Failure overrated, says study led by Northwestern Kellogg professor

Linking failure to success may be not only inaccurate but also damaging to society, according to a paper published last week in the Journal of Experimental Psychology: General. Researchers from Northwestern, Cornell, Yale, and Columbia universities conducted 11 studies involving more than 1,800 participants, and found that people overestimate the rates at which failure begets success. Lauren Eskreis-Winkler, PhD, an assistant professor at Northwestern’s Kellogg School of Management, led the team.

“We’re just trying to understand what holds people back from true resilience,” she tells Fortune. “Business leaders like to talk about failure as fuel. While [this view] could lead you to be a little bit less scared of failure, when failure happens it makes you less likely to take the active steps that bring actual resilience about.”

Failure comes in countless forms, but here Eskreis-Winkler and her colleagues defined it as any event that didn’t achieve a desired goal. They considered success a corrective action that achieved or made progress toward the previously failed goal.

In one part of the study, participants were asked to predict the likelihood of a nurse, lawyer, or teacher passing a licensing exam after having failed. People overestimated success rates in each profession. For instance, they predicted a 58% success rate for lawyers who retook the bar exam, whereas the real-world rate was 35%. Similarly, participants overestimated the percentage of students who retook and passed the General Education Diploma test.

“You could see this whole phenomenon as a strand of optimism bias,” Eskreis-Winkler says, “a tendency to be overly optimistic about lots of things in life including, in this particular instance, the likelihood that we bounce back from failure.” 

Failures in business and in health

The benefits of failure aren’t so much overrated as they are misunderstood, according to Rick Hunt, PhD, director of doctoral studies in management at Virginia Tech’s Pamplin College of Business.

“No matter where you stand on the benefits of failure, you are probably wrong,” Hunt tells Fortune via email. “Nowhere have the benefits of failure been embraced more enthusiastically than in the study and practice of entrepreneurship. Failure is an inevitable facet of the entrepreneurial journey—and is vastly more commonplace than commercial success—so scholars have worked hard to understand the causes and consequences of failure.”

The belief that failure is critical to entrepreneurial growth has become overblown to the point of romanticism, Hunt says, noting that many of the celebrity entrepreneurs who wear failure as a badge of honor didn’t have to risk the roof over their head to launch a business. On the other hand, failure has been destigmatized.

“​​Neither a valorization nor a vilification of failure is accurate or useful, in entrepreneurship or any other human endeavor. The question is where the pain of failure falls versus the benefits of failure,” Hunt says. “In entrepreneurship, the pain typically falls upon individuals, while the benefits are captured by wider society. That is, individuals generate valuable lessons from their failures, but rarely share in the benefits of those lessons.”

Overestimating the benefits of failure could also have devastating health consequences, Eskreis-Winkler’s research found. 

One segment of the study asked participants to gauge the likelihood that someone with an ongoing opioid abuse disorder would enter a treatment program after experiencing an overdose. They predicted 51%, compared to the actual 17% rate. Another group was given the same task but wasn’t told about the overdose “failure.” They estimated a more accurate 33%, leading researchers to conclude that the mention of failure rather than optimism bias is what causes people to overestimate success.

When participants were asked to guess what percentage of heart attack patients implement healthy lifestyle changes, they overestimated once again: 62% compared to the real-world 47%. This translates to participants incorrectly believing that 32,000 heart attack survivors in the U.S. would improve their health, the researchers noted.

“I think it’s that everyone wants to be resilient,” Eskreis-Winkler tells Fortune. “This common message of ‘failure is fuel; it’s a stepping stone to success’ is so well-intentioned. The goal really is to abet resilience.”

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Bouncing back: Inspiration doesn’t equal motivation

Part of the reason why people tend to overestimate others’ bouncebackability is because they also overinflate how much others pay attention to their mistakes, the research found.

“What really gets in the way of resilience is that when people fail, they tune out and they stop paying attention and they disengage,” Eskreis-Winkler says. “It doesn’t matter if you’re disengaging because you’re afraid of failure, or if you’re disengaging because you’re overly optimistic about failure. Really, what you need is a clear-eyed view of the actual likelihood of what’s going to happen in failure’s aftermath.”

Tempering your expectations involves understanding the difference between inspiration and motivation, she says. With graduation season in full swing, for example, you may have recently been inspired by a commencement speech. But when the ceremony was over, did lingering feelings of inspiration actually motivate you to take positive action?

The final leg of Eskreis-Winkler’s research sheds light on the policy implications of correcting misguided perceptions about failure. Participants informed of recidivism statistics were more likely to support taxpayer funding for the rehabilitation of formerly incarcerated people.

“You simply tell people the actual rate at which bouncing back from failure happens. The minute that you correct this overly optimistic view, it’s like people have a sobering wake-up call,” she says. “You realize it’s not as likely to just come about and happen on its own.”

As painful a pill as failure may be to swallow, entrepreneurs in particular should let it ground them, Hunt says.

“The ‘Phoenix Effect’ is a nice idea—and is a quintessentially American, Alger-esque notion—but it rarely ever comes to pass,” Hunt says. “Folks have resources for one, and maybe two shots at getting something right, but then become part of the fertile soil for future efforts by others.”

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