June’s top business books

Adapt: Why success always starts with failure by Tim Harford

(Little Brown, RRP$17.82)

Failure is a fashionable topic. No less than the Harvard Business Review recently devoted an entire edition to the issue.

It’s hardly a new idea. Most product launches fail initially, but if the process is handled effectively, it can lead to success.

It is still argued that the introduction of “new” Coke wasn’t a failure. The problem was addressed and in the end Coca Cola market share was lifted.

Harford says failure is endemic in modern business and society, not because people are more prone to failure, but simply because everything is more complex.

Management is overwhelmed with information and ideas to the extent that no one person could be expected to make consistently correct decisions.

He also makes the point that no one ever did, including some of history’s acknowledged leaders. Winston Churchill, widely seen as a great wartime leader in the Second World War, was responsible for the ill-fated and ill-planned Gallipoli campaign in the First World War.

It was a major failure and presumably one from which Churchill learned a great deal, even if at great cost.

That’s essentially the theme of this book. We are going to have failures, so how do we limit their impact and use them to move forward to success.

The author puts forward three simple principles. One, expect failure. Don’t see it as a reason not to try new ideas. Second, make it survivable. Don’t bet the farm.

Take incremental steps in the right scale – not so small as to have no significant impact, but not so big as to cripple the organisation if the result turns out to badly. Lastly, learn how to know you have failed.

Acknowledge it, accept it and examine how you can either rework it so that success is possible, or move on altogether.

It’s a little like learning to sell stocks that have tanked rather than holding on with your head in the sand hoping for a recovery that may never arrive. What needs to change is your investment strategy, not just your portfolio.

In some ways this is a dense book. Harford draws on detailed histories of failure at work, from the prosecution of the Iraq war to the meltdown on Wall Street.

What comes through loud and clear however is that it’s often the people at the coalface that can see what’s going wrong.

Giving them the permission to try something different can be the difference between sticking to the wrong strategy and finding a way out of the hole.

Give them the right to adapt to conditions.

Adapt is an interesting, if not easy, read that uses modern examples to drive home some old-fashioned truths.

3.5 out of 5 stars