Building a fast-failure-friendly firm

1. THE FAST-FAILURE FRIENDLY FIRM fail your way TO SUCCESS http://www.flickr.com/photos/geyring/

2. PROLOGUE WHY IT MATTERS

3. Pacemakers Post-its Penicillin The Light Bulb The Microwave Corn Flakes Discovery of the Americas Kitty Hawk Evolution The Slinky

4. $ These were all failures that led to mondo ducats

5. But, we shouldn't just say "Whoohooo! Let's fail more!"

6. Ideally, we should fail more, but fail smarter

7. that means we want to fail when….

8. 1. the costs of failure are low and the returns are high

9. 2. we can quickly determine if we're failing, so that we can pivot quickly

10. 3. we can learn effectively from the failure

11. this presentation is about how managers can build organizations that can do that

12. PART ONE WHAT IS FAILURE?

13. let's first differentiate between failures and f@*k ups

14. failures are legitimate mistakes

15. It's a legitimate mistake when you…

16. fumble because you lacked all the data, but had to move forward anyway

17. made a reasonable bet, but got unlucky with circumstances

18. invested in a low cost - high potential reward experiment

19. f@*k ups are stupid mistakes

20. It's a f@*k up when you…

21. failed to execute due diligence before or during

22. failed to learn from a legitimate mistake and repeated it

23. invested in a high cost – low potential reward experiment

24. PART TWO WHY FAIL?

25. let's talk about 8 reasons why legitimate mistakes can be valuable

26. REASON 1 Fail regularly to ensure that you keep striving Failure occurs when you stretch / grow yourself, because you are out of your comfort level. If you’re not failing, you’re likely not stretching. Explicitly track (and record) your rate of personal failures. Ensure 1 meaty screw up per quarter, or force yourself to move into personally uncharted waters.

27. REASON 2 Fail regularly so that you continue to be surprised Surprise is a key to innovation because it reveals opportunities. It also stores valuable Return on Investment if you learn from it. Seek out Failure and aggressively run retrospectives (post mortems). Celebrate what you learn positively, widely, and publicly.

28. REASON 3 Fail regularly to keep an open mind We are biologically predisposed to calcify assumptions & shy from cognitive dissonance. Shake things up before they can’t be dislodged. Compose a list of 10 things that you believed 15 years ago, which you now know are false, or at least, not quite right. Remember how sure you were.

29. REASON 4 Fail regularly so that you remind the ego to stay humble The greatest danger of confidence is over confidence Find and listen to the album “Nothing’s Shocking” by Jane’s Addiction. It has nothing to do with this topic. It’s just a fraking good album.

30. REASON 5 Fail regularly so that you build empathy for others who fail Most people fear failure because of how they think others will see them. It is peer pressure which makes us avoid what is innately good for us. Look around for someone who is currently failing and give them a shoulder to lean on. No questions asked. No judgements made.

31. REASON 6 Fail regularly so that you build confidence in your resilience One of the reasons that it was so hard to shave my head bald for the Children’s Cancer Foundation Hair for Hope program was the worry that it wouldn’t come back. It did. Compose a list of 3 big mistakes you’ve made in your life thus far. Appreciate that you got through them and that they are not nearly so dire years later.

32. REASON 7 Fail regularly to buildpractical recovery skills so that you get up faster & stronger next time ‘nuff said Go back to the retrospective you ran for Reason #2 and analyse the process after the failure rather than before. Identify 1 thing to improve with recovery next round.

33. REASON 8 Fail regularly so that failure becomes less scary & embarrassing Once you train your brain to see failure as an opportunity, it will become one Find someone who has failed (and who may feel privately ashamed) and let them know personally that it’s no big deal.

34. PART THREE HOW DO YOU BUILD A FAST-FAILURE FRIENDLY FIRM

35. if you are a manager or a leader

36. and you are now convinced that a bit more failure would be a good thing for your group

37. what do you do?

38. here are 5 simple, practical things that you can do at any level of an organization

39. PRACTICE 1 Iterate Faster & Smaller

40. PRACTICE 1 Iterate Faster & Smaller put in place a process to identify low-hanging opportunities where failure is low cost & high return

41. PRACTICE 1 Iterate Faster & Smaller do a bit of shot gunning with the results of the low-hanging fruit review. Commission many small bets and let the dice roll

42. PRACTICE 1 Iterate Faster & Smaller rewire your infrastructure/administration to support quick-iteration (e.g.: annual budgets….really?!?!)

43. PRACTICE 1 Iterate Faster & Smaller add "no-go" tollgates to avoid the basic human hard-wired tendency to throw good money after bad

44. PRACTICE 1 Iterate Faster & Smaller require business cases to identify minimum viable product features and customer validation metrics from the start

45. PRACTICE 1 Iterate Faster & Smaller define exit plans so that features (and applications) are designed for easy decommission if they don't work

46. PRACTICE 2 Celebrate Failure

47. PRACTICE 2 Celebrate Failure make sure that senior leaders celebrate great post-mortem learnings at townhalls or team meetings

48. PRACTICE 2 Celebrate Failure heck, have those leaders give out an award to the bravest or most resilient failing team of the quarter

49. PRACTICE 2 Celebrate Failure or at least, have them talk openly and broadly about the importance of smart failure

50. PRACTICE 2 Celebrate Failure at every level, use neuro linguistics such as, 'and versus but'