Learn From Failure

Then the financial crisis hit. And for a company whose business is rooted in managing people’s financial lives, Metzger said dull and dependable didn’t seem so bad after all. Prudential scrapped developing the innovation initiative, though it still established a similar leadership competency. “We’ve scaled back our thinking from innovation to intelligent risk,” Metzger said.

Define Success
Driving a culture where innovation spurred by failures is a prominent part of the learning process is useless if there is no clear vision of success to begin with. Rose Gailey, a consultant at Chicago-based organizational performance and strategy firm Gagen MacDonald, said leaders must establish a clear definition of success to properly measure or evaluate what’s to be learned — both when success or failure occurs. Doing so allows leaders to more accurately evaluate opportunities for lessons learned, she said, and is best accomplished when feedback and reviews are on a constant loop.

“If we’re going to pick up on failure, and we’re going to tackle each failure, but we don’t have a clear understanding of the path — where we’re going and what the outcomes are — it can be a really huge hindrance,” Gailey said.

Some organizations use a method derived from the military called after-action reviews to evaluate potential lessons. In these reviews key stakeholders meet to review what went right or wrong in a given project.

Metzger said Prudential took a liking to the method a few years ago; the company also trained a cadre of people to run the sessions. The after-action reviews started on major company projects, but are now used to reflect on smaller projects and have been integrated into some day-to-day meetings.

Yet after-action reviews, while prudent in some respects, are only effective learning tools when followed up with more action, an area where some organizations may falter. Deloitte’s Lessel said not taking action could be detrimental to this type of improvement process. “Unless you make changes based on those observed lessons, then they aren’t truly lessons learned.”