Failure is not an option: it comes standard.  Embrace it.

Most managers don’t know that it’s important to hammer that message into their employees, because the word failure has a negative stigma attached.  So let’s pretty it up a bit: call it a mistake.

When an employee makes a mistake, embracing the situation as an opportunity to say: “It’s ok.  This thing that just cost the company $x is being accounted for as an investment.  An investment in your education, for you will learn something important which makes you more valuable to this company and to me.  Now don’t make it again, for while we embrace mistakes as investment opportunities, we shun repeated mistakes of the same kind as a learning deficiency.”

By the way, this attitude has all kinds of happy side-effects:

• Employees are more comfortable experimenting and being creative;
• It reinforces the employee’s notion that they’ve been hired for their good judgement in addition to their skill set (if this is not true, you’re doing it wrong);
• You build a workforce which makes itself more productive as time goes on.

Obviously, there are certain mistakes that don’t make sense to invest in, anything resulting in a weapons charge for example.  That’s just not a smart investment.

Thanks to John Schanz for introducing me to this perspective while working at AOL.

update: post inspired by The Failure-Tolerant Leader over at HBR (subscription required for full article).