Page 78 - The Resilient Organization

Case Study: Innovation Trauma and Resilience 65

able to accept, while keeping the innovators’ enthusiasm and emotional
engagement (a most critical ingredient for success) alive. It is worth invest-
ing in innovators to prevent them from becoming cynics or dropouts—the
default paths for traumatized innovators.

WHY LEARNING FROM FAILURE ISN’T EASY
(AND WHAT TO DO ABOUT IT)

Innovations fail at an alarming rate. Depending on the product category,
estimates range from between 40 and 90 percent (Gourville, 2006). Expla-
nations for failure are manifold and include product-based, developer-
based, and consumer-based reasons for failure (for example, Rogers, 1995;
Moore, 1991).
But by far the most common explanation hinges on the individuals car-
rying the innovation forward. Researchers have argued that such factors as
wishful thinking, overconfidence or even arrogance, escalation of commit-
ment, or plain ignorance are to blame. The common denominator among
these views is that emotional or ego involvement stands in the way of inno-
vation. For example, developers may “fall in love with the technology and
forget the markets it needs to serve” (Schnarrs, 1988).
We argue that not only can ego involvement stand in the way of innova-
tion but it can also damage confidence: innovators become gun-shy after a
failed innovation. We refer to this as innovation trauma. And while the ideal
of learning from failure is a good one, empirical research on innovation proj-
ects indicates no systematic relationship between the degree of project suc-
cess (or failure) and the amount of learning team members report stemming
from the same project (Hoegl & Gemuenden, 2001). It seems entirely intu-
itive, though, to assume that lessons from previous mistakes help future
undertakings. So why doesn’t it always hold true? The reason is that inno-
vative tasks naturally carry high risks (technical and market risks), and their
success often hinges on the unwavering commitment of various individuals
involved. Team members and management sponsors need to be personally
and emotionally engaged to drive key innovations forward. If and when such
innovations fail, we have to expect significant posttraumatic disorders lin-
gering for some time and getting in the way of learning from future projects.