You remember the cliche, success breeds success? Some recent research on decision making suggests that success can, in fact, breed failure by hindering learning at the individual and organizational level. Learning from success can present major challenges. Gino and Pisano (April 2011) outline 3 interrelated traps:
1) Fundamental attribution error: When we succeed, we think it was because of us. When we fail, we think random or external events conspired to derail us.
2) Overconfidence bias: Success breeds self-assurance and reinforces that we are on the right track. This overconfidence bias can lead to institutional arrogance and a “Not Invented Here” mentality.
3) Failure to ask why: This challenge involves the tendency to fail to systematically investigate causes of good performance: Leaders don’t ask the tough questions that can help them learn.
It’s always good when you read an article where there is a problem and a path forward toward a solution. In this case, Gino and Pisano suggest five tactics leaders can use to avoid these traps:
1) Celebrate but analyze your success: When a project is successful, leaders should lead investigation on reasons behind the success with the same rigor and scrutiny applied to failures.
2) Institute systematic reviews (After Action Reviews): Reviews should ask these questions: What did we set out to do? What actually happened? Why did it happen? What are we going to do next time? What are the top 5 things we would do again and the top 5 things we would not do again. The key is to ensure the same rigor for both failed and successful projects.
3) Use the right time horizons to gauge success or failure: By understanding the correct time horizons, you can prevent yourself from being fooled by randomness.
4) Replication is not learning: Six Sigma and TQM are great for determining root causes. Add to that by reviewing factors that are under your control as well as those that are affected by external events.
5) Experiment: Experimentation is a way to test assumptions and theories on what is needed to achieve high levels of performance. The right question for leaders is not “What is going well?” but “What experiments are we running?”