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Business Biology 101: How Failure Plays A Role In Business Evolution

| Blog | January 2, 2012

"Success is 99% failure." -Soichiro Honda

What I’m going to say may shock you. You may not agree with it because  it goes against a popular strain of propganda that has (disastrously) infected America’s business ethos, but it is as true as the sun shines and the sky is blue. No matter what you’ve heard, failure is necessary for success. Ask any successful CEO and they will tell you that some of the most important lessons they learned on the road to success were in their failures. Failures allow us to hold a mirror to ourselves, to evaluate what went wrong and, if we’re strong enough, move through the foggy haze of losing and toward the gleaming brilliance of success.

"Success is 99% failure." -Soichiro Honda

Just look at evolution. The first class I took while I was studying for a biology degree was human origins, where I learned about how evolution got us to where we are now. We all (should) know about natural selection: the nonrandom process by which biological traits become either more or less common in a population as a function of differential reproduction of their bearers. What fewer people know is how bottlenecking events drive that evolution. In these events a significant percentage of a population is either killed or prevented from reproducing, left in the cold while everyone else gets to continue the species.  These are the things that lead to BREAKTHROUGH.

It’s the same in business, though perhaps not as cruel. Look at the post office. The Internet has more or less been a bottlenecking event for traditional post. Shipping companies and increased online bill payment systems have siphoned billions in revenue from the USPS – causing it to close more than half of its processing centers. Companies better suited for the Internet age are blossoming while brands that can’t bridge the gap are falling into oblivion.

In his 2007 book, The Dip, Seth Godin focuses on learning when to identify when something is failing and quitting before that happens. Chris Cameron, of Read Write Web, writes:

“The Dip,” as Godin defines it, is the valley between initial luck and long-term success. When learning any skill, the very beginning is fun and exciting as we quickly grasp new information and abilities. But at some point shortly after, the long, slow and difficult climb toward mastery makes us want to give up. This same analogy applies to numerous markets and situations, including sports, sales, job hunting and entrepreneurialism.

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