By Lindsay Macintosh, CHRP

Embracing failure within an organizational culture—by encouraging creativity, taking risks, trying new things, and openness to new ideas—is key to organizational success.

There are many shades of grey regarding failure, but nearly always a silver lining. Failure is not necessarily negative. Moreover, it is a fundamental component of success.

Success is Not Black and White
Some organizations hold that a culture of success is one in which things must always run smoothly, with minimal or no mistakes; as such they adopt a more divisive black and white approach to defining success and failure.

The black and white approach to success and failure hinders employees, as well as organizational development.  Employees become risk adverse, face anxiety and fear, and want to hide their mistakes.  This results in a stagnant culture with low employee engagement and poor morale, as well as high turnover and absenteeism rates.  Often, collaboration among employees, teams, and management suffers also, since nobody wants to associate with someone else’s potential failure.

Of Compliance and Retention
The key to success is to address failures at certain levels, learn from them, and move on to the next thing without demoralizing and punishing employees.

Brenda Rigney, CHRP, vice president of people operations at Earls Restaurants, sees retention as the the ultimate workforce problem that can arise from intolerance of failure that results in employee discipline.

“Who would want to work for a company that makes you feel bad about your decisions and actions, or who watches every move you make?   The environment becomes transactional versus transformational.  Compliance prevails over empowerment,” says Rigney. ”(The key is to address that) before the innovation weakens, and mistakes, theft/fraud, and negative employer branding occur.

Cultures That Embrace Failure Succeed
Organizations that adopt failure into their culture value processes more than, or as much, as the end results of individual employees and teams.  They are more concerned about why the end result occurred.

Risks are essential to running a business in today’s highly competitive global economy.  Organizations with failure built into their culture see that risks do not have to be “all or nothing.”  Within such organizations, the leaders and managers:

• foster a collaborative environment wherein failure offers valuable learning opportunities;
• encourage taking risks on ideas knowing that some will not work out,
• recognize that mistakes can be seen as opportunities for employees to become more aware;
• use these opportunities to discuss how things should or could work differently;
• celebrate wins and losses;
• create avenues for feedback, such as the company intranet and blog posts that ensure a two way communication system between employees and management;
• hold face-to-face meetings with employees and management to discuss information on topics such as innovation, relationships, and learning and growing.

Failing is Learning, Knowing is Growing
Today’s successful organizations see failure as a teaching opportunity.  It could involve mentoring new employees, debriefing sessions, or training in a specific area where the failure occurred.  Most importantly, failure should be explored and seen as an opportunity for everyone to learn and benefit.

A culture that embraces failure promotes ongoing feedback, open communication channels, and most importantly, good listening skills.  This way, employees feel able to approach their supervisors or managers before a minor mistake leads to a major disaster.

Empowering Employees to Innovate
“We value innovation and creativity,” says Rigney. “We encourage every leader and partner, hourly employees, at Earls to operate their role with an ‘It’s Your Business’ philosophy.  We teach people how they can manage their business and encourage them to try new initiatives for drive their business.  We recognize that some ideas will work and some won’t.  But it’s about changing quickly.  We have great stories about a dishwasher creating a new system to organize cutlery that increased productivity of our front house team.”
She adds, “Our “It’s Your Business’ philosophy is applicable to all levels of employees in the company.  We don’t talk about repercussions or consequences.  This is integral to our business.  No one likes to be out at a restaurant when something goes wrong.  Least of all hearing, ‘I’ll have to go check with my manager’.  We empower people to make a call that will keep a guest coming back to the restaurant.  Afterwards, the leader and partner will recap what occurred with the guest and the decision the partner made.  They will review processes and use the ‘mistake’ as a teaching opportunity.”

Factor Failure or Fail
Organizations that take the black and white approach to addressing failure leave no room for experimentation.  They define their employees by whether or not they make mistakes.  Unfortunately, this leads to risk-adverse, non-collaborative behaviours that stymie opportunities for innovation and creativity.

To stay relevant in our competitive economy, where ideas are invaluable, organizations must foster a culture of experimentation in which failure is acceptable—so long as the intentions are relevant and employees learn from failure so the same failures will not be repeated again.  At a core level, organizations need to factor failure proactively by working it directly into their business plan.  Organizations that neglect to see failure as opportunities for growth will ultimately discover find their failures ending poorly.

Lindsay Macintosh, CHRP has over 20 years experience in payroll and benefits in the retail, foodservice and logging industries

(PeopleTalk Spring 2015)