When Failure Leads to Success

From the moment we’re born, we are told that time heals all wounds. But nobody tells us it’s only half true. When somebody else inflicts the wounds, fine. But when wounds are self-inflicted - also known as mistakes - all the time in the world won’t heal them if we don’t acknowledge them.

Failure is a little bit different, but the concept is similar. Failing to admit and learn from failure will only lead to more dramatic failure. The converse is also true: admitting and learning from failure will ultimately lead to success.  

Unfortunately, many leaders seem to be allergic to the whole idea of admitting failure. I’ve seen it dozens of times with business leaders, political leaders, CEOs, and executives. Why that is, I don’t know, but it may have something to do with how success gives leaders a big head. Regardless, systemic business failure, corporate failure, and personal failure, typically comes down to leaders or managers sticking their heads in the sand. Don’t be one of them. Instead, master these …

10 Ways Failure Leads to Success

1.             Change management. Ever try changing a company system or process that involves lots of people? If you have, then you’ve failed. And if you didn’t learn from it, then you’re still no good at it.   

2.             Employee. What, you were a great employee out of the gate? (Come on and tell the truth.) You made mistakes; that’s how you learned how things work, how to get things done, when to take a stand, and when to suck it up. Or maybe you didn’t. Hmm.

3.             Turnarounds. Turnarounds start by clearly stating the problem, what went wrong. Sometimes it takes a few iterations, as with IBM, Apple, and HP. Some boards wait too long, as with Nortel. Are Sprint, Sony, and Dell next?

4.             Managing people. I don’t care what business schools say; you don’t learn this in school. You learn it on the job by making mistakes and learning what works and what doesn’t. Period.

5.           The scientific method. It’s built on the concept of making an assumption, experimenting, proving it wrong, and continuing until you can’t prove it wrong. 

6.             Innovation. The whole startup innovation loop is a learning curve based on trial and error. Sure, we love the Google and FaceBook founder’s stories, but far more common are entrepreneurs who failed multiple times before nailing it. 

7.             Consulting. Um, not to get too specific, but the only reason I have any success as a consultant is because I made dozens of mistakes over two decades in corporations. It’s called “learning the ropes.”  

8.             Strategic planning. Any strategic planning process must begin with an analysis of what’s working and what isn’t. The “W” in SWOT stands for weaknesses, and with good reason.

9.             Post mortems. If you don’t do post mortems on lost customers and failed product launches and marketing campaigns, you’re far less likely to get it right the next time.

10.          Relationships. If you need me to explain how failed relationships - personal, business, whatever - make you a better partner and team player, then you have bigger problems than I can help you with.   

It may seem like a contradiction and it certainly is ironic, but thinking you are always right is a sure path to failure, while admitting and learning from failure inevitably leads to success.

How to Advance Suggestions

Whether you own a business or work for someone else, differentiation is tough. Local and global competition, coworkers, others in a similar industry… it’s really easy to get lost in the crowd.

Here’s a simple way out of the “similar” rut: Pick an always. An always isn’t based on style; an always is something you will do, without fail, no matter what.

In time you will be known by your always — and you’ll start to stand out.

If you own a business, you can start small and decide you will always:

·      Respond to calls or emails within 30 minutes

·      Follow up the day after every sale

·      Suggest alternatives

·      Proactively caution customers about potential drawbacks or risks

Or you could go bigger and always:

Deliver early

Charge the lowest prices

Maintain the most comprehensive inventory

The always you choose is up to you; just make sure customers will value and appreciate the difference your always creates. For example, if I decide to always provide a formatted PDF along with every Word manuscript I send to clients, that’s a nice but basically worthless gesture. But if I decide to always provide ideas for subsequent books — not a bad idea, actually — most clients will appreciate the fact I’ve given real thought to build on their current book to create future opportunities.

The same is true if you work for someone else. You could decide to always:

Be at work on time

Respond to emails and calls the same day

Attend meetings (this one would have killed me)

Praise others when they do something well

Say thank you

Or you could go bigger and always:

Be at work early

Stay until important tasks are complete

Respond to emails and calls — even when you’re off

Volunteer for the worst assignments

Again, the always you choose is up to you but must be based on what your organization values. If measurable output is more important than adhering to set work hours, deciding you’ll always get to work early is much less valuable than deciding you will always outperform your peers.

It may take time, but your always will eventually make you stand out. For example, I’ve worried about whether a critical shipment would arrive; it’s powerful when someone says, “Don’t worry, it will be here. They always deliver on time.” I’ve wondered if an important task was completed the night before; it makes a real impact when someone says, “Tom was working on that, so I don’t even need to check. I’m sure it’s finished.” I’ve worried about whether an installation by a vendor would go smoothly; when someone says, “We’ll be fine — they would have let us know ahead of time if there were any potential concerns or pitfalls,” that level of trust, based on an always, really stands out.

If you’re struggling to differentiate your business or yourself, pick an always, whether large or small — based on what your customers or your organization values, not just on what you value or want to do — and deliver, every time.

Soon you’ll stand out just fine.

The Effectiveness of the Peter Principle

Everyone’s heard of the Peter Principle - that employees tend to rise to their level of incompetence - a concept that walks that all-too-fine line between humor and reality.

We’ve all seen it in action more times than we’d like. Ironically, some percentage of you will almost certainly be promoted to a position where you’re no longer effective. For some of you, that’s already happened. Sobering thought.

Well, here’s the thing. Not only is the Peter Principle alive and well in corporate America, but contrary to popular wisdom, it’s actually necessary for a healthy capitalist system. That’s right, you heard it here, folks, incompetence is a good thing. Here’s why.

Robert Browning once said, “A man’s reach should exceed his grasp.” It’s a powerful statement that means you should seek to improve your situation, strive to go above and beyond. Not only is that an embodiment of capitalism, but it also leads directly to the Peter Principle because, well, how do you know when to quit?

Now, most of us don’t perpetually reach for the stars, but until there’s clear evidence that we’re not doing ourselves or anyone else any good, we’re bound to keep right on reaching. After all, objectivity is notoriously difficult when opportunities for a better life are staring you right in the face.

I mean, who turns down promotions? Who doesn’t strive to reach that next rung on the ladder? When you get an email from an executive recruiter about a VP or CEO job, are you likely to respond, “Sorry, I think that may be beyond my competency” when you’ve got to send two kids to college and you may actually want to retire someday?

Didn’t people who wanted a better life for themselves and their children found America? God knows, there were plenty of indications that they shouldn’t take the plunge and, if they did, wouldn’t succeed. That’s called a challenge and, well, do you ever really know if you’ve reached too far until after the fact?

Perhaps the most interesting embodiment of all this is the way people feel about CEOs. Some think pretty much anyone can do a CEO’s job for a fraction of the compensation. Seriously, you hear that sort of thing a lot, especially these days with class warfare being the rage and all.

One client asked straight out in an email: “Would you agree that, in most cases, the company could fire the CEO and hire someone young, smart, and hungry at 1/10 the salary/perks/bonuses who would achieve the same performance?”

Sure, it’s easy: you just set the direction, hire a bunch of really smart executives, then get out of the way and let them do their jobs. Once in a blue moon you swoop in, deal with a problem, then return to your ivory tower. Simple.

Well, not exactly.

You see, I was a Sr. Principal Engineer in the early 80s for Computer Sciences Corporation, the company was founded in April 1959. Roy Nutt and Fletcher Jones, both in their late 20s, formed Computer Sciences Corporation with $100 and a contract from Honeywell to develop a business-language compiler called FACT. Assembling a small staff of talented people, CSC soon gained a reputation for innovative design and high-quality work. Nutt and Jones were the Steve Jobs and Bill Gates of their time.  Both were innovative, extremely intelligent, and had a vision not for just a company but the future.

As time moved forward CSC was at the top of their game until the 80s when executive leadership hiccupped and eventually the company was run by, let’s say, individuals who had no vision and rode their careers on inertia of the business.  The company survived and, in my opinion, overcame the incompetence of their leaders and was eventually replaced by visionaries once again.

Today CSC is one of the best-run corporations in the world today with over $16 billion in revenue ad assets and a net income of $834 million. Michael Laphen is their current CEO and I would put him as one of the most effective CEOs in the world today.

I’ve seen what a strong CEO can do for a company, its customers, its shareholders, and its employees. I’ve also seen the destruction the Peter Principle can bring to those same stakeholders. But, even now, after 30 years of corporate and consulting experience, the one thing I’ve never seen is a CEO or executive with an easy job.

That’s because there’s no such thing. And to think you can eliminate incompetency from the executive ranks when it exists at every organizational level is, to be blunt, childlike or Utopian thinking. It’s silly and trite. It doesn’t even make sense.

It’s not as if CSC’s board knew ahead of time that their executives in the 80s weren’t the right guys for the job. They had long, successful careers at the company. But the board did right the ship in time. And that’s the mark of a healthy system at work.

The other day I read a truly fantastic story in Fortune about the rise and fall of Jeffrey Kindler as CEO of troubled pharmaceutical giant Pfizer. I remember when he suddenly stepped down amidst all sorts of rumor and conjecture about the underlying causes of the shocking news.

What really happened is the guy had a fabulous career as a litigator, climbed the corporate ladder to general counsel of McDonald’s and then Pfizer, had some limited success in operations, and once he was promoted to CEO, flamed out. Not because he was incompetent - he wasn’t. And certainly not because he was a dysfunctional, antagonistic, micromanaging control freak - he was.

He failed because it was a really tough job and he was in over his head. It happens. It happens a lot. After all, this wasn’t just some everyday company that’s simple to run. This was Pfizer - a pharmaceutical giant with its top products going generic and a dried-up drug pipeline in need of a major overhaul.

The guy couldn’t handle it. And when executives with issues get in over their heads, their issues become their undoing. It comes as no surprise that folks at McDonald’s were surprised at the way he flamed out at Pfizer. That was a whole different ballgame.

Now, I bet those same people who think a CEO’s job is a piece of cake will have a similar response to the Kindler situation at Pfizer. Why take the job if he knew he couldn’t handle it? The board should have canned him before it got to that point. Why didn’t the guy’s executives speak up sooner?

Because, just like at CSC, nobody knows ahead of time if people are going to be effective on the next rung of the ladder. Every situation is unique and there are no questions or test that will foretell the future. I mean, it’s not as if King Solomon comes along and writes who the right guy for the job is on the wall.

The Peter Principle works because, in a capitalist system, there are top performers, abysmal failures, and everything in between. Expecting anything different when people must reach for the stars to achieve growth and success so our children have a better life than ours isn’t how it works in the real world.

The Peter Principle works because it’s the yin to Browning’s yang, the natural outcome of striving to better our lives. Want to know how to bring down a free market capitalist system? Don’t take the promotion because you’re afraid to fail.

Signals: Your Employees Think You Are a Jerk

Q: Steve, I work for a guy who is just a jerk. He yells at employees all day long, fires people every week — seemingly to keep people on edge — never gives raises, etc. And the worst part is, I can’t afford to quit. Why do people act this way?

– Alan

A: It never ceases to amaze me how many employees work for really bad small business owners. It is surprising for two reasons: First, how anyone can think that berating people works is just strange, but more importantly, the very nature of a small business is that they are intimate, close-knit affairs. Small businesses typically work in confined spaces and with only a few people. Under those circumstances especially, being a good boss is all the more important — to your staff, your business, and yes, to your bottom line.

But that doesn’t seem to stop the jerk small business owner:

▪             One guy wrote me, explaining that he told his boss that he would have to miss some work because his wife went into premature labor by about month. He was fired for his “a lack of commitment to the job.”

▪             One woman shared the story of how she was afraid to miss her shift at the local restaurant because the boss valued “team players.” So she showed up sick with the flu, contagious, but was praised for her work ethic. Most everyone got sick later that week.

Strangely, most of these small business owners probably think they are just doing their job to the best of their ability, helping out their business, but the truth is, they stink as managers. So how do you know if you’re doing something valuable to help your team and move the collective ball forward, or you’re just thinking of yourself and preoccupied with things like getting the right cover sheet on the TPS reports?

Here are the top 7 signs that, behind your back, your employees think you are a jerk:

1. You don’t know the difference between managing and micromanaging: A good small business owner knows about more than just how to run his or her business and make a profit. Good bosses manage their employees, allowing them to do their jobs the best they can. Jerk bosses try and tell their staff how to do their jobs, down to ridiculous detail. If you spend more of your time on silly minutiae and less on the big picture, your employees probably don’t like working for you.

2. You engage in petty office politics: Of course all businesses have their share of politics, but it is the bad boss indeed who ends up in the middle, playing favorites, pitting one player against another, all in a bid to build their pathetic little empire. You should have more important things to do with your time — like actually running your business.

3. You hide the ball: I once had a boss who gave me two days to do a project that really needed about three weeks. When I walked into her office 48 hours later, disheveled and with hardly any of the work product finished, she laughed and said, “I was just testing you.” Bad bosses have unclear motivations, strange priorities, and have no problem obfuscating.

If you don’t shoot straight, your staff probably mocks you behind your back.

4. You are a bully: It is like the boss in this question, bad bosses don’t inspire. They bully and humiliate people. They try and get people to do things their way by threatening them with a loss of their job, or by verbal attacks, or other similar methods that have nothing to do with making people feel and do their best. People who work under constant threats and fear hate their job and their boss and the business.

A sure way get your staff to resent you and undermine your business when you are not looking is to bully them.

5. You do not give credit where credit is due: Great bosses love to praise people for a job well done. Bad bosses are not only incapable of positive reinforcement; they also love to take credit for others’ work.

6. You lack consideration: Maybe you think nothing of giving a ton of work to someone late on a Friday, or you refuse to make accommodations to the schedule based on people’s real life needs. Whatever the case, you can be sure that your employees do not like working for you if you care more about whether the trains run on time, and less about them as people.

And the irony is, the more you care about them as people, the more the trains will run on time, not vice versa.

7. You are just a creep: Maybe you touch too much. Maybe you say inappropriate things. Maybe you tell off-color jokes. And you do these things because, hey, who can fire you?

Guess what? You are really a jerk to work for.