Innovation has never been so critical for today’s businesses. Customers have higher expectations, technology is changing the game, and new competition can come from unlikely places. Innovation is now a team sport—everyone needs to be involved and invested in creating value for customers.
The world has changed, that much we know. It’s the rate of change that is staggering.
Agility matters when innovating in this environment. It means cultivating an innovation culture of fast failure—quicker learning—and quickly pivoting your organization to take advantage of opportunities in the market. Simply put, being agile means you can bring ideas to life faster. But ideas are only good until they fail. Therefore, it’s always better to fail sooner than later, so you can course-correct before it’s too late.
The best companies successfully encourage and support their teams to be customer-centric, data-driven, agile, experimental, and failure tolerant. But this is of course easier said than done. In the words of Albert Einstein, the path to success “is not only long but difficult as well”. Here’s when a culture of fast failure comes to play.
Let’s demystify the phrase - Fast failure
We know that testing with real customers early in the process results in better learning than testing with them late in the process. Mainly because there is more to fix early on than later (Read ‘How to innovate effectively when you’re not google or amazon’). If you wait too long before testing, you may unwittingly become attached to your idea and not want to hear about any problems with it - then you won't make necessary changes that slow down your ability to succeed.
Fast failure is taking action. It’s about experimenting and moving forward quickly to learn what works and what doesn’t. It’s getting rid of your what-ifs and instead, gives a clear direction to what should be done next based on the learnings. Fast failures within your organization allow you to validate (or invalidate) hypotheses like “Will people pay for this idea?” or “Am I targeting the right segment?”. If you have not failed at all, it simply means you have not tried enough or that you didn’t fail fast enough to use those learnings to get on track. To create a customer-centric culture that embarks on innovation with confidence, one must learn to overcome the fear of failure.
Overcoming the fear of failure
As humans (and innovators), we are built with a fear of failure. Simply being human means fearing the unknown and fearing not knowing what will happen when things don't go as planned. It's this fear that leads us to be overly cautious and risk-averse, even when the consequences could lead to better learning outcomes in the long run. This state of mind can lead to far more harm than good.
Experimentation is often critical to innovation, so don't be afraid to try something new. Embracing failure as a necessary component of innovation allows you to take advantage of our objective reality.
Some don't embrace failure at all; instead, they just focus on failure when it happens and then decide whether or not they should move forward based on how bad it turned out. This path—failing fast without understanding why it happened—may seem like a good idea at first; but if failure isn't embraced properly, then you may never understand why things didn't work out (or maybe get stuck trying another tactic that gets them nowhere) and never learn from their mistakes (and thus never grow).
Without it, you will make flawed decisions that affect the health of your venture. With it, you will not be afraid to fail because you know that failure means new learning. Failure is only a bad thing if you’re not learning from it.
Fast failure = faster learning, to fail fast = test fast
The question lies in knowing what will work and what won’t. The answer: test ideas quickly to see if they work in real life before making further commitments (for example with development resources). It’s about bringing ideas to life as fast as possible, evaluating the results, and deciding whether or not to continue with them. The secret sauce is developing your ability to “fail fast” — in other words, being able to spot early on when an idea is worth pursuing or when it should be dropped like a hot potato!
The key to faster learning is simple if not easy: you must test your ideas and assumptions. You need to break the status quo and experiment with new markets, products, business models, and strategies. Learn from these failures - they are far less costly than a global market entry gone wrong! Identify what doesn’t work as soon as possible and move on to something else or try a different approach. Iterate, iterate and iterate again… this will lead to faster learning.
1. Accept the truth, even when it hurts
An innovation culture of fast failure can enable a company to be more agile and outcompete its competitors by acting on what the market needs quickly. But you need to set some ground rules. Here are the principles we follow religiously.
2. Letting data speak its beautiful language
Visualize your data in meaningful ways and you’ll be able to spot patterns and identify trends easily. Data can direct your business decisions and help you determine the next steps based on unbiased insights. An idea may have been brilliant on paper but turns out disappointing in real life. By conducting market-fit tests and obtaining actionable data on that idea, you can prevent spending more resources developing an idea without market potential
3. Customers don't always know what they want until after they’ve experienced it
We’ve said it before and will say it again. Making business decisions based on opinions is dangerous, if not fatal territory. Being experimental in your innovation allows you to quickly simulate the core experience of an idea and test it in the market as if it already exists. This captures a genuine reaction of the market. But be wary about marketing laws. In certain countries, you cannot market a product that doesn’t exist. This means, you need to be transparent with your experiments and do it strategically, so you can still get unbiased insights from the data you collected.
We’ve covered how to test your new ideas with your brand on it in our “Why products fail and how to avoid it” guide. You can download it here.
4. Find your risk tolerance
A risk that doesn’t pay off can take you back to square one. Failing fast is one of the phrases that has become part of the innovation culture. Other phrases in use are failing forward and fail cheap - not necessarily cheaper but certainly less costly than launching a fully-fledged product or service without the necessary unbiased insights from the market. Low-risk isn’t always low-cost; failing fast doesn’t mean taking off before you can get your bearings straight or crashing into a wall – it means knowing when to bail out of your idea in favor of one that works. So as an organization, you have to know how much risks you can stomach.
Not sure where to begin?
We at pree.to conduct experiments for companies, so they can get curated and unbiased insights from the market.
