Tennis legend Billie Jean King once said, “For me, losing a tennis match isn’t failure, it’s research.” Amy C. Edmondson, the Novartis Professor of leadership and management at Harvard Business School, shares this quote in her latest book, Right Kind of Wrong: The Science of Failing Well, which won the “Best Business Book of the Year Award” from the Financial Times. The book illustrates how we and our organizations can embrace our human fallibility, learn exactly when failure is our friend, and prevent most of it when it is not. It’s the key to pursuing smart risks and preventing avoidable harm.

At From Day One’s January monthly conference, which focused on making a fresh commitment to a culture of well-being in the workplace, Edmondson shared specific strategies for how organizations can benefit from failure, a skill that is becoming more and more important in today’s business environment. “In turbulent times, failure is even more likely. And in more turbulent times, innovation and problem solving are more important than ever, and they bring the risk of failure.” While it’s easy enough to recognize this intellectually, Edmondson said, “being able to put into practice the truth of those behaviors is something else altogether.”

Good vs. Bad Failure

“A good failure is the undesired result of a thoughtful experiment,” Edmondson said. That experiment, to be considered a “good failure,” should meet four criteria:

1. It’s in genuinely new territory–it really has never been tried before. 
2. It should be as small in scale as possible. 
3. It should be in pursuit of a specific goal, “not just playing around with resources,” Edmondson said.
4. And thanks to some thoughtful research, you should already have a sense that the experiment may work.

A “bad failure,” Edmondson posits, happens when you violate any one of those four criteria. For example, she shared, “You roll out an uncertain product in your entire market, rather than pilot testing it somewhere smaller. So even something that’s potentially good violates the size criterion, and then isn’t so good.”

Simple failures can be forgetting to check a basic safety feature, but there are complex failures as well: “The multi-causal, ‘perfect storm’ kinds of failures that arise when a variety of things come together in just the wrong way, any one of which, on its own, wouldn’t have caused the failure.” The recent debacle with the door plugs on Boeing 737s, she says, is a perfect example.

Pivoting to a Productive Failure

Moderator Adi Ignatius, editor-in-chief at the Harvard Business Review, posited a scenario that many modern business leaders are all too familiar with. “You have a strategy that’s based on a big product rollout that takes years to develop. And then near launch, the CEO decides this is not the right approach, and this massive project with all these people attached to it is suddenly stopped. How do you handle the disappointment? How do you make this a productive failure?” he asked.

Edmondson views this instance as an intelligent failure, suggesting that reframing it as a learning opportunity and acknowledging the effort invested can transform it into a productive experience. “You do it explicitly out in the open. You frame it as a really worthy effort that wasn’t able to achieve what you had hoped it would achieve,” she said.

Some companies even celebrate failures. For example, in the pharmaceutical space, the vast majority of projects fail. It’s just the nature of the scientific experimental process. Eli Lilly, Edmondson says, has parties at the end of failed clinical trials to still celebrate its achievements. This achieves three goals: it satisfies the need for recognition, potentially prevents the same failure from recurring, and it makes the team more likely to end a failing experiment in a timely and cost effective way, knowing that there will still be some sort of positive outcome.

At Takeda they don’t celebrate failure, that’s a bridge too far for their traditional Japanese culture, Edmondson says. But they do celebrate the pivot. “The difference is that the failure is the end, it's looking back, whereas the pivot is looking forward. Same ritual, different language,” she said. “For their culture, they are celebrating the fact that they worked hard.”

Learning From and Admitting to Failure

“Our temptation is very strong to gloss over it. No one wants to dwell on a failure,” Edmondson said. But the formal post-mortem process is important. Rather than placing blame on any one individual or entity, companies should approach it simply, briefly, and effectively: What happened? This is essential especially for multi-dimensional projects with potentially conflicting viewpoints and experiences.

“Rather than a lengthy research project, this should be a quick compiling of the narrative so that we understand it better and resist the temptation to just say, ‘we'll try harder next time’ or ‘it wasn’t our fault, it was bad luck,’” Edmondson said. Organizations should walk away with key learnings as to what went wrong and how to improve on that process in the future.

It can sometimes be challenging for certain individuals to admit to failure. But that’s exactly why it helps to have a ritualized process for acknowledging and addressing it. “If this is what we do around here, they’ll want to play the same sport,” Edmondson said. Organizations should build trust with their employees that there is a safe environment for acknowledging fault. “We are fallible human beings, and we have to be fine with that,” she said. “We are better team members when we are fine with that.”

Building Psychological Safety

How you handle failure as an organization should be a part of an overall strategy for building an environment of psychological safety. “The most important thing is to early and often call attention to the attributes and aspirations of the work that involves unfamiliar territory, stretches, or challenges,” Edmondson said. “We’re sending the intellectual message that ‘we need you, we need your voice and we need you to speak up if we’re to do well on these ambitious goals.’”

Companies should also encourage a culture that welcomes inquiry. “The more facile we get at asking good questions, the kinds that give the other person a clear signal that we really want to hear from them, the more we’re creating psychological safety for speaking up,” Edmondson said. The safer employees feel communicating with leadership teams, the more likely they are to address failures early and often–turning them into opportunities for learning and growth.

Katie Chambers is a freelance writer and award-winning communications executive with a lifelong commitment to supporting artists and advocating for inclusion. Her work has been seen in HuffPost, Honeysuckle Magazine, and several printed essay collections, among others, and she has appeared on Cheddar News, iWomanTV, and CBS New York.