrong and try again.  That’s what Research and Development is all about.  Indeed, according to Gary P. Pisano, the Harry E. Figgie Jr. Professor of Business Administration and the Senior Associate Dean of Faculty Development at Harvard Business School, “research supports the idea that certain behaviors translate into better innovative performance.”[1] Pisano indicates that those behaviors include “tolerance for failure, willingness to experiment, psychological safety, highly collaborative, and nonhierarchical structure.”[2]

So it is no surprise that all of the greatest businesses and business people have gotten it wrong on occasion and suffered failures.  And some have failed more often and more notably than others.  Take, for instance, Ford Motor Company.  In its 115 year history, the company has had a wealth of successes as well as its share of failures.  To help drive innovation, Ford created a sophisticated scientific laboratory in 1951 to do unfettered basic research in Dearborn, Michigan.  And, just a few short years later in 1958, Ford suffered the embarrassment of the Edsel.  Ford had kept the Edsel under wraps as a new kind of futuristic, experimental car.  But the car of the future was blah by anyone’s standards.  Ford launched the Edsel and, from day 1, the car flailed and flopped.  By 1959, just one year later, Ford mercy-killed the Edsel.  And yet, in that year, it lost an estimated $250 million.  That is the equivalent of nearly $2 billion in today’s dollars.  Now that’s an epic failure.  Despite the Edsel, Ford’s innovation research lab led to their unlikely involvement in superconductivity research.  And, in 1964, Ford Research Labs made a key breakthrough with the invention of a superconducting quantum interference device.  Ford’s culture of innovation allowed people to get it wrong until they finally got it right.  But how much of the Edsel’s failure was a byproduct of incompetence rather than innovation error?  That’s the part that is hard to gauge.

How are failures that arise from testing new ideas and inventing new products different from failure due to incompetence?  After all, few companies can afford to keep employees who are not highly skilled and capable… who get it wrong because they are just not competent, not because they are innovation drivers.  So how can an employer or manager tell the difference?  For companies that want to promote an atmosphere of innovation and creativity but must also deliver results, figuring out when and how to evaluate, tolerate and even celebrate failure, while rooting out incompetence, is a challenge.  How should leaders, managers and HR departments deal with employee failures due to incompetence versus failures that are a by-product of inspiration and inventiveness?

Zero Tolerance for Incompetence

Actually one type of failure makes the other type intolerable.  If a company wants to allow its people to ‘get it wrong for the sake of innovation’, then it must adopt a complete intolerance for incompetence.  Incompetence is not just ‘getting it wrong’ at times, but an inability to get it right.   Professional competence is the broad professional knowledge, attitude and skills required in order to work in a specialized area or profession.  According to, “If you describe someone as incompetent, you are criticizing them because they lack the skills or abilities to do their job or a task properly.”[3] For example, if two basic skills of a good accountant are to be highly organized and detail oriented, then an accountant who is constantly disorganized, scattered and absent-minded is unlikely to do the job well.  The job might get done but it is replete with errors and doesn’t follow best practices.   Taking chances with new ideas or processes can lead to failures, but those aren’t failures related to abilities.  That’s the key.

Companies that want to allow creative flubs for the sake of innovation must eliminate incompetent people.  How?  There are several strategies to minimize incompetence in staff.

  1. Recruit only the very top talent possible.
  2. Set very high standards for employees.  Put those company standards in writing and print them for staff to keep.
  3. Root out anyone lacking solid hard skills for the job such as project management, foreign language, clear writing / communication skills, data mining, resource management, and logistics.
  4. Let go of people who epitomize sloppy thinking.  For example, while a good organization will forgive an employee mistake, the employee should not consider mistakes as acceptable.  Employees should always strive for perfection.
  5. It’s been said to be slow to hire and quick to fire.  This is very true of employees with bad work habits, such as absenteeism, chronic tardiness, and long lunch hours.  This is also true of employees who waste time on personal social media or use work time to do personal tasks.
  6. Let go of managers with weak management skills.

The truth is that incompetence is never desirable in any company, whether the organization is seeking to innovate or not.  Incompetence simply creates problems, puts a heavier burden on other employees to fix issues and fill skill gaps, and lowers the overall bar on any company’s standards.

Tolerance for Innovation Failure is not the same as Encouraging Failure

It is important to note, though, that failure and innovation do not have a cause/effect relationship.  Failing often does not necessarily lead to innovation and success.  In highly innovative organizations, failure is common because there is a high level of risk and there are frequent transactions.  People operating in innovative companies tend to try more things and are moving at a faster pace.  In turn, that generates more tries at strategies and products, which results in more successes… but in more failures, too.   People see this and might think that failure is a feature of highly innovative organizations.  That belief is then passed along and the message starts to sound like:  “If you want to be innovative, fail often.”  But actually, getting things wrong is not essential to innovation.  In fact, failure is to be tolerated and managed (and to some degree expected), but not encouraged.  The real goal is to accelerate the pace of trials and experimentation in order to determine either a solution or the best solution.  But, it is always better to get it right the first time than to get it wrong multiple times before striking innovation gold.

Ultimately, failure of any kind at work is not the nirvana that some might claim.  Yes, companies focused on innovation must be tolerant of occasional failures that might happen on the path to success.  Failure is never the destination.  And certainly a failure to get the job done on a regular basis is never okay.  Companies need to strike the right balance of providing a safe space where the most creative minds can try new things in the search for the next ‘big thing’ while at the same time making it clear that failure is tolerated but not encouraged or desirable… and work should always be performed to the person’s highest and best ability and consistent with the company’s standards.


Quote of the Week

“Success is not final, failure is not fatal: it is the courage to continue that counts.” Winston Churchill

[1]January, 2019, Pisano, Gary P., The Hard Truth about Innovative Cultures, Harvard Business Review,

[2] Ibid


© 2018, Written by Keren Peters-Atkinson, CMO, Madison Commercial Real Estate Services. All rights reserved.

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