One of the worst things we have inherited form our British colonisers is our attitude to business failure.
The man who was in my lifetime the doyenne of business journalism was Harold Fridjohn, who decided quite late in life to switch from writing about business to doing it. He became a stockbroker, and after a period of apparent success, went bankrupt. He was thrown back into journalism, spending time in newsrooms guiding younger journalists with patience and kindness through the language of finance.
Writing his obituary, another younger British-born journalist described his act of moving to the Johannesburg Stock Exchange as a kind of hubris. Actually, it should have been celebrated, whether he failed or not. He tried something new, and for a time he thrived.
In popular British discourse an odd attitude to business failure is evident: it’s seen as shameful, embarrassing. I generalise, I know, but in the US, there is much more acceptance that businesses, especially small businesses, will fail, and that entrepreneurs might often have several false starts before succeeding.
Actually, in business as in life, failure is everywhere if you look. Success is the exception, and only apparent because the failures are no longer around. How many challengers to SA Breweries, for instance, sometimes backed by big money, sometimes not, are still in business?
Indeed, we learn through failure, not through success. Success tells us only that we are on the right track, that we need not change or reflect too much on what we’re doing. Failure invites us to think again about what we value and how we give expression to those values.
The author of the Harry Potter books has some telling comments about failure in a Harvard graduation address.
It’s hard to think of JK Rowling as a failure, but fail she did, and in her words “on an epic scale”.
“You might never fail on the scale I did, but some failure in life is inevitable. It is impossible to live without failing at something, unless you live so cautiously that you might as well not have lived at all — in which case, you fail by default.
“Failure gave me an inner security that I had never attained by passing examinations. Failure taught me things about myself that I could have learned no other way. I discovered that I had a strong will, and more discipline than I had suspected; I also found out that I had friends whose value was truly above rubies.”
As Rowling notes, failure of some sort it inevitable for all who get up off their arses. It is grating, however, that the critics tend to appear at the same time you are dealing with having to face failure, chanting like some Greek chorus, “I told you so”.
A feature of my British working class forebears that I found particularly unpleasant was their internalised class repression, their hatred, not of success, but of those who were “above themselves”.
Not only new ventures fail. Established firms often come to a point where they have to disappear, causing consternation, especially where their size and reputation seemed to shield them.
Even in the US, the most libertarian country, there is resistance to accepting that though in theory a firm can live forever in fact it won’t. Change is a constant, but something as human beings we do not always embrace.
And so in the US, the big three automakers, facing oblivion and inspired by the many billions of bailout dollars funnelled to financial firms, have asked government for a lifeline to escape bankruptcy.
It might delay the inevitable, which could take the form of mergers, acquisitions or winding up. But if the US automakers haven’t managed to adapt so far to the environment in which Japanese and German carmakers have thrived, what will another few months or years help?
In the coming months of financial hardship worldwide not only the automakers will have to learn to cope with failure. Businesspeople who have lived through booms and busts welcome downturns, because they shake out of the industry the wide boys and opportunists, leaving those whom customers value for their delivery of service and value for money.
It’s easy to be philosophical about failure when you don’t have to bear the consequences, you may say.
Business failure can be devastating both practically and psychologically. So it’s wise to try to avoid risk, unless you have the stamina to recover from the blows of misfortune.
On a purely material level, failing in business when you are approaching retirement or even are past retirement means you will not have a chance to try again, and may never recover.
Don’t be blinded by a dream to bet your nest egg on a venture with a slim chance of success. Better to leave it in inflation-linked bonds.
We speak too blithely about risk-taking, sometimes. Too rarely do we read or hear the stories of the defeated, because it is human not to want to dwell on what is painful.
And my news media colleagues frequently run the big and small success stories, rather than the examining in detail the reasons many business stories just don’t have a happy ending.
We could learn a lot about business by asking “What went wrong and why?” — not to lay blame but just to understand.
Author
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