In our travels around Wyoming, we have frequently asked the question, “What do we need to create a more fertile and successful entrepreneurial ecosystem in the state?” The most frequently heard response has been, “Create a more entrepreneurial culture in which failure and sharing the lessons learned is accepted.” Foremost among them were people like Matt Kaufman, an attorney that is very active in the Wyoming startup community and a member of the ENDOW executive council.
Ironically, haven’t residents of Wyoming have been acting independently and entrepreneurially for more than a hundred years in solving problems? It is hard to believe that those attempts didn’t sometimes lead to failures and learning from them. How can we be more open about sharing lessons from failure?
The challenge of starting new ventures or even dealing with the challenges of the 21st century is dealing with lack of information, unpredictability, uncertainty, and risk in both personal and business pursuits. In dealing with situations that are very new or in which not much information is available, it doesn’t pay to sit it your office and try to analyze the situation. You don’t have much to analyze. You have to be experimental.
So, in a very real sense you have to try something, learn and adapt. The book Just Start, which was written by Jerome Schlesinger and two others, offers some relevant insights and strategies. Schlesinger was president of Babson College, whose entrepreneurship program has been ranked first in the world for decades and where entrepreneurship pervades every program and curriculum. The book was based in large part on the research of Saras Sarasvathy, who studied the nature of serial entrepreneurs extensively. Schlesinger and his co-authors discovered that the entrepreneurial mindsets and strategies apply to much of life, not just startups, today and more so in the future. They point out that predicting the future is more and more difficult. As Yogi Berra once said, “It's tough to make predictions, especially about the future.”
The authors contend that in the face of unpredictability, lack of information, and uncertainty, action leads to evidence and learning, thinking does not. They posed a strategy for which they coined the phrase “Creaction” (a contraction of creative action). Creaction involves
Necessarily, acting in the face of uncertainty and lack of information will lead to failure a significant percentage of the time. That is the nature of the circumstances and the approach. So failure is an inherent part of being entrepreneurial.
However the authors point out that there are smart ways to act and to experiment. They call them “smart steps.” A smart step has two attributes:
In order to do that you must use what the Japanese call Genchi Gembutsu, “Go and See” for yourself. The benefits can be surprising. During the startup of an earlier firm, we developed an ecommerce platform that would enable large companies with multiple facilities to buy electricity and natural gas to operate their retail stores, hotels, office buildings, and restaurants—companies that eventually included JC Penny, Lowes, Hyatt, Boston Market, and many others—in competitive energy markets.
In order to enable competitive suppliers to price and bid on these opportunities, we had to obtain and make available a significant amount of data about the facilities, their needs, and their energy consumption. Because we lacked information about what was needed and had limited resources, it was with significant trepidation that we made available our rather simple and rough initial web platform, which was clearly only minimally complete and viable. Nevertheless, we went ahead. To our surprise, not only did suppliers try it, they gave significant feedback on its shortcomings. One supplier even exclaimed, “This is refreshing, you are the only competitor that has actually asked us what we needed to bid.” Our willingness to take the risk and expose our initial solution failures led to a better solution. It also led to ownership by users.
What are your thoughts? What has been your experience? Share your failures and lessons learned. Please share them in the discussion on the IIE web site at: https://www.uwyo-iie.org/index.php/results/community/discussion-why-does-wyoming-need-more-failure
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