Failure Sucks but Instructs. Ask Starbucks.

Achieving milestones within a department or an organization is a process that involves a clear strategy, research, team members, and the flexibility to change and adapt along the way.  Just like leaders, a company’s culture or environment doesn’t just happen.  Great cultures are made from the top down and the down up.

The key in creating a corporate culture focused on high achievement doesn’t come from the learning curve employees and their teammates face but in how they learn and work together during their failures.  It’s the low points, not the high points that create a high performance team.  Or as Robert Sutton, a Professor at Stanford University says, “Failure sucks but instructs.”

Failure Sucks but Instructs. Ask Starbucks.

Consider a company like Starbucks, a now 40 year old company, and the success they achieved.  Since 1992 until 2007 the company’s stock rose a staggering 5,000 percent.  Books were written on their rise to fame and the culture distinct culture they created.  On nearly every corner a Starbucks reached out to entire communities, listened to individual workers and consumers, and seized growth market opportunities, and then something happened.  As the economy changed and the world dived deep into a recession, Starbucks continued with their award winning strategy business as usual, and for that they paid a price.

Companies like McDonalds and Duncan Donuts gained market share and Starbucks tried to fight back, but they continued to flounder.  In 2008, Howard Schultz the former president and chairman made a bold move returning to his position eight years after he stepped down.  He was concerned that Starbucks had lost its way culturally as well as financially.  The support and leadership that Schultz provided Starbucks helped put the company’s troubles into perspective allowing them to learn and adapt from their mistakes.  The company returned to its roots focusing on what it did best, make coffee as well as the culture it provides both employees as well as customers.  For Schultz, it’s not just about winning but the right way in which to win and using this strategy he helped once again pull Starbucks into the spotlight.

The lesson for companies of all sizes and their leadership teams is that from success we gain confidence but from failure we are truly tested.  Teams are tested in times of crisis and struggle learning lessons on accountability, collaboration, creativity, and initiative.  Maintaining an even keel and believing in your organization and its business culture will help ensure that even in the good times and the bad, the business will live to fight another day.

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Jessica Miller-Merrell

Jessica Miller-Merrell

Jessica Miller-Merrell (@jmillermerrell) is a workplace change agent, author and consultant focused on human resources and talent acquisition living in Austin, TX. Recognized by Forbes as a top 50 social media influencer and is a global speaker. She’s the founder of Workology, a workplace HR resource and host of the Workology Podcast.

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  1. AvatarDerek Irvine, Globoforce says

    Brilliant: “The key in creating a corporate culture focused on high achievement doesn’t come from the learning curve employees and their teammates face but in how they learn and work together during their failures. ”

    That’s why I think it’s so important to recognize and appreciate the “failure” – most companies tag this as something more palatable like “taking risks.” But what would an R&D department be without a lot of risk..and consequently…a lot of failure.

    Ben Miele, a VP of sales in my company, wrote a post about this, describing how this played out in a client organization:

    For example, a Globoforce client recently shared with us the greater benefit they are realizing by recognizing and charting values-based behaviors by department. Two of their values are “risk taking” and “achieving results.” The client was appalled to see that in the R&D department, far more recognition was received for “achieving results” than for “risk taking.”

    This is precisely the opposite of the recognition and reward scenario this client wanted to see out of its R&D group. They need their R&D team to be frequently taking risks to find the next great idea. Leadership does not expect every risky idea to turn into a successful “result.” But if the people in R&D don’t take risks, the “next great thing” will never be discovered.

    Thanks to the insight gleaned from their Strategic Recognition Values Distribution Chart, our client was able to intervene in the R&D department to remind managers and employees alike that “taking risks” – even before results of any kind are known – should be praised and rewarded.

    The rest of that post is here: http://globoforce.com/globoblog/2011/08/11/how-to-proactively-manage-your-culture-through-your-values/

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