Mistake Bank bookshelf: Paul Schoemaker's "Brilliant Mistakes" - mistakes as strategic assets

Kwame recently posted this comment: "No more mistake bank bookshelf? I am a huge fan of your work. supported kickstarter and would like to see more books that focus on mistakes." That was the impetus I needed to restart this segment. I have three mistake books in the reading queue, but for the moment I wanted to reshare a classic in the field, Paul Schoemaker's Brilliant Mistakes: Finding Success on the Far Side of Failure.

Schoemaker's book is a highly strategic look at mistakes. (He and a collaborator, Robert Gunther, originated the concept of "deliberate mistakes," which is to me the most counterintuitive and least-understood concept we've covered here) To Schoemaker, mistakes are tools for understanding the world, learning more quickly, and discovering deep insights.

I've had the opportunity to meet him and his book is a perfect reflection of his keen mind and curious soul. Brilliant Mistakes was my favorite book of 2011, and you should read it too.

From the book: Companies strive for error elimination, hiring advisers and relying on sophisticated management tools such as Six Sigma. It’s little wonder, then, that most decision-making books follow suit, encouraging you to focus narrowly on mistake avoidance today rather than provoking you to plan for the stream of decisions that you will face tomorrow.

Balanced self-awareness is essential to success

Camille Sweeney and Josh Gosfield wrote in the New York Times about the importance of self-awareness in achieving success ("Secret Ingredient for Success"). Sweeney and Gosfield are the authors of "The Art of Doing: How Superachievers Do What They Do and How They Do It So Well." In the article, they tell the story of renowned chef David Chang, who struggled after starting Momofuku Noodle Bar in New York City:

Mr. Chang could have blamed someone else for his troubles, or worked harder (though available evidence suggests that might not have been possible) or he could have made minor tweaks to the menu. Instead he looked inward and subjected himself to brutal self-assessment.

Was the humble noodle bar of his dreams economically viable? Sure, a traditional noodle dish had its charm but wouldn't work as the mainstay of a restaurant if he hoped to pay his bills.

Mr. Chang changed course. Rather than worry about what a noodle bar should serve, he and his cooks stalked the produce at the greenmarket for inspiration. Then they went back to the kitchen and cooked as if it was their last meal, crowding the menu with wild combinations of dishes they'd want to eat - tripe and sweetbreads, headcheese and flavor-packed culinary mashups like a Korean-style burrito. What happened next Mr. Chang still considers "kind of ridiculous" - the crowds came, rave reviews piled up, awards followed and unimaginable opportunities presented themselves.

During the 1970s, Chris Argyris, a business theorist at Harvard Business School (and now, at 89, a professor emeritus) began to research what happens to organizations and people, like Mr. Chang, when they find obstacles in their paths.

Professor Argyris called the most common response single loop learning - an insular mental process in which we consider possible external or technical reasons for obstacles.

Less common but vastly more effective is the cognitive approach that Professor Argyris called double-loop learning. In this mode we - like Mr. Chang - question every aspect of our approach, including our methodology, biases and deeply held assumptions. This more psychologically nuanced self-examination requires that we honestly challenge our beliefs and summon the courage to act on that information, which may lead to fresh ways of thinking about our lives and our goals.

We've written about this prescription over and over again on this site. Self-awareness is a key to success - and it involves scrutinizing our strengths, weaknesses, and deepest assumptions about the world. It requires viewing ourselves at a slight remove, so we can diagnose the things we must do to be successful.

It involves "facing actual circumstances," instead of what we wish would happen, as Justin Menkes described in "Better Under Pressure: How Great Leaders Bring Out the Best in Themselves and Others."

It involves a balanced look at our successes and failures - unlike Lafley & Martin.

It may even benefit from Paul Schoemaker's "deliberate mistake" - an action taken counter to your own sense of what will work.

You cannot control external factors. As the Buddhists say, you can only control what you do and how you react to things that happen. By cultivating self-awareness (including by tracking and evaluating the things that don't go to plan)

Thinking about deliberate mistakes

As we prepare for the US Thanksgiving Day holiday, I am thankful for the book I'm reading right now, Paul Schoemaker's "Brilliant Mistakes." Here's a quote (one of many excellent observations in the book):

Companies strive for error elimination, hiring advisers and relying on sophisticated management tools such as Six Sigma. It’s little wonder, then, that most decision-making books follow suit, encouraging you to focus narrowly on mistake avoidance today rather than provoking you to plan for the stream of decisions that you will face tomorrow.

Schoemaker feels so strongly that in complex, dynamic environments (like any business) deep-rooted assumptions are the seeds of decline, he challenges us to make "deliberate mistakes" - violating one of these deeply-held beliefs (in a limited, experimental setting), to measure whether it is still valid.

The idea of deliberate mistakes causes me to think of Cynthia Kurtz's story work. Cynthia was adamant that any observation she made (or that I made) about a project we were doing should be countered with an alternate view. If I thought a set of stories pointed to a positive view of the client, Cynthia would counter, "What would a pessimist say?" And after exploring that for a few minutes, I could equally well make the case that those stories also had an ominous subtext. Evaluating situations in this way began to illuminate their complexity, as jewels that shone differently depending on which facets were held to the light.

I spent many months working with a large wireless carrier, helping them make sense of stories their customers were telling them in customer-service calls. It struck me that many of the leaders, upon hearing of an issue, would very quickly formulate a strong hypothesis about what was going on, without any specific evidence.

In one case, we were trying to investigate a situation where an alarmingly large number of customers, when they were changing their rate plans, were dropping their data packages. The immediate reaction was this: "customer service representatives are not trying hard enough to sell the value of the data packages."

I tended to identify more with the customers, given that I had little history with the company, and saw a few different possibilities. I tried to use Cynthia's approach to add nuance to the problem: "What would your customer service rep think is going on here?" "What is the customer's view of this?"

The managers I worked with on this project - lower- and mid-level managers - were receptive. They could easily place themselves in the shoes of the customer, or the rep. A few alternate hypotheses surfaced quickly: customers might not be getting value out of the data package, and the rate plan change caused them to do this evaluation; customers might have a fixed budget and could not keep the new plan and the package without raising their bill; customers might be looking specifically for ways to lower their bill.

Soon we had six hypotheses that we could test. Yet, on this and other projects, the complex truth had to fight against simple judgments, and it was a hard fight. If the practice of deliberate mistakes could be ingrained in companies like this one, we could spend more time trying stuff out and finding what works instead of arguing our own viewpoints.

Which arguments, at the end of the day, don't matter to the business.

Paul Schoemaker discusses "Brilliant Mistakes"

More than five years after his terrific HBR article (written with Robert Gunther), "The Wisdom of Deliberate Mistakes," Paul Schoemaker of the Wharton School has published a book on the subject. "Brilliant Mistakes: Finding Success on the Far Side of Failure" extends the thinking from the article, and is a great gift to those of us who want to improve how we, as Schoemaker says, "invite mistakes into our lives." One of the key values of mistakes, he states, is to overturn our assumptions and allow us to see reality more clearly.

The Wharton School has posted an interview with Schoemaker on its site (you can see the video below). Knowledge@Wharton is also conducting a "Brilliant Mistakes Contest" if you'd like to share your story.

Here are some choice quotes:

A brilliant mistake is an action you take or a prediction you make that turns out to be wrong. This hurts you initially, but then it also opens up new vistas, and it may result in innovation and discovery. You start to see the world -- or yourself -- differently. For example: You get fired from a job unexpectedly and it prompts a lot of learning. Or you enter a new market or a new technology, and initially, many things don't work out well, but the benefits eventually make that "mistake" more than compensate for its cost....

You have to look at the conditions that favor these brilliant kinds of mistakes. If there is a lot of uncertainty, and the world has changed on you and your old ways of thinking are not quite the right ones, then you have to create more space to discover new approaches....

Very few people want to say they favor mistakes. However, I was also struck [by the fact] that many very successful people have not only a tolerant approach to mistakes, in music or in sports, but they actually embrace them, to some extent. They have an intuitive sense that these mistakes are, as James Joyce put it, "portals of discovery." These are new venues, new avenues for having insights that otherwise you wouldn't get. That's the key: The mistake is an expensive way to get to new insight. But if that is the only way to get to that insight, it may still be worth pursuing.

I've posted my "brilliant mistake" here.

Related post: Benefiting from deliberate mistakes

Benefiting from "deliberate" mistakes

In the June 2006 Harvard Business Review, Paul Schoemaker and Robert Gunther write about ways companies get bound up in their own assumptions, and thereby miss important opportunities for growth or improvement.

Their proposal? Deliberately make a "mistake" by doing something that violates an assumption you hold, to test whether the assumption needs to be altered. (Their article can be found here. Note: you need to be a subscriber to access the full contents online.)

Schoemaker and Gunther cite an example where the Bell System decided to forgo security deposits from some customers their systems had identified as credit risks. This was done in a controlled way, with a small but significant sample size, in order to test their approach to dealing with credit-risky customers. They found that their rules for requiring deposits were too strict, and that many of the customers who otherwise would have not opened an account (because they couldn't afford the up-front deposit) turned out to be reliable payers. Adjusting the processes based on the test added, according to the article, $137 million per year to the Bell System's profits.

Here are some highlights from the article:

Although organizations need to make mistakes in order to improve, they go to great lengths to avoid anything resembling an error. That’s because most companies are designed for optimum performance rather than learning, and mistakes are seen as defects that need to be minimized. Executives, moreover, perceive that flawless execution is what makes them valuable to the organization. In business (with the possible exception of venture capital firms and entrepreneurial start-ups), an executive’s reputation and rewards are typically based on the height of his or her successes, not on the depth of learning from failures.

and

Many managers recognize the value of experimentation, but they usually design experiments to confirm their initial assumptions. An advertising company typically may try different approaches to see which tactics work best but won’t run an ad that it presumes will fail. Experiments of this type aren’t deliberate mistakes. True deliberate mistakes are expected, on the basis of current assumptions, to fail and not be worth the cost of the experiment. According to conventional wisdom, they have a negative expected value. But if such a mistake unexpectedly succeeds, then it has undermined at least one current assumption (and, often, more). That is what creates opportunities for profitable learning.

Have you upended any of your assumptions recently? Perhaps it's time you made a few more mistakes--on purpose.