The value of failure is practically gospel in innovation-driven industries.
As Elon Musk has famously said, “Failure is an option here. If things are not failing, you are not innovating enough.”
But does failure really lead to more success?
Quantifying and assessing the relationship between the two is difficult. While anecdotes abound about failure preceding success, there hasn’t been much evidence.
To examine the question, UNC Kenan-Flagler researchers studied the role of small failures in the pharmaceutical industry.
Atul Nerkar, professor of strategy and entrepreneurship and Allred Distinguished Scholar, and Isin Guler, associate professor of strategy and entrepreneurship, and PhD graduate Rajat Khanna (PhD ’15), now of Tulane University, share their findings in “Fail Often, Fail Big, and Fail Fast? Learning from Small Failures and R&D Performance in the Pharmaceutical Industry” in the Academy of Management Journal.
The trio chose the drug industry because drug research patents provide a unique, and measurable, window into the role of failure in corporate innovation.
Their work has implications for any industry where innovation is important and outcomes are uncertain.
To read more about the research above click here.