I’m a failure.  I fail a lot.  All the time, really. And in lots of ways.  I’m not as patient with my children as I’d like.  I’m not as productive at work as I’d like.  I’m not as good of a husband as I’d like. But this is not about any of the specific ways I fail because I’m far more interested in flipping failure on it’s head.

“What is failure?  How do we make it useful? How do we keep it from hurting us? “

I asked a local bartender “What makes a shift successful.”  His answer, “Nice customers and good tips.  Restaurant people are the best customers – they’ve been there before and always tip well.”  Makes sense.  A friend defined success as “on time and on budget.”

I don’t want to focus on success because total success is elusive – seemingly downright impossible.  We are frail creatures, after all, and are prone to coming up short.  I write this not as an excuse but as a realization.  Knowledge is power and knowing where we are currently gives us the power to grab failure by the collar and demand it tell us how we can do better.

I’m the senior software developer where I work and I’ve been wondering, “Organizationally what is failure?  How do we define it? How do we make it useful? How do we keep it from hurting us?  How do we move beyond immediate negative reactions and take a long term view?  More importantly, how do we create a culture that doesn’t punish failure and instead seeks to find the value in  failure?“

Failure is worthless when you fail to learn from your failure through accident or ignorance. The worst kind of worthless failure is produced by a culture that structurally prevents learning from failure. Not knowing if you’re failing, or at what rate you’re failing means you have no hope of making meaningful change.

Everything else is useful.  Think about conversion metrics.  For online businesses this is the ratio of  visitors converting to customers.  People tout their conversion rates like they are some measure of success.  “Oh, we have a 30% conversion rate!”  Wait, did you just tell me you lose 70% of all visitors?

In baseball failing most of the time is acceptable.  Failing half of the time is ridiculously good.  If you convert 30% of the time in baseball you’re going to make millions.  I don’t know what good conversion metrics are for an online business.  You probably have some idea what is acceptable for you.  It all depends on your acquisition cost and the lifetime value of a customer for your business.

But here’s the thing.  If you’re not learning from your failures be they a 2%, 10%, or 30% conversion rate (a 98%, 90%, 70% failure rate) you’re being hurt by your failure.  It’s time to turn that situation around and figure out how to learn. The answer is shockingly simple, but requires dedication and discipline.

Anyone can flip failure on its head,

Find yourself some third-class levers.

Did you know 3rd class levers even exist? (I didn’t.) A third class lever allows you to gain speed or distance at the expense of effort.  Put another way, the effort we use to improve our success rate can move it a lot (distance).

Row boats use 3rd class levers – effort translates into speed and distance.

It logically follows that you would pick areas of your business that have a high rate of failure – they represent the areas that can experience the largest amount of  improvement. In addition to the high rate of failure, you would also want to identify those areas that are frequently repeating and easily testable.

If you have a business that is profitable with a 2% conversion rate – a 3rd class lever can make a huge difference to the bottom line – you don’t have to move the needle much to get a doubling or tripling of revenues.

The exact details of your testing greatly depend upon your industry, your goals and the hypotheses you decide to test.  For example, to improve customer acquisition you might try changing the amount of information required on sign up forms. For trial accounts try testing a decision to not require a credit card.  For project management you might try testing a new methodology or technique.  For a pizza restaurant you might try a new approach to special prices or offering a more interesting pizza.

As a father I could try different approaches with family chores and rules. I could gamify things. Yes it’s more difficult to measure, but anecdotal evidence is acceptable in this situation.  The important thing is to be trying and measuring – in whatever way is appropriate.

When it comes to failing  when you learn from your mistakes you are honestly improving. If you are not learning you have truly failed and are doomed to repeat the past.

Anyone can flip failure on its head, in any industry and in any human endeavor.
Do you want to?