Failure Is Not The End...

...In fact it can be the beginning of success if you react to it correctly. At least that's what Tim Harford would have you believe, author of the book Adapt. Why Success Always Starts With Failure. It is mainly written from an economic point of view and talks about helping the poor, climate change and financial crises. But in the very last chapter, Harford applies it all to you and me. And he basically identifies three possible (and negative) reactions to failure: denial, loss-chasing and hedonic editing. Here's what they each mean in a nutshell:

"While denial is the process of refusing to acknowledge a mistake, and loss-chasing is the process of causing more damage while trying to hastily erase the mistake, hedonic editing is a subtler process of convincing ourselves that the mistake doesn't matter." (p. 254)

Most of us have probably been in denial of a mistake we made and loss-chasing is what Wallstreet traders are in danger of doing when the market starts going against them. But what exactly is hedonic editing? In order to make the idea a little clearer for his readers, Harford gives an example from office life:

"The praise sandwich is a criticism sandwiched between two delicious slices of praise: 'I think this is excellent work. It would be great if you could [important feedback here]. But overall, as I say, it's excellent work.' It's a good way to avoid alienating everyone who works with you, but the criticism sandwiched between praise may be lost in the larger whole. You say, 'It's excellent, but you need to fix...' I hear, 'It is broadly excellent.' I feel better, but I will not become better." (ibid.)

Denial is a problem because we fail to separate our error from our sense of self-worth. Loss-chasing is bad because we compound our losses by trying to compensate for them. And hedonic editing means we remember past mistakes as though they were triumphs or mash together our failures with our successes. So what is the correct way to respond to our mistakes? According to Tim Harford it all starts with a single sentence: I am not a failure - but I have made a mistake. Acknowledging this is the first step on your way to success. The next step would be to adapt, to do something differently than you did it the first time around. And then keep adapting until you succeed. Why keep trying?

"...because the process of correcting the mistakes can be more liberating than the mistakes themselves are crushing, even though at the time we so often feel that the reverse is true. [...] A single experiment that succeeds can transform our lives for the better in a way that a failed experiment will not transform them for the worse - as long as we don't engage in denial or chase our losses." (p. 261f)

In the end it all comes down to knowing that you will be able to deal with failure and not give up because of it. Or as Harford puts it: "The ability to adapt requires this sense of security, an inner confidence that the cost of failure is a cost we will be able to bear."(p. 262)