When making a new hire we usually look for people who have succeeded at everything they have done.  Yet no one really does.

R G Success.jpg

The perceptions, though, force us to focus on successes and put the failures out of our heads.  This is a huge mistake.  We can learn much more from our failures than from our successes.  The person who has had one hugely visible success tends to come to believe that they have the magic touch, while the person who has failed but been introspective about it and learned will benefit more from the experience.

It is also important to use failure as a marker of initiative.  Those who cannot point to any failure are showing that they are not prepared to do anything differently or take any risks at all.  This is why Silicon Valley Venture Capitalists would rather invest in a top management team that has been involved in a number of start-ups, even if they have failed, than a team that has been involved in none.  The VCs do, however, want to make sure that the members of the team understand how they could have done better.

Time and again, we meet people who got lucky and thought that they were smart because they have no incentive to analyze what made them successful.  As a result, like the gambling addict who started with a winning streak and is convinced that they just have to play long enough to get it back, the successful people repeat the behavior that made them successful even if the conditions, market, people, and technology are different.  Because they do not really understand why they were successful, they come to think that they simply “know” what to do.  In a sense, they have moved from perhaps the conscious incompetence (or insecurity) they started with to an unconscious incompetence so that they fail.  I have seen people who succeeded once go on to failure after failure, simply refusing to admit that they need to learn anything new.

While this is particularly important for start-ups, most of us are not VCs having to make decisions every day about investing millions of dollars in start-ups.  Nevertheless, we face decisions regularly that have an even bigger effect on ourselves.  When we hire someone, that is just such a decision.  When we accept a job, we can consider that we are “hiring” a boss.  Or when we are entering into a partnership, we are also becoming dependent on someone.  So, we need to be aware of the potential danger which lies in someone who has never failed:

  • Arrogance and inability to recognize when they do not know something.
  • Contempt for others.
  • Unwillingness to accept advice.
  • Inability to learn.
  • Non-acceptance of when they have failed—blaming others.

The best entrepreneurs, co-workers, bosses, or subordinates have failed, have learned from those failures, and are prepared to plan against failure and react if it seems that it could happen.  These people are objective in their judgment of others and themselves.  It is very clear when a start-up has failed, less so when an internal corporate initiative has done so. However, it is important to identify those and check to see that someone who participated has gained valuable experience rather than being in denial.

It also humanizes people when they can admit to failures.  Others can identify with someone who admits to vulnerabilities than someone who seems perfect, or at least acts that way.  So, admitting to failures and identifying what has been learned becomes strength.