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Freedom to Fail (#95)

Source | www.robertglazer.com

We all need room to make mistakes. The goal should be to learn from them and move forward, without repeating them. An example of restricting that freedom is Volkswagen’s diesel engine debacle. According to many company executives, former CEO, Martin Winterkorn, was demanding, authoritarian and abhorred failure; he also fostered a climate of fear.

A key part of Volkswagen’s aggressive growth strategy was a new diesel engine that would deliver low emissions and high efficiency; the automotive Holy Grail, if you will. The problem was that, as the engine came into production, it didn’t meet the goals Winterkorn had publicly stated it would. Too afraid to bring this failure to their boss, the engineers used their collective ingenuity to cover up the problem, leading to billions of dollars in losses and damage to the brand.

A great example of a leader embracing failure can be found in Ray Dalio’s best-selling book, Principles. In it, Ray speaks about an expensive oversight that an employee made at his hedge fund and his decision not to fire the person. Ray believed that firing the employee would encourage others to conceal their mistakes out of fear.

Instead, Ray used the experience to create a “mistake log” where all mistakes were reported and logged company-wide so others could learn from them. Now, making mistakes is not a fire-able offense. However, failing to report a mistake is.

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