How Jeff Bezos Thinks About Failure
Jeff Bezos was recently quoted in an interview talking about how the Amazon Fire phone was a failure, and Amazon plans to make failures that “make the Fire Phone look like a tiny little blip.” Full quote here:
"If you think that's a big failure, we're working on much bigger failures right now. And I am not kidding. And some of them are going to make the Fire Phone look like a tiny little blip," Bezos said in an interview with The Washington Post's executive editor, Martin Baron, on Wednesday.
Bezos is famous for his knack of taking experiments and accepting failure as a learning experience. He reiterated his thinking during the interview.
"The size of your mistakes needs to grow along with" the company, Bezos said. "If it doesn't, you're not going to be inventing at scale that can actually move the needle."
And to do so, you need to make "big, noticeable" mistakes.
via Business Insider.
We are becoming more comfortable at dealing with failed product launches. As we become more and more of a knowledge society, we need to become comfortable with increasing rates of failure, because the success of technology is even more disparate - huge benefits from a few bets while the rest are failures. At all levels of industry, including rarefied public corporations, the benefits from a big risk paying off can far outweigh the cost of a failed launch.
Bezos continues with:
The great thing is when you take this approach, a small number of winners pay for dozens, hundreds of failures. And so every single important thing that we have done has taken a lot of risk taking, perseverance, guts, and some of them have worked out, most of them have not. That has to happen at every scale level, all the way down, and you have to take shots...you always learn something and you move on.
The Information does a great job echoing this sentiment about Twitter’s recent lack of failures. Essentially, if your organization is not failing very much, that means it is likely not on the edge of chaos and not taking enough bets that might amount to wins.
This is also why many companies do not want to go public. Wall Street lacks a vocabulary for failure. They just call it a “success” or a “flop” and most investors who are buying and selling stock based on earnings are looking at things in a very short-sighted way. It's a very one-dimensional way of evaluating technology companies. It's more akin to valuing a textile factory than it is a tech company.
Even in the upper-echelons of academia and business, we should develop a better a vocabulary for failure. Our understanding of something is only as good as the vocabulary we use to describe it. In Japanese culture, for example, there are over 20 ways of saying “sorry.”
Different types of failure:
- Execution failure: we could not deliver on time.
- Market failure: we delivered, but the market did not want what we built.
- Reliability / Sustainability failure: we delivered, the market wanted what we built, but we could not sustain.
- Tail risk failure: everything went right, but we could not overcome an outside force.
Needless to say, we should not begin projects expecting them to fail. Doing so would be negligent. But if we can rationalize trying something, and the cost of failure is low enough, why not give it a try?