Alex Bombeck, CEO at North Highland.
For many years, I’ve helped CEOs and their organizations become “made for change”—that is, adopt a flexible mindset to help the company not just weather storms, but become stronger. Research shows that adaptive organizations grow at triple the rate of their more rigid counterparts, meaning that flexibility may actually be the safer and more stable strategy. This has never been more relevant than in the last few years and will very likely continue to be key, as new technologies become more disruptive and marketplace, societal and global economic change continues to accelerate.
One thing is clear: As we adapt to these changes, there will be bumps and, inevitably, failures along the way. This is, after all, how we learn and grow. The key is to get comfortable with the likelihood of failing from time to time and to share those instances of learning-by-failing alongside your employees. If you do, they’ll have a lot more trust in you (something I’ve learned personally!) as well as the courage to embrace risk themselves. This is where organizations really start to become made for change.
Organizations aiming to become more flexible generally need to do three things. Broadly, they are:
1. Make the case for change. The C-suite must collectively recognize the guiding truth that strategic, intentional flexibility equates to long-term success and improved value creation. Oftentimes, a pivotal moment will prompt that recognition. Be clear about the consequences of not changing.
2. Establish ways of working that allow for small, frequent changes. As you move toward a made-for-change future, determine how your teams will collaborate to enable the small, more frequent incremental changes that characterize fully flexible organizations. Transparency is critical. Little and often is only doable when your teams are empowered to makes decisions for themselves.
3. Enable and trust employees to power this shift. Psychological safety is essential here. And as this new culture takes root within an organization, employees will be increasingly comfortable experimenting and even “failing fast” in a safe space.
Again, I want to linger on this last part: failure. This concept is challenging for many of us, understandably, but it’s a critical part of adapting to change. And we’ve seen the importance of this mindset before.
In the 1990s, the internet was disrupting entire industries, and it was critical to adapt quickly. I was in the ad business at the time, and when digital advertising first arrived, it scared a lot of people—they feared the unknown. Marketing leaders were suddenly in a position where they had to think about shifting from the highly predictable channels of broadcast, print and direct mail (imagine!) to the wild west of digital display advertising, which had zero predictability at the time. Even though print and mailing costs were rising and returns were diminishing, the digital world was seemingly even more frightening because of the lack of predictability and the technical complexity. Many marketing leaders felt it wasn’t worth the risk of failure.
Here’s the real kicker: Those same leaders were also being faced with reductions to their budgets while being asked to deliver incremental performance, which was itself a recipe for failure unless something changed. Ultimately, we did make the leap, but we would have been better off had we embraced it sooner. The real failure was an unwillingness to change.
We’re entering a similar era of disruption now, with generative AI and other technologies poised to shake up whole industries. This is where comfort with failure is key. Leaders need to be OK with the idea that entering the unknown—even when it’s the right thing to do—comes with some degree of bumpiness. Perhaps we need to think more like scientists, regarding unexpected results not as failures but as learnings to inform future work. CEOs should adopt the curious-experimenter mindset and infuse your team with the belief that some bumps are expected when you’re going down an unknown path.
Going a step further, it’s critical not just to live this out as a leader, but to let your employees hear about you failing from time to time yourself. Years ago, I made the mistake of trying to always appear polished in front of my employees. And when I got feedback from a manager that people didn’t fully trust me as a leader because I shared only successes and hid failures, it was wake-up call that made me reassess my attitude around failure and transparency. I became a firm believer in letting your people see your failures so that they’ll feel the freedom to take risks of their own.
Some companies already do this. One major corporation I know of launched “Plucked Up Fridays,” town hall-like meetings where a leader presented a professional “pluck up” along with learnings. This is a great example of acknowledging failure with a “test-and-learn” approach in an intentional and public way. There are other, less-public ways to share and learn from failures too, like creating a corporate “experiments” database to catalog change initiatives. Document answers to key questions such as: What worked? What didn’t? What did we learn? What we are going to try next as a result?
These practices may not make sense for every company, but at the very least, talk with your employees about your own failures over the years. Be candid. Be transparent about how failure is a part of growth. Model the importance of thinking creatively, experimenting and learning from both positive and negative outcomes. And create the psychological safety for employees that leads to real growth for them and the company.
Again, let’s think more like scientists. If we all adopted a bit of a scientific methodology mindset in our organization, maybe change would be easier. Perhaps failure would be seen simply as a step on the road to success.
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