Inspiring Innovation Through Failure

When trying to establish a culture of innovation, an essential aspect is the acceptance of failure. In this last post of our series, Yves Karcher, former executive at Logitech, shares examples from his experience about how to deal with failures.

 

Tilo Peters: My comment is “You learn nothing from success. And although it hurts like hell, you learn a lot from failure. Failure can only happen when you’re trying something different.” Is that correct?

Yves Karcher: Yes, we failed and I personally failed in areas that were completely new and we were experimenting. This is an interesting failure because we learnt a lot from it, but we also failed in execution. We thought things would be easy to execute and we did not play our role as leaders. We let it go with closed eyes. It failed miserably because of our lack of interest. Many companies have experienced different kinds of failures, but for me and the companies I’ve been working with, there are innovation failures and execution failures. Hence the name of my company, InnoExec – innovation and execution.

What are your key learnings about failure?

Failure is certainly a frustrating moment because you have to recognize that something isn’t working. You put so much energy into it and convince people why we should go for it. A few months later you pull the plug and you have to explain why you pulled the plug. It is a difficult moment and it is tough to have a happy face. If we are able to do an after-action review or report and debrief collectively about what we have learnt, people have a sense of closure and a sense that they are not going to do the same failure again.

So, don’t do the same mistake twice?

Certainly, and one of the key learnings is also to fail cheap. Don’t invest all the profit of the company in an endeavour that may fail. We need to keep it in frame and recognise a failure sufficiently early (but not too early!).

Sometimes it’s hard to get managers to think in those terms. In academia, we talk about “real options approach” to R&D development and the option in this case is to abandon. But evidence suggests that very few managers take that option and capitalise early on. They end up either with letting a project stagnate or keep pushing it in the hope that it will go from “failure” column to “win” column. How do you prevent the managers from adhering so much to this fear of failure?

Every company is different and each case is different so it is hard to have a general view. In my case, the emotions play a key role. Things that you have been proposing in the idea showcase are something that you have seen growing. It is your baby and you really want it to succeed by all means. If it doesn’t succeed the way you want, you start thinking of a different angle: maybe if this technology doesn’t go into this product, then you could create another product. You add another project that reuses the same core technology but is still not successful. This creates a sense of “let’s work harder, let’s try more”, whereas at some point you should be able to stand out and say “This doesn’t make sense anymore, because the customer does not care about this particular product or technology. Why bother?” And having this stance is very difficult because we end up like a rat in our cage, turning faster and faster, not looking left and right. Dialogue with external people makes a big difference sometimes because it allows to take some distance in your thinking.

We talked about failure from the management side, but what about the social cultural aspect? For example, in the US failure is not seen as a stain, while in some Asian cultures, failure is taken as a personal thing and even in Europe, it is not easily discussed. How do we address this?

When you manage international teams, you get across these cultural differences. Cancelling a project in Taiwan has different repercussions as in the Silicon Valley. In Silicon Valley, people wonder what’s next and I am insisting to insert a learning phase between a cancelled project and a new one. In China or Taiwan, you need to explain in details why you are cancelling a particular project. People take it personally and believe they should have worked harder. It is a sign of engagement with the company. But it is true and leaders should be aware of that when managing international teams.

One thing about lean innovation and lean start-up culture is to fail early and often. Do you think that using that paradigm has an ability to educate people people within companies and make them accept failure more easily?

I wished I would have coached more start-ups earlier in my career, because I would have embraced such quicker cycles and I would have helped the culture to revolve around getting the feedback early and do something about it to make a decision. Unfortunately, I see this only today and I wished that I would have seen this 10 years ago.

So you think that education would have helped you with our experiences at Logitech?

If I could use a time machine and go back 10 years ago, I would have coached start-ups already in my position at Logitech and I would have encouraged my colleagues to do the same. Not only to bring the start-up spirit to the company but also see how fast they go to develop, test and prototype new things in a matter of days, get feedback and redo the cycle. This is something from which we could have benefited in some areas of Logitech at that time. The reason why Logitech is in Switzerland, at the EPFL innovation park has something to do with acting like a small company and being able to be at the same speed with a mindset of a small company.

What are some examples from your experiences, things that were either good failures for learning or just monumental failures from an organizational perspective?

I can relate with the example of the digital pen that we designed over 10 years ago. We were in love with the technology. We were an engineering company and engineers needed a tool to exchange with other sites, annotate screens from somebody else.  The need for a computerized pencil was there. It took little effort to convince marketing that this could be a product. The company believed it and we marketed a digital pen without understanding why people take notes. We did not understand who has the need for such a product: students, architects, general public? Unsure of what to do, we did something that would appeal to everybody and this was a mistake. We lacked insights and focus that would address these insights, whether gain or pain. And I would have encouraged engineers to gather insights by observing one another, by asking open-ended questions and listening, by empathizing and asking 5 times the questions “Why?” until we get to the bottom of the issue of why we should put a particular feature into a product.

So the digital pen was something that in the long-run brought an awareness how to approach this process, didn’t it?

It definitely helped to turn Logitech from an engineering-driven company to a more customer focused company.

 

Our series of posts about implementing an innovation culture has come to an end. The key insights from the discussions with Yves Karcher can be summarised as follows:

  • When recognising the need for change, it is key to have a rigorous approach. Organisation structure cannot be left aside and should be aligned with the innovation strategy. A simple tool that could be used as a starting point to organise and define processes within a company, a department or even a project can be the Star Model.
  • Any tool implemented by a company to encourage innovation cannot function without a proper “operating system” – the people. Feedback, open discussions and rewards (beyond financial) are key to simulate a mindset of curiosity and a collaborative improvement of ideas. “
  • When developing a product, go through design and prototyping cycles fast and multiple times while integrating the feedback from each cycle. Seek feedback from external people to avoid being trapped in a project that is not meant to succeed. Gather sufficient insights about your potential market and uncover the bottom of the problem you are trying to solve for the consumer, using for example the “5 Why?” approach. (A short post about this problem-solving technique can be found here.)
  • For international teams, the differences in approaches to failure cannot be overlooked.
  • Fail small but fail often.