Should you reward success?
Rewarding success is the obvious thing to do. Slaps on the back, public praise, bonuses and honours come easily to us. People expect to be rewarded for good performance. If you reward success then people will strive to give you more of it. It would be madness to reward failure, or so the logic goes.
It isn’t quite that straightforward. If you play a high stakes game with big bonuses then beware of the downsides:
- People won’t try anything new, for fear it will go wrong.
- The minute something starts to fail people will give up.
- If you only ever reward success people will never admit to failure.
If nobody ever tries anything new, perseveres or shares their failures, then your organisation will never learn.
Praise is a good thing, but high stakes and contingent (if you do this then you will get that) rewards for success are a fool’s errand. Remember the story of Nick Leeson and beware.
Should you reward failure?
If you want to get better at something you must try out new ideas, test things out and learn from them. You only learn when you fail, so, paradoxically, the more you fail the more you learn and the more likely you are to succeed.
Consequently, you should reward failures and history — or at least the internet — will tell you this is true
Anyone who has never made a mistake has never tried anything new
Albert Einstein
I’ve not failed, I’ve just found ten thousand ways that don’t work
Thomas Edison
Success is stumbling from failure to failure with no loss of enthusiasm
Winston Churchill
Intellectually this is all sound, although it is emotionally hard to stomach. Failure smells, and rewarding it sticks in one’s craw. The newspapers and politicians will have a field day. It is a brave man who tries to get this reward strategy past his CEO.
Rewarding failure is a fool’s errand
The biggest sin of all
The best predictor of the number of good ideas a person has is the number of ideas he tries.
Bob Sutton is a professor of management science at Stanford University. He points out that the biggest sin isn’t failure, but inaction. In his book Weird Ideas that Work he suggests that you shouldn’t reward success or failure but output.
- The number of production trials run
- The number of lab experiments completed
- The number of prototypes built
- The number of patents filed
- The number of test products launched
Make sure that your staff know that failure to execute is the greatest failure.
The twist
There is — of course — no point in rewarding people who are busy repeating the same failure.
There is nothing so useless as doing efficiently that which should not be done at all
Peter Drucker
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James,
I’m sure you’re not suggesting that we only learn through failure, knowing you I know you apply the same method of critical examination of success and failure – I’ve learnt as much from things that worked out as those that didn’t. Personally I’ve long suspected that the path to major failure is paved with many minor successes which create the false belief that competence levels are higher than they are and/or false confidence levels which leads to a lackadaisical approach to risk.
In my life I’ve had a lot of goes at failing, many of which haven’t happened. When we exist in systems which have such a high number of variables (whether life or business) we’ve moved so far beyond the capabilities of the caveman brain we all inherited. As you’ve expressed to me previously, the human brain can cater to and manage a finite level of input before it starts to shut down and deviate to the mean – Steve Peters I always thought was ascribed to this view (The Chimp Paradox). I also recall a conversation between Joe Hyams (screenwriter) and Bruce Lee (yes, the actual one) which the former outlines in his book “Zen in the Martial Arts” during which Bruce explains to Joe that instead of focusing on the outcome / output he should focus on what he is able to influence – the process. A theme I’ve found common in zen thinking – focus on your processes.
I also recall similar business school discussions around the failure of entrepreneurs as a guideline to success. I believe the number of failed enterprises before ‘success’ was an average of six – but that falls squarely into the ‘don’t trust that at face value’ school or quote. I’d also say that ‘success’ was defined very broadly – it was that the entity was still a going concern at three to five years old.
There is also the experience of a life lived in consultancy and interim work. When you frequently enter works which are inflight, the ability you hold personally – agency – to influence the outcome is further reduced. Therefore, a keen understanding of that agency will help you navigate a challenging life with a better mindset. It isn’t always something I understood, I’m grateful to the wiser heads who advised me in my early days. The influence and narrowing of agency definitely drives the need to openly assess and critique your own performance on a process not outcome basis – what did I do well / okay / poorly ? How much of any success or failure was outside of my control and how much of it was completely unexpected ? The last part of that question also leads me to ask myself, was it unexpected because I failed to see it coming, or was it a complete left-field random event that cannot reasonably be forecast / expected.
In summary, I actually try to allow myself to work on the ‘Airline Pilot’ model of self reporting when it comes to process analysis. In effect, if I self report any deficiency of performance (regardless of the actual outcome) and I resolve that and learn from it – I take no personal reproach or grievance. If I note the failure and fail to learn / adapt / mitigate it moving forward then I do give myself a hard time – I accept that humans will make errors, I just do my best to avoid making the same one twice.
Fab blog as always, hope you are keeping well !
Matt
Thanks for the comment Matt, far better thought through than the post.
Common sense tells us that Reward and Recognition are complex assessments and yet we keep trying to make them formulaic and transparent… but often frequently destructive. If I had my time again I would have more conversations, be more challenging and recognise thinking and action more than outcomes.
Just keep sacking the bottom 10% Bob, everything will be fine.
Nicely put and particularly relevant in the realm of data science where failure is the norm (until you validate an hypothesis and uncover a valuable insight from your data).
Be able to run more experiments and test more models becomes a key competitive advantage and one the best ways to find the ‘valuable’ needle in a data haystack.
So, in the context of data science, you should empower people to run more experiments (per day/week/month)… rewarding for failed experiments however can have side effects (data scientits are clever people and many would abuse such performance metric). ;-)
A bit narrow as an article and a tad stereotypical in its commentary. Sure it’s what the internet likes and certainly generates nice motivational pictures on walls. But the reality is often people are recruited specifically to do a good job of failing; because failure is recognised as the solution, hence if they do a good job they are promoted and given more work.
How else can seemingly failed CEO’s move on successfully. It only looks like a problem when you don’t fully understand the context you are looking at.
So yes, is the answer, quite often failure requires competent leadership and management and is extremely well remunerated.
Look at it another way, a feint is a move which will
Fail, but allows another move to succeed. We know this to be true just playing everyday games. We sacrifice pawns on the chess board every time we play. We are well versed in managed failure in our daily lives. There are inherent rewards in failure.
I think perhaps what the article really referring to is “should incompetence be rewarded” and to that I say No, except where it is again strategically deployed aka the “useful idiot” scenario.
Life if so complicated.
I remember a simple challenge we used to run up in Ambleside Andrew, where the objective was simply to get a team from one side to the other without touching the ground, using a collection of boxes and planks. There was no penalty for failing other than starting again… and yet so many teams wouldn’t try any ideas for fear of failing. The best teams just launched right in and learnt from the failures, and in the end, succeeded. I think the challenge in business is how to reward/encourage failed effort that comes before the success, especially when assessment is driven buy an irrelevant annual cycle.
I believe that is one definition Bob and I remember the exercise well. But anyone versed in the ways of power knows that purposeful failure is a powerful strategy when needed. It all depends at what level you decide to have a conversation like this. For the most part, and for your average employee, supporting failure in the pursuit of improvement is a good thing and worth supporting.
But as I have learnt over all these years: believing other people think like you is a fundamentally flawed perspective.
Fear is the big concern here, which you mentioned. But how can you overcome fear in the fearful, when that fear is injected at birth and coveted by the social systems around it. Managing fear is the greatest challenge most people have in their lives.
Interesting thought (yet again!) – if you reward people with big bonuses you induce ‘fixed mindset’ behaviour (Carol Dweck, “Mindset”), the very opposite of the ‘growth mindset’ needed for growth and success.