The corporate world can be an unforgiving place for people who make strategic mistakes in the marketplace. Take a look at what happened to Hewlett-Packard when they took a shot at creating their own tablet and operating system through their Palm division.

On the surface, the idea seemed solid. Palm had been a leader in creating handheld innovation for a number of years. Jumping into the market with another alternative for consumers, therefore, projected internally as a project that stood a chance. After spending a billion dollars and then famously pulling the products off the market and changing CEO’s, Hewlett Packard seems to have validated at least one thing that the market found useful — a very low price point for sophisticated electronics is a winner.
Is it Time for a Different Perspective?

p2And while it is understandable that decisions that relate so closely to a company’s bottom line come with some repercussions, there are those that would argue that in the creative space and in development, maybe mistakes should be looked at differently.

The seeds for this approach came in the 20th century, when historian Barbara Tuchman wrote a book called “The March of Folly.” After spending nearly a year in Japan as a tourist and a journalist, Tuchman wrote about how wars and specifically quagmires often occur because leaders make a mistake and then cannot back away from it without admitting that it was a mistake. Of course with the admission that they made a mistake would come the potential repercussions, which are normally enough for many leaders to choose to continue on and try and play through the problem.

When applied to real world business problems, some leaders noted that there is actually a parallel. The development manager that covers a glaring defect until it is out in the market is actually costing the company a lot more money than they would have to pay if the problem were fixed upstream.

Ed Catmul at Pixar has in the past noted that because mistakes are going to happen, that treating them as if they are part of the development process instead of looking at them as a pass-fail setback can actually make your company a stronger entity.

Some of the logic behind his argument is that when you look at management as a role, it is possible to say that part of management’s job is helping the firm move on from mistakes that have caused problems. If you see that as being part of their role, the dynamic changes from “a mistake was made and we need to deny it and cover it up as best we can” to “how can we learn from this and what can we do to recover perfectly from an obvious mistake.” It is thought that there is more freedom in the second dynamic that will allow managers tasked with making difficult decisions the leeway to outperform counterparts that are shackled to a linear progression that oftentimes ends with a counterpart’s ouster.

Practice Makes Perfect

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In practice, looking at what research and development organizations do when faced with mistakes and problems can be quite illuminating:

Dogfooding as a solution: Ever since Netscape arose on the internet scene in the 1990’s, several tech companies have used dogfooding, or using their own imperfect software products in order to make them perfect and provide feedback before they are released to the general public. The concept does lend itself to fits and starts within a company using this process- yet it also helps the development team see what the customer will see and react to long before they ever see it.

Changing the paradigm: Although Microsoft is not well known forsatellite internet, over a decade ago, it took on a project to provide high-speed internet access to a lot of the world using low-level satellites that would provide VSAT internet services for consumers in many areas that did not have this service. In technology, sometimes being the early adopter doesn’t pan out from a cost standpoint, and so several years later, they wrote off a reputed 9 billion dollars in expense. It took a while for the industry to come back from that, yet Google decided to take a different approach and use balloons as a way of controlling costs. Their project is scheduled to go live in Indonesia to millions of people over the next few years.

Post-release quality: Several years ago, Abbott Laboratories undertook a hardware/software project that was subsequently passed on to its subsidiary. As it entailed certification through the FDA, it was a 5 year development cycle that had the strictest controls placed on it. Just the same, although there were plenty of staff to oversee the processes that had been traditionally successful, a mistake slipped through after the product went into production that caused the firm to issue a recall in order to ensure that there was no risk to their clients. And although that added millions of dollars to the bottom line, the fact that management ferreted out the problem instead of covering it up soon after the launch meant that they actually saved money over what would have been a much larger recall a few months later. The takeaway for the firm was that were able to innovate in the industry by adding a quality team that focused on products that were ready for launch, another layer of quality that has served them well.

Overall, mistakes will happen and your firm can react traditionally or take the exercise as a learning experience that will help it in the future. Regardless of which path you choose, knowing that there is more than one way to look at a mistake that is made should help management make better decisions- before and after mistakes occur.

 

By:  Vincent Stokes