The Success of Failure

The Success of Failure

 

What makes a successful innovation?

 

The US has been blessed by a series of dramatic innovations over time: electrification, telephones, personal computers. Some of these have been truly disruptive, changing not only the way people do their jobs, but the very jobs themselves. Indeed, mastering the dynamics of innovation is critical for any company. In the past year corporations that file with the SEC used the word “innovation” over 33 thousand times in their annual and quarterly reports!

 

But by its very nature innovation is unpredictable. Doing new things in new ways upsets the status quo. Email is challenging the Postal Service; digital photography probably bankrupted Kodak.

 

And implementing innovation is risky. When social networking was in its infancy, companies like sixdegrees, Tribe.net, Friendster, and MySpace all tried to capitalize on the trend. None of them fully captured the market and many of them folded along the way. But one of the reasons Facebook succeeded where others didn’t was that there is little stigma in the US to failing at a new business venture. Bankruptcy laws allow entrepreneurs to walk away from unsuccessful projects, and the lessons from those failures can be incorporated into the next attempt.

 

If a job is worth doing, it’s worth doing badly, at least to start out. Because our institutions and culture accept failure, we have remained a hub for innovation around the world. The results can be disruptive, but using new technologies to improve the way we do things has helped make the US the most productive economy in the world.

 

But it often starts with failure.

By | 2017-07-17T12:34:54+00:00 May 23rd, 2012|Global Market Update, New Markets|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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