Failure Loop

What is it about the market that ‘works’? I mean, how do companies keep creating and innovating so consistently over time? How is it that you can invest money in your 20s and receive six times your investment when you retire in your 60s? How is it that people create value?

I’ll submit that the consistency and value of the market (of companies) and of people is directly tied to failure. You see, progress is made through trial and error. If there were no mistakes there would be nothing to learn from. The simple fact that companies and products sometimes fail is what drives innovation forward. It’s why entrepreneurs, regardless of their level of intelligence, are able to create immense value, they’re iterating on failure after failure. It’s why free markets have prevailed for centuries, failure is built into the mechanism. It’s why, on a personal level, the way that failure occurs to you will play an oversized role in your personal success. Winston Churchill famously said, “Success is the ability to go from one failure to another with no loss of enthusiasm.” But it’s even better than that, failures are the milestones on the way to success, they’re what makes success possible. So next time you fail, don’t dress it up, don’t make up reasons or excuses, squeeze every bit of valuable information you can out of it. It may have actually been a huge success.

Your new habit initiative is missing something


Humans are bad at starting new habits and jettisoning old ones. It doesn’t seem to help if we know better (like, smoking will eventually cause you to suffocate to death). Our level of desire or commitment isn’t a useful indicator. We typically come up with a great idea, what could probably be classified as a goal, some change we’d like to initiate in our lives, and then we hope for some motivation to strike so we can implement the new behavior. Unfortunately, motivation is undependable and scarce, and your new habit, as well-intentioned as it may have been, never comes alive.

But there’s a solution to this. James Clear, in his book Atomic Habits, explains that while our usual understanding of how to cause behavioral change (knowledge, motivation, earnest desire, strict discipline) is mostly worthless, an implementation intention plan can make all the difference.

So what’s an implementation intention plan? Well, stated as simply as possible, it’s your plan for the time and place you’re going to execute your new behavior. Clear says, “Most people think they lack motivation when what they really lack is clarity (P71).” When we fail to make the changes we intend we start to think we lack discipline or maybe we don’t want it enough. That’s purely false. What’s lacking is most likely not discipline, but a plan of action. When we leave our behavior change initiative to the erratic realm of inspiration and motivation we’re begging to fail. But if we’re clear about a time and a place, about when and where we’re going to execute our new habit, the likelihood that we’ll execute skyrockets. This can be as simple as choosing which chair you’ll sit in at what time in the morning to start your reading habit. I have two seats in my living room (there are more seats, just two that I claim), one couch corner for TV and video games, and one couch corner for reading and writing. It makes a weird, incredible difference which one I’m sitting in. When I’m in my reading spot, I read, when I’m in my TV spot, I watch TV. That’s about as complicated as it has to be. I execute my reading habit because I chose my seat and I decided on a regular time (quick aside, reading in the morning is the best).

I think this implementation intention plan, while super simple, is one of the most important concepts in the study of habit formation. We select times and places for all sorts of important things in life, meetings, family time, workouts, church, etc. Why do we try to sidestep this necessary piece when we’re dealing with ourselves?

An implementation intention plan is not the be-all-end-all magic dust that will guarantee the success of your new habit, but it is a critical piece and one that few of us consider. So stop worrying about whether or not you’re disciplined or motivated, pick your time and your place, and execute.

Be a failure

So here’s a question, why do we love motion so much? If motion isn’t what moves us forward, if it’s more like wasted time than productive time, how come we spend so much time on it? James Clear (author of Atomic Habits) has one more helpful suggestion here, he says it’s because motion lets us feel productive without risking anything. Action necessarily involves some risk of failure, which is obviously not ideal. Failure is the worst, or at least it seems like the worst. It’s super uncomfortable, awkward, humiliating, and generally terrifying as a prospect. It makes sense that we want to avoid it.
Malcolm Gladwell has some compelling thoughts on this topic. Based on the multitude of interviews he’s conducted with entrepreneurs and successful people, he discovered that a disproportionate ratio of them are dyslexic. Research backs this up, for some reason around 35% of company founders suffer from dyslexia compared to about 15% of the broader American population. Dyslexia is thought to be a great hindrance, what about a learning disability could push people to succeed? Gladwell suggests that the main reason for this implausible statistic is the fact that those who suffer from dyslexia have become so acquainted with failure. Take school for example, grade school provides an endless arena for dyslexic children to fail from early childhood. Reading, writing, test-taking, all of it is perfectly primed to flunk a dyslexic child. So while the rest of us were earning kudos and awards for our normal learning styles, those with dyslexia were learning a much more valuable lesson, how to fail again and again and again. People with dyslexia often demonstrate proficiency with verbal communication (because writing is very difficult), comfort with delegation (because they’ve had to rely on people for help), and other very helpful characteristics of an entrepreneur in a free market society. These characteristics are grown out of a response to failure and weakness. They’re more than a natural or genetic lean, these are learned out of necessity.
Gladwell is not the only one to theorize on the value of failure, Winston Churchill stated that “success is going from failure to failure without losing your enthusiasm.” C.S. Lewis said “failures, repeated failures, are finger posts on the road to achievement. One fails forward toward success.” Theodore Roosevelt, perhaps most famously, said “far better is it to dare mighty things, to win glorious triumphs, even though checkered by failure… than to rank with those poor spirits who neither enjoy nor suffer much, because they live in a gray twilight that knows not victory nor defeat.”
Failure seems scary, but maybe it’s time for a new perspective. Failure is actually your friend. Failure means that you’re taking risks, that you’re in the game, that you’re learning. So let’s embrace failure, let’s get comfortable with it. No more playing it safe with endless motion, we’re here to act. Be a failure, and find success.