2024 Winning Essay – Helen C.

100% Scholarship Winner, Helen Chen, judged by Amelia Suda-Gosch, Female Founders

Why Is Learning From Failure Sometimes More Effective Than Learning From Success For Entrepreneurs?

It’s fine to celebrate success but it is more important to heed the lessons of failure,” said Bill Gates. This famous quote, addressed by the renowned entrepreneur Bill Gates, noted the importance of learning from failures since they “could contain the seed of one’s next success.”

Kolb (1984) identifies four stages of learning effectively from failure: concrete experience, reflective observation, abstract conceptualisation, and active experimentation. Effective learning from failure impacts entrepreneurs’ adaptability, decision-making, confidence, and resilience. Failures reinforce the ability to overcome fear and obstacles and provide valuable experience for entrepreneurs to critically evaluate where things went wrong. Additionally, those are beneficial for entrepreneurs to improve decision-making through reflection and analysis of the causes of failures.

In practice, most entrepreneurs fail to achieve success with their first business, and this is due to a lack of commitment or simply misfortune. Bill Gates launched his first business, Traf-o-Data, along with his childhood friend Allen, but unfortunately, it didn’t meet expectations. Traf-O-Data experienced net losses of $3,494 between 1974 and 1980. However, the programme improved] their understanding of microprocessors, eventually leading to their success with Microsoft, even though the business may be considered a failure. From this instance above, it suggests “each failure contains the seeds of one’s next success.”

The story of the failure of Microsoft conveys that learning from failure not only increases confidence in professional skills and performance as a team but also provides the opportunity to learn and grow for entrepreneurs.

This instance indicates that the emotional response to success makes it difficult to learn and improve since it creates a positive sensation and a desire for recognition and self-congratulations. These are not the factors that encourage entrepreneurs to make future attempts and developments, meaning they will lose the chance of greater success.

Failure sets a path for a greater business mindset and eventually leads to success as a result. For that reason, learning from failure is more efficient and effective since success breeds failure by hindering at both individual and organisational levels. Success can make one overconfident in their talents, their choice, and their self-assurance. Furthermore, there will be a tendency not to investigate the causes of good performances and instead to believe in themselves without further consideration of the circumstances and consequences.

In conclusion, failure is inevitable in the course of conducting business; nevertheless, learning from failure is more effective for entrepreneurs under most circumstances and conditions due to the fact that it allows entrepreneurs to learn from mistakes, to refine their ideas and approaches, and to develop new and better solutions.

References

Kolb, D. Experiential Learning. Experience as the Source of Learning and Development, Prentice Hall, Englewood Cliffs. (2018)

Franceasca Gino and Gary P. Pisano, why leaders don’t learn from success (April 2011)

Wolfgang Lattacher, Malgorzata Anna Wdowiak, “Entrepreneurial learning from failure. A systematic review”, International Journal of Entrepreneurial Behaviour & Research, Vol. 26 No.5, pp. 1093-1131 (2020)

Amy C. Edmondson, “Strategies for Learning from Failure (April 2011)

Emre Soyer and Robin M. Hogarth, Don’t Learn the Wrong Lessons from Failure (March 29, 2023)

Pasha Carter, 11 reasons why most entrepreneurs fail (July 5, 2019)

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