Turning Failure to Your Advantage

In 1991 I, along with my business partner, suffered a financial meltdown. We had built a successful publishing company, but our growth outstripped our working capital. We simply ran out of cash.

Exhausted Businessman

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For a while our distributor funded us in the form of cash advances on our sales. But eventually, their parent company wanted those advances back. Although we didn’t officially go bankrupt, the distributor essentially foreclosed on us and took over all our assets.

This was a difficult time personally. I was confused, frustrated, and very angry. Initially, I blamed the distributor. If they had only sold more, as they had promised us, none of this would have happened, I thought. It’s their fault.

But eventually I looked in the mirror and had to acknowledge that I could not move on until I learned from this experience. Though incredibly difficult and humbling, I am now thankful for this period in my life. I learned some critical, life-changing lessons. I am convinced that I would not be where I am today if I had not had this failure.

But not every failure ends so well. Sometimes, people suffer a setback and never recover. I don’t think it has to be this way. It is all in how you process it. I am convinced, that if you are going to succeed, you must learn to deal powerfully with failure.

I think there are at least six components to turning failure to your advantage:

  1. Acknowledge the failure. This is where it begins. To my knowledge, I have never fired anyone for failing per se. Failure is natural if you are striving to deliver big results. The problem comes when you fail and then refuse to acknowledge it.

    Several years ago, I had an employee who was floundering. He wasn’t delivering the results we expected. That was certainly a problem, but it wasn’t the primary problem. The problem was that he refused to acknowledge that he had a problem. He kept defending himself. In doing so, he only convinced us that he didn’t “get it.” As a result, we had no choice but to let him go.

    Once you acknowledge failure, you take away it’s power. You can then begin to turn it into something positive.

  2. Take full responsibility. You won’t get anywhere as long as you blame others for your failure. As long as the responsibility is external—outside of you—you are a victim. Why? Because you can’t control others. You can only control yourself.

    But when you take responsibility for the failure and become fully accountable for it, you take back control. Suddenly you realize that you could have done things differently. You open the door to possibility—and to creating a different outcome in the future. But this can only happen when you acknowledge the failure and own it.

  3. Mourn the failure. I am not simply exhorting you to have a positive attitude. Failure stings. It hurts—sometimes deeply. Many times there are very real and serious losses. Often times there is collateral damage. Other people are hurt. Sometimes innocent people.

    It’s okay to feel sad about these things. Sometimes it takes a while to recover. When I had my financial setback in the early 90s, I mourned for weeks. It couldn’t be rushed. In fact, I think the reason I was able to bounce back relatively quickly was because I mourned the loss so deeply. I dealt with it thoroughly and got it behind me.

  4. Learn from the experience. Even failure can be redemptive if you learn something from it. It doesn’t have to be career-ending. In fact, it can be career-building—if you take the time to wring all the juice out of the lemon.

    Honestly, there are just some things you can’t learn—or won’t learn—without failing. I wish it were different. But pain is a powerful teacher. Like Friedrich Nietzsche, the 19th century German philosopher, once said, “That which does not kill us makes us stronger.” So true.

    But it only makes us stronger if we thoroughly process the experience and determine what we could have done differently and will do differently next time around.

    As Ilene Muething of Gap International has taught me, it is helpful to ask “What was missing?” rather than “What went wrong?” The latter shuts down possibility and often results in blaming. The former opens up possibility and results in learning.

  5. Change your behavior. George Santayana, another philosopher, said, “Those who cannot learn from history are destined to repeat it.” And we really haven’t learned anything until it affects our behavior.

    If we keep doing the same things that led to the failure, we are destined to get more failure. We have to be willing to change. And it really does start with us. This is the one thing we have control over.

  6. Enter whole-heartedly into the next project. You can’t allow failure to hold you back from the next venture. If you fall off the horse or a bicycle, you have to get back on—immediately.

    If you don’t do this, the failure gets magnified in your mind. Wait long enough and you might never get on at all! Instead, you have to put the past behind you and move forward.

Again, failure is inevitable if you are going to tackle significant goals. You have to learn to make it work for you. In doing so, you are planting the seeds of your eventual success.

Question: What failure do you need to turn to your advantage? You can leave a comment by clicking here.
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  • http://www.jeffrandleman.com Jeff Randleman

    Failure.  I seem to have a lot of those racked up in my life.  But I guess that’s because I try a lot of new things.  Sometimes they work, sometimes they don’t.  Thanks for the information on how to deal with this. 

  • Steve Morgan

    yes, these are all good practical ideas.  Easy to blame others or be the victim.  We can’t fall into a learned helplessness.  It wasn’t until the step of realizing I was the problem that things began to change.

  • http://www.dwaynes--world.blogspot.com Dwayne Morris

    I’ve heard it said, “If you want to impress people, tell them about your successes. But if you want to influence them, tell them about your failures.” Thanks for being transparent!

    • http://michaelhyatt.com Michael Hyatt

      That is a very wise saying. I have certainly found it to be true.

    • http://uma-maheswaran.blogspot.com/ Uma Maheswaran S

      Thanks for the quote. That was insightful.

  • Joe Lalonde

    Great lessons and advice Michael. I know I can fall into the trap of number 2 and blame others for my failings. I’m working on getting better at that.

  • Brian Stewart

    “What was missing?” is a GREAT way to phrase the question. Thanks for passing along that tip.

    • Anonymous

      That was my biggest takeaway of this article as well

  • http://ericspeir.com/ Eric

    Thanks for sharing your story. It’s easy to look at highly successful people and they think they’ve had it easy and have always had everything together. (I know this is not true!) I love the questions that you used in the end. I will keep those in mind. I would also say that processing the event is the best way to learn from it. It allows you to take an objective view of things and learn from it.

  • http://twitter.com/rkinnick59 Randy Kinnick

    Words of wisdom, Michael.  We learn so much through the struggles of failure…if we allow ourselves to.  Your words bring this home very impactfully…

    “Honestly, there are just some things you can’t learn—or won’t
    learn—without failing. I wish it were different. But pain is a powerful
    teacher. Like Friedrich Nietzsche, the 19th century German philosopher,
    once said, “That which does not kill us makes us stronger.” So true.”

    Even in the realm of our losses…regardless of the form they take, we can learn and use them for good.  I wrote a post today about that very thing…

    http://www.randykinnick.com/healing-the-wounded-heart-dealing-with-the-inevitable-experience-of-loss/

  • http://www.tnealtarver.wordpress.com TNeal

    Ah, we revisit failure for a second time this week. Today I’ve failed at keeping boundaries around my schedule, a typical lesson that reincarnates itself (or resurrects, if you want to speak Christian) on a weekly basis. Your advice, “Change Your Behavior, and the Santayana quote are spot on for me. I need to change a number of things to return to a productive writing schedule.

  • Rogmaozamiz

    Hi Sir Hyatt,

    Thank you very much for this article.

    mir

  • PV Lundqvist

    When I first started my own business, I was steeped in the myth that businesses failed for Darwinian reasons.

    Rubbish.

    It’s all about receivables. Plenty of great businesses fail because they can’t get their customers to pay up fast enough. Even the best swimmer has to breathe once and a while. And having good paying customers can be just plain luck.

    Once I accepted that, I became less cocky about my success. And acknowledged, to myself, that as hard as I worked, as skillful as I may be, that a trick of circumstance can undo it all.

    Thanks for the post.

    • http://uma-maheswaran.blogspot.com/ Uma Maheswaran S

      became less cocky about my success– Many times experience teaches this great lesson.

  • Ben Berson

    amazing article! failure is not a person; it is an event!
    I was able to turn a corner using your article! thanks so much!

  • Eccle0412

    Not going to present the details but have lived the process. Fairly quickly I was able to see what seemed like failure was what it took to move me to next and was exponentially positive far beyond me.  When character is certain, failure is a building block that leads to a stronger platform. 
    On another note;  Thank you for your leadership here.  Since “following” and learning from you for the past maybe 6 months I have gained amazing employment and use so much of what I have learned (and read in many books you presented and gave me).  Starting my “love is the Killer App” book shelf in my office so that I can share knowledge. My team is better because of you!  And I love the opportunity I have to watch people grow.  
    As John Y stated below, you have no idea how you are impacting through your experiences shared.
    In my life that translates to God’s greatness and my ordinary-ness.
    “Pray like no one’s listening; serve like no one’s watching; and give like no one’s counting. Be God’s best kept secret.

    • http://michaelhyatt.com Michael Hyatt

      Thanks for your kind words.

  • Francarona

    Michael, I truly believe that here are hidden gifts in our setbacks.  The secret is to discover the gifts and accept them.  Only then can you change your life.  Thanks for all the great posts!

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  • Tracy Krauss

    Such great advice. Often times, people forget the ‘mourn the failure’ part. We are supposed to just ‘buck up and get over it’. Mourning our losses is an important step to moving forward, no matter what the scenario. 

    • http://uma-maheswaran.blogspot.com/ Uma Maheswaran S

      Even the Bible stress about mourning in several places.

    • http://uma-maheswaran.blogspot.com/ Uma Maheswaran S

      Mouring helps us to reconcile ad regain our balance.

  • Jnicolewilliamson

    great post on taking personal responsibility in times of failure, learning from it and moving forward.

  • http://uma-maheswaran.blogspot.com/ Uma Maheswaran S

    Turning failure to our advantage requires acumen and courage from our end. Many times, we don’t feel like bouncing back. I am reminded of the saying “Success is the ability to go from one failure to another with no loss of enthusiasm” by Winston Churchill.  However, it’s important to learn from our failures and improve subsequently.

  • Henryhofc

    I once owned an IT business with 20 employees. I was too cheap to get a valuation and end you selling 51% to my brother way under value. Later we had a fall out and I lost both a profitable business and a brother. A very foolish decision I hope to never make again. Now I own a successful financial advisory business.

  • Henryhofc

    One more – at the depths of my loss in 2005, I told God, “the Lord gives and He takes away, blessed be His name.” the thought entered me that one day I will look back and the loss will look small in comparison to what He can provide, Lord willing. He did.

  • http://www.facebook.com/people/Minette-Ellis/100000653615846 Minette Ellis

    Failure is a stepping stone to Success

  • http://www.inspirationtochange.org Karen Zeigler

    I had longed to write for almost 20 years and it wasn’t until I failed at the job I had settled for after college that I wrote my first book.  In fact it was the process of failing that created the topic of the book.  I would have probably never written on the topic of worry in my life – I have so many other things I am passionate about.  But it was what God taught me through that failing process that ended up being the topic for the book.  Amazing the irony of God sometimes.  Sometimes it’s hitting the bottom (failure) that causes us to stop, listen to God, listen to our intuition and move forward in the right direction.

  • http://www.cmoe.com/leadership-development.htm Susan

    People also need to keep in mind that failure shouldn’t scare them away from making big changes or decisions. Having failed doesn’t mean you should shy away from anything different, just that you need to consider everything carefully before taking a huge leap.

  • http://twitter.com/ConnieMcKnight Connie McKnight

    Michael,
    I loved the lessons you learned from your failure. Each point is a journey into itself. If we don’t acknowledge and take responsibility, we’re bound to repeat the same mistakes again. Failure is not easy, but I’ve learned my most valuable lessons from failure.

    I think entering into the next project whole-heartedly really shows what you’re made of.

    Connie

  • Frank Jackson

    This is great advice. I appreciate you and your insightful postings. I have just experienced failure, and you are correct, it stings. I have been taught to absorb it and so I shall. I am still mourning the failure at this time…I was told today that I failed. I will grow from this. My God still loves me, my wife still adores me, and my CEO still has the confidence to assign me another huge task/project that I will use my strengths to make successful. Overall, I’m happy and still on the team. I’m just sitting the bench for a few games. God Bless You Michael Hyatt for this uplifting, inspiring post.

    • http://michaelhyatt.com Michael Hyatt

      You are welcome, Frank. Glad I could help.

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  • Joy

    Thank you…thank you. Failed 2 years ago in my small  business, haven’t recovered yet but I have started taking steps to make things better but one thing I didn’t do was take full responsibility…now I have and its like a big load off my chest… people where hurt and I agonize over it daily, but I can’t keep living in the past…now I ask myself, what did ‘I’ miss?! How can I do it better?! Michael Hyatt your blog post are like road signs on the journey am taking. I just want to say thank you.

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  • Breaking_thechain

    Now I’d like to hear what you say about those who are relentlessly hounded by the security dogs of our day that supposedly is there for our security when you were kept from falling morally by the mercy of God but your employer trailed a trail for the next employer to make mincemeat out of you and had it not been for the almighty himself you would have gone down. He did not allow it  praise His holy name. But the employers + security contract hire of the companies are making sure to advance info forward to all employers afterwards even though illegally done with no fear of repercussions. Only sure harassment to where one of the employers the head of the company said “Wouldn’t want you to have a breakdown” as He smiled.

  • Plugger34

    I have struggled with work since the day I stepped out of college.  I work hard, try my best, but have found time after time to be incompetent.  I’ve gotten up from a failed job, put my best foot forward again, and failed again at the next job.  I’ve read every self-help career book and work in a career I love, but I cannot perform.  I’ve prayed to God and had my prayers fall on deaf ears.  After struggling in dead end jobs and an under performing start up, I finally landed a job with a great company at age 37.  I thought I finally had a job that would allow me to fulfill my dreams of home ownership and consider marriage.  After 3 weeks of trying everything to perform well, I was fired for poor performance.  As I now struggle to find a job earning less money than I could earn 15 years ago coming out of college, my advice is simple.  Some people on this Earth are made to fail.  Don’t fight God’s plan.  Tuck a gun barrel under your chin and pull the trigger.

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  • JOSEPH GOCO

    Barry this is what i was looking for to boost my research prior to speaking to teens  this weekend on topic, ‘turning your disadvantage to advantage’. God bless you for your work to teens and youth. JOSEPH, NAKURU-KENYA

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  • Jammerings

    I am currently in the death spiral of financial failure. I know it is all my fault but my road to destruction was paved with good intentions. Six years ago, my son was born with special needs. As any dad would, I have been trying to make things perfect. I have switched jobs a million times it seems to find right balance of pay and freedom. I have invested heavily in courses that, if followed, provided the possibility of a better life. Instead of prosperity, I find myself in a position where I have let everyone down, and not a great place to be a week from Christmas. I am utterly humiliated and devastated. I feel all the same emotions such as anger, frustration, embarrassment and feel defeated. The post showed me I am not alone but I find little comfort in this.

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