Not long ago, I was talking with some of our teams about a new product, and there was a lot of fear in those conversations. People were asking whether they were the ones who could deliver it to the customer and whether we were really the company that could do it. If you're a leader and you want to create a culture of innovation, you have to be really okay with failure.
I talked about this during a recent Trax live conversation on leading through constant change. We covered adaptability, playbooks and continuous learning, and risk came up more than once.
Start by Accepting That Volatility Is Permanent
If you're making plans for consistency, it's not going to happen. In logistics, you get missiles in the Red Sea, anxiety over the Strait of Hormuz and the Strait of Taiwan and a Panama Canal that isn't working. Something is happening at every moment of the day, and you'd better adapt.
The first step is accepting that it's going to be volatile. Once you do, you can get to the next step, which is figuring out how to adapt. As a leader, I can tell you cultural adaptation is way more important than technical adaptation. This is also where I think people get it wrong. Staying where you are is way more dangerous.
Take Real Risks Without Betting the Farm
What I constantly tell people is to take risks. I'm not talking about bet-the-farm-on-black risks. I mean deciding to build a new product, design something in a certain way or serve a customer.
A friend of mine who's a pastor put this in perspective for me. He pointed out that getting married is a risk and having children is a risk. When I asked my wife to marry me, I didn't know if I had enough money or if I could take care of her. I didn't know if I'd be a good dad. You step into the risk, and you do it with a bit of faith.
Deciding whether to build a new product or serve a customer is the same kind of risk.
Live on the Short Branches
An old boss of mine gave me a great mental analogy. He told his team that they lived on the short branches. They were going to try new things, and when those things didn't work, the branch would break. When it did, he'd pick them up and throw them back up in the tree. If he yelled at them instead, they would never leave the safety of the trunk.
Build a Culture of Innovation by Taking the Blame Yourself
We launched a new product not long ago that gives customers feedback on how to improve their operations. When I was talking to the teams about it, there was a lot of fear. So I took a weekend with an LLM to figure out how to do it and how the calculation should work, and I brought them the prototype.
I told them that if it went poorly, I would go to the meeting with them, with the customer. When the customer laughed at them, pointed at them and told them they were an idiot, I would be the idiot. I would take credit for the failure. If it went well, I would give them the credit. Then I asked how that sounded for a deal.
They took me up on it. It's been received incredibly well by operations leaders and procurement people, because they can see this information in a way they've never been able to see it before. Now we've got a bunch of believers.
If you want to create a culture of innovation, you have to be really okay with failure. You have to encourage it and encourage people to go out and take that risk.
Shrink the Fear Down to Its Real Size
The personal, emotional risk of failure is real. It's not made up, and it's never as bad as you think it is. In your head, you've worked out that your career is going to end if you get this wrong. In reality, you just have a bad hour. By the end of the year, you'll know a way not to do it.
The same goes for the whole company. When a risk doesn't work, the company shouldn't feel like it fell on its face. It should feel like it found one way not to do something.
Pick a Couple of Risky Bets and Catch Your People When They Fall
My advice for leaders guiding a team through uncertainty is to pick a couple of risky things you want to do and go do them. When they fail, pick your people up, dust them off and throw them back up in the tree. Get clear on what you want to be the best in the world at, and be willing to take some risks to get there.
The full conversation is in the video above, including how I think about replacing playbooks with first principles and why I think companies should pay for training for anyone who wants to learn. You can find more of my articles on the Trax blog, and you can subscribe to the Trax channel to catch the next live session.