Companies that have recovered from major failures have learned more from the experience and have become more successful as a result, according to research from the University of Colorado Denver School of Business.

The knowledge that came from success didn’t seem to carry as much weight as the knowledge that came from failure, which was retained much, much longer, according to one researcher.  Organizations are misguided when they attempt to not recognize failure, or to push it aside, and move past it as quickly and unobtrusively as possible.  When failure occurs, those responsible often get fired, when it would be of more benefit to the organization if they treated failure as a learning opportunity, the researcher said.

Researchers compared the response of NASA to the space shuttle Atlantis in 2002 and the space shuttle Columbia.  On the first shuttle flight, a piece of insulation came off, which damaged the solid rocket booster, but did not affect the overall mission.  After the mission, NASA did little to look into the incident, according to the researchers.  However, during Columbia’s mission, another piece of insulation came off, in this case destroying the shuttle and killing the seven people on board.  After that catastrophe, NASA stopped all of the shuttle flights and conducted an intense study of the disaster that led to 29 recommendations to prevent a recurrence.  The difference in the response, according to the researchers, hinged on the fact that the first mission was seen as a success, while the second was a failure.

Whenever there was a failure, the response of NASA was to search for solutions to the failure, according to the researchers.  This response puts the organization into a more open and flexible attitude, where there is a willingness to take a hard look at current practices and routines, what the weaknesses of those practices may be, and how to improve them.  The researchers pointed to the airline industry as an example of companies that learned important safety lessons from failures.  Even though there are thousands of flights a day, the number of problems is tiny.  This is because airlines have learned from their mistakes and the older airlines, which have more experience, have a lower degree of accidents, the researchers said.

They recommend that companies should reevaluate how they look at their practices and should learn to analyze even smaller incidents of failure, rather than ignoring them, and apply the lessons they learn from them, rather than risk those smaller incidents resulting in a major failure down the line.

The insight gained from the study, according to the researchers, is that failures should not be ignored, nor should employees be branded by failure. Instead, failures should be seen as important opportunities for learning and the sharing of information about them.

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