A Blog by Jonathan Low


May 15, 2019

Why Leaders Need To Learn From Success As Well As Failure

Fail fast and learn!

There has been great emphasis on learning from failure recently, especially as the digital economy has grown to dominate almost aspects of business: embrace it, contemplate it, analyze it, manage it.

But learning the right lessons from success can be just as important because the useful knowledge is not in the success or failure per se, but in how the approach to the problem or opportunity was identified, analyzed and executed. JL

Francesca Gino reports in the Wall Street Journal:

What did we set out to do? What actually happened? Why did it happen? What are we going to do next time? Companies tell their employees to embrace failures, to ask what went wrong and to take advantage of all the learning opportunities failure affords. But when it comes to success, companies rarely learn from their experience, and what they may want to change. We're prone to contorting evidence to reach the conclusion we favor. When things went well, people’s impressions will be positive. It’s crucial  to collect data on all aspects of the work we’re reflecting on, and then use that to stimulate discussion and challenge assumptions.
For many of us—no matter where we work or what we do—nothing feels as good as success. And for many of us, nothing is more harmful to our growth and development
To understand why this is, compare success to failure. Companies tell their employees over and over again to embrace your failures, to ask yourselves what went wrong and to take advantage of all the learning opportunities that failure affords.
But when it comes to success, companies rarely feel the urge to stop and see what they can learn from their experience, and what they may want to change. Rather, the instinct is to assume that if they succeeded, all is good with the world. What did we do right? Everything. What did we do wrong? Nothing.
What a missed opportunity that is. In fact, it almost guarantees that success will eventually breed not more success, but failure.
With that in mind, here are guidelines I’ve culled from my research for the best ways to put successes under a microscope—and make future successes a lot more likely.
1. Where did the success come from?
When looking at success, the first step is understanding why you succeeded. Was it luck? Hard work? Innate talent?
Seems obvious. But human beings have a bias to focus just on the outcomes, and ignore the fact that multiple factors in the decision-making process contributed to those outcomes, from luck to a particularly favorable market to team unity. When we only focus on outcomes, we miss important information about what went right (and wrong) and why.
A biotechnology company I studied once faced a serious capacity shortage when trying to roll out an important new product. Just when it appeared the firm wouldn’t be able to meet demand, its leaders discovered that a competitor had put a plant up for sale—a stroke of luck that allowed the company to buy all the capacity it needed. The product launched and was extremely successful.
Most companies would have rejoiced in their good fortune and moved on. In fact, in one project I studied, a group responsible for developing motorcycles used for racing found itself experiencing unexpected success the first time it joined a new type of competition. The team had collected a lot of data they planned to use to improve the motorcycle’s design, but due to the success, they didn’t even look at it. The next season, the team struggled.
The leaders of the biotechnology company, instead, reviewed the project and identified the crucial role luck had played in its success. They learned that faulty demand forecasting and capacity-planning processes had left them vulnerable to failure. Armed with this knowledge, they made improvements so that they wouldn’t need to rely on luck the next time around.
2. Make the postmortem process mandatory
Analyzing successes shouldn’t be an issue that leaders get to decide to do or not do. It should be mandatory. The military holds “after-action reviews” of each combat encounter and combat-training exercise, irrespective of the outcome. When conducted properly, these reviews generate recommendations that can be put to use immediately.
Companies can employ the same process. Like a sports team that meets right after a game to review performance, postmortem participants can gather after an important event or project to discuss four key questions: What did we set out to do? What actually happened? Why did it happen? What are we going to do next time?
3. Acknowledge that your brilliance may not be the reason for your success
We all like to think that we are the reason for our successes. (We don’t always feel that way about our failures, of course.) So when running postmortems, such attribution bias, or the tendency to make attributions about the cause of our behavior and that of others in a way that doesn’t match reality, can lead us to conclude that our success is due to our brilliance and skill, not luck. That makes learning from success a challenge, as success makes us incurious and overly confident in our abilities.
In a study that Brad Staats of the University of North Carolina in Chapel Hill and I conducted with Chris Myers of Johns Hopkins, we asked participants to work on two different decision-making tasks spaced one week apart. Each task had a correct solution, but generally only a few people were able to identify it. We found that participants who believed they failed on the first activity were almost three times as likely to succeed on the second activity. They learned from their failure and made better decisions as a result. We would all benefit from bringing the same learning mind-set to our successes.
4. Change up the format
It’s tough to apply the same degree of rigor to project after project. To keep postmortems from becoming routine and predictable, we need to approach them more thoughtfully.
One animation studio I’ve studied does this by using different formats for their looks back. One time, for instance, the leaders might ask participants to name the top five things they would do again and the top five things they would not do again. Another time, they might ask some people in the group to think about what went well and others to focus on what did not.
5. Collect data and apply it with discipline
To run an effective postmortem, we can’t just rely on people’s impressions of how things went. After all, especially when things went well, people’s impressions will be generally positive. We see what we want to see. It’s crucial, therefore, to collect data on all aspects of the work we’re reflecting on, and then use that data to stimulate discussion and challenge assumptions.
For example, more companies are benchmarking incentive compensation to the stock market or a composite of competitors’ share prices to ensure that an executive is creating real value rather than just benefiting (or suffering) from a rising (or falling) market tide.
Learning from both success and failure requires us to be willing to accept what the data tells us. Decades of psychology and decision-making research show that we’re prone to contorting evidence to reach precisely the conclusion we favor. Stating upfront how we’ll use the data we collect can help us avoid this trap.
6. Elicit outside perspectives
The idea of getting outside advice on what you did right might seem odd. Why do you need an outsider who knows less than you do to tell you why you were successful? You know why you succeeded: because you did it right.
But experience and expertise can lead us to rationalize our past choices. In 2006, the U.S. Food and Drug Administration issued a warning about the dangers of using a common technology, drug-eluting stents, in “off-label” cases. The warning was triggered by compelling evidence of serious complications from the stents for patients, even death. My colleagues and I found that the more experience cardiologists had on the job, the more likely they were to continue to use drug-eluting stents despite these worrisome dangers.
We can reduce this decision-making bias by inviting people who are likely to have a different perspective from the prevailing view into the discussion. They’re the ones who may be able to shed true insight into why you succeeded.
The animation studio I mentioned periodically conducts a review of several productions at once, and tries to get someone with an outsider’s perspective, such as a newly hired senior manager, to head it. Often, they can explain successes in ways that the firsthand participants might have missed.
The key ingredient here—as with all these steps—is to not be trapped by our instincts. Our gut reaction when we succeed is to be pleased, credit ourselves and move on to what we assume will be our next success. If we can move beyond our gut reaction, and understand we need to learn from our successes as much as we can learn from our failures, then we will truly earn the credit we think we deserve.


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