Home » Business » Entrepreneurship

Don't Be Defensive about Your Mistakes, Profit from Them

Mar 9, 2008
Drawing the right lesson from an apparent mistake can produce enormous benefits. The fact that you didn't achieve the result you wanted doesn't mean that what you did achieve isn't worth something, maybe even something more important than you started out after.

Consider the now-famous story of how Scotch Guard was discovered at 3M. Company chemists had been working on new chemical compounds for a variety of purposes.

One day, one of these compounds was accidentally dropped onto a sneaker. As the weeks went by, the worker kept gazing idly at the white spot on her sneaker where no dirt was clinging. Eventually she mentioned this oddity to a coworker, and ultimately a profitable new line of research was established that led to Scotch Guard.

The chemistry behind Post-it Notes were similarly discovered by accident during research into how to find very strong adhesives.

Every experiment and experience teaches us something, if we only take time to consider what the lesson is. Learning the lesson should be our goal instead of minimizing the significance of what happened or trying to cover it up if it's not the goal we intended.

Peter Drucker exhorted organizations to seek out all of their unexplained successes and failures, and to determine what really happened. He felt that this is the best way to make breakthrough improvements.

You have just had an opportunity to learn something, but you have yet to complete the learning. Heeding Drucker's advice, a researcher noticed that a normally effective model for forecasting the direction of a company's stock price drastically underestimated stock-price growth from time to time.

The answer to this apparent anomaly turned out to be that a particularly unusual and desirable mix of investors had been accidentally attracted to these companies, which created a much higher stock-price multiple due to a combination of greatly expanded demand and much reduced supply of stock. A new management process was then developed to allow companies to routinely achieve this result.

In another experience by the same researcher, an earlier stock-price model had usually failed when external factors affected a whole industry in a significantly positive or negative way. Rather than giving in to frustration and failure, the researcher pressed on. By determining the source of over- and underestimation came a much improved model-building process that accounted for these factors, and greatly increased forecast accuracy under all circumstances.

Where have you enjoyed unexpected setbacks?

What were the causes of those setbacks?

How can those causes be employed to create opportunities?
About the Author
Donald Mitchell is an author of seven books including Adventures of an Optimist, The 2,000 Percent Squared Solution, The 2,000 Percent Solution, The 2,000 Percent Solution Workbook, The Irresistible Growth Enterprise, and The Ultimate Competitive Advantage. Read about creating breakthroughs through 2,000 percent solutions and receive tips by e-mail by registering for free at

http://www.2000percentsolution.com .
Rating:
Please Rate:
(Average: Not rated)
Views: 139
Print Email Report Share
Article Categories