ONE of the biggest factors holding back would-be entrepreneurs is the fear of failure. It is hardly surprising — failure can mean not only losing your home and savings, but also humiliation. But while repeated and persistent failure is of no use to anyone, discovering how not to do something can be far more useful in the long run than doing it the right way first time.
Kim Fletcher, a business adviser with Business Link in Kent, said the first step in dealing with failure was to stop taking it personally. “You need to be able to detach yourself from it. If you regard failure as being something personal, you will not be able to take a step outside it and look at it dispassionately,” he said.
“You have to be able to say I did this, so what happened? Was it the right decision or the wrong decision? What information didn’t I have that would have helped me make a better decision that would not have taken me down this route?” He said a vital element of being able to learn from your failures was first analysing the type of failure you experienced so you can find out the reason for it. Normally, on closer inspection, it would be obvious what had caused it.
“Is it a failure because you lost money, or because you lost a customer, or because you lost a person in your business? Perhaps you were far too engaged in the technology at the expense of delivering what the customer wanted? “Perhaps you didn’t have sufficient finance to make the product or be able to survive long enough to get the product to market. Or you got the quality wrong or the timing was wrong or you didn’t have the right skills to get it to market. Or the product was behind the curve or it was the wrong price or you weren’t approaching people in the right way.”
If you find it impossible to dispassionately analyse the reasons for failure, he said, you should enlist outside help. “Sometimes talking it through with someone from outside the business helps. They might be able to see clearly where it went wrong.”
Daniel Ronen, chief executive of DoS UK, a business consultancy, said the big benefit of making a mistake was that it gave you time to reflect: “Failure forces you to stop, look, think and act. And that is the cycle everyone should be doing in business.
“The problem is that people are so busy acting and doing what they are doing that they do not stop and take a hard look at what is working and what is not working and what needs to change. But with failure you are actually forced to stop what you are doing and start thinking about it again — and that is why it can be so useful.”
Ronen said Britons had much to learn from Americans about the importance of failure. In America failure does not carry the stigma it does in this country. Indeed, in America entrepreneurs are not deemed to have earned their stripes or to be a force to be reckoned with until they have notched up at least a couple of disasters.
Ronen said: “In America if you go for a job and say you have had five businesses that have failed, they will look at that as a positive thing because the Americans know that failure can teach you a lot.”
Of course, failure can take many forms. There is the kind of failure where you did not take advantage of a new market and so sales suffered, and there is the kind of failure where you have been trying to sell the wrong kind of product to the wrong group of people and as a result your business goes under and you lose everything.
While one is obviously easier to deal with, they can both teach you valuable lessons about the nature of your business, provided you have the patience and the willingness to learn.
Ronen said that the secret was to ignore your detractors and concentrate on seeing your failures as your own personal lessons in business success. And try not to be so hard on yourself. “Very few people are born brilliant business people,” he said. “Failing forces you to stop what you were doing and look at what went wrong.
