I regularly speak at so-called FuckUp Nights, events where people talk about failed projects and companies. I like the format very much. To be able to talk about something implies that we have acknowledged and reflected on it. This kind of conversation has always been the best therapy for me. Because it obliges us to reflect on an experience, to structure it and to want to understand it. It’s about the following questions: What was my fuck-up? Why did it happen? What did I learn and what can others learn from this experience? All quite banal. And yet so difficult.
We live in a supposedly successful society that is focused on successful people. Failures are inevitably irrelevant. So we believe. In my world, success and failure are two sides of the same coin. When it comes to success, there is always the risk of failure. And when it comes to failure, there is always a chance of success. This is not a theory, it’s just the way it should be. We basically learn in two different ways. Through experience (trial & error) and through imitation. We gain experience when we try something new or we imitate it. And if we succeed, then our brain releases neurotransmitters such as dopamine, etc. This in turn encourages us to repeat the experience that we had. If we fail, this is accompanied by emotions of disappointment, frustration and doubt. Which tends to make us want to avoid a similar situation.
Tales of failure
There are plenty of stories about failure. We often talk about companies or their products. Ultimately though, it is always people who go through failure. Over the next few months, I will be reporting here regularly on so-called fuck-ups – failed companies, athletes, products, politicians – and what we can learn from them. Because that’s what it’s really about. It shouldn’t be the mistake, the failure or the fuck-up that has to be highlighted, but the experiences and lessons we can gain from them.
Today I would like to begin with my own fuck-up. I had to file for bankruptcy for my company in 2011. Prior to this in 2009, our market had collapsed by 50% and the banks lost confidence in us. This was despite our successful restructuring. That’s what went down. It would be easy to say now that we or the banks were to blame for the financial crisis. And for a while that’s certainly what I believed and thought. There was only one problem: why did my rivals, (who were in the same industry and some of whom were even with the same bank), make it? They certainly weren’t the culprits. But who then? No matter where I looked, I kept coming back to myself. To the decisions that I hadn’t made, that I had mistakenly made, or that I made too late. The information and advice I ignored. The facts that I didn’t want to believe because they didn’t fit into the image I had of myself or my company. The overestimation of the time and financial resources available to me and my company. The misplaced priorities I set because I thought it would somehow all work out. And so much more.
Many minor and major mistakes
We don’t just fail from one day to the next. Of course, there are cases where a totally unexpected event suddenly shakes the very foundations of a company’s business. But these are the exception rather than the rule. It is the many minor and major mistakes, lack of trust and poor judgement that cause a project, a career or a company to fail. Or, as a friend of mine put it: “Bert, it is not about not making mistakes. All that matters is that you make fewer mistakes than your competitors.
Five reasons for failure
What have I learned? Well, that entrepreneurs fail due to five reasons:
The first reason is lying to yourself. When we pursue a career, take over a project or take over the succession of a company. Even though we basically know in our hearts that we don’t really want to do that. When our heart really beats for something else other than what we are currently doing. When we fool ourselves that way.
The second reason is when we overestimate ourselves. If we overestimate our resources, our financial leeway, time constraints, the goodwill of our customers or the motivation of our employees.
The third reason is doubt. The opposite of overconfidence. When we are unaware of our strengths and competencies which we need, especially during difficult times. Or if we don’t trust these for some reason. When we lack tried and tested experience in dealing with difficult situations.
The fourth reason is the lack of decisiveness, which means that we cannot concentrate and focus on what is most important ahead of us.
Last but not least, the fifth reason is simply the randomness of life. The so-called black swan events, the occurrences that we believe will never happen and that if they did, they would never happen to us. As in my case, a 50% drop in the market – overnight.
About this column:
In a weekly column, written alternately by Bert Overlack, Mary Fiers, Peter de Kock, Eveline van Zeeland, Lucien Engelen, Tessie Hartjes, Jan Wouters, Katleen Gabriels and Auke Hoekstra, Innovation Origins tries to figure out what the future will look like. These columnists, occasionally joined by guest bloggers, are all working in their own way on solutions to the problems of our time. So that tomorrow is good. Here are all the previous articles.