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Grow or Die #7: Why Failure and Flow Are Essential for Growth

As founders, we know the importance of finding that "just right" level of challenge for ourselves and our teams. If we’re knocking all our goals out of the park with a 100% success rate, we’re likely playing a game that’s too easy for us. Conversely, if we’re constantly meeting with failure, we’re likely to lose interest or give up. But when we’re engaged in work that requires us to push ourselves to the limit to achieve something great — that’s when we find that “in the Zone” Flow state that keeps our teams focused, aligned, and thriving.

Research suggests that learning progresses most quickly when there’s a failure rate of around 15%. That means failure is part of the equation of growth: Some degree of failure is essential for Flow, and Flow is essential for growth. If your organization is not failing around 15% of the time (not hitting one of your Rocks or goals), you’re probably not applying the optimal amount of tension.

As I’ve written about previously in my Grow or Die series, the adage that companies either grow or die is true for every organization. Your company needs to achieve a certain level of growth over the long run to attract and retain your Ideal Stakeholders. The exact growth rate depends on your industry and Stage of Development. In this blog, I'll share two of my favorite “in the Zone” frameworks to help you achieve that just-right level of challenge: Flow and the Yerkes-Dodson Law.

Baseball: A Metaphor for Levels of Competition

Let’s take Mike Trout, a future Hall of Famer and one of baseball’s greatest hitters, and demote him back to Little League…

Trout would undoubtedly dominate, hitting almost every pitch with ease. His batting average would probably exceed 900. Would he be happy? Would he deem his life/career to be successful? No.

Trout would likely hate competing at this level. It’s more than obvious that batting 950 and being voted MVP would provide him with zero value. More than likely, he’d also be super embarrassed because he took these opportunities and awards from some kids who genuinely deserved them.

True success is relative. True success, as personal development expert and radio personality Earl Nightingale defined it, is “the progressive attainment of a worthy goal.” For a top-level athlete like Trout, true success comes from competing against the best professional pitchers, facing challenges that push his abilities and occasionally result in failure.

In the 90s, Michael Jordan discussed the concept of failure in a Nike commercial, and I’ve been sharing the video with my colleagues and clients ever since: 


Flow: The State of Optimal Experience

Psychologist Mihaly Csikszentmihalyi’s concept of “Flow” is instrumental in understanding the relationship between challenge and growth. Flow is the state in which a person is fully immersed in an activity, experiencing a balance between their skill level and the challenge at hand.

During Flow (see Figure 1), a person experiences deep concentration on the present moment and the task at hand as well as a clear sense of purpose and direction. You know what this immersion, or Flow, feels like — it’s those times when you’re so fully engaged that the rest of the world fades away into the background. Action and awareness merge seamlessly, andA rectangle is broke up into 8 triangular sections. The horizontal axis is labeled skill level, and the vertical axis is labeled challenge level. you feel "one" with the activity, losing that sense of self-consciousness that so often holds us back with doubts, external concerns, and distractions. You not only feel completely confident in your abilities and skills to meet the demands of the task but you find the activity itself intrinsically rewarding and deeply satisfying.

What’s more, people who enter a Flow state often make connections and insights that they might not otherwise, allowing them to come up with innovative solutions to complex problems. Imagine what would happen if everyone on your team found Flow in the work you’re doing together. Not only would it lead to growth at the personal level but at the team and organizational level, too. Your culture would be strengthened as people did work they genuinely felt matters, that they found enjoyment and fulfillment in every day.

So, how can you and your team get in the Zone? True Flow, where growth and peak performance occur, happens when there’s a slight mismatch — enough challenge to push the individual but not so much as to cause discouragement. If the challenge is too easy, as with Trout in Little League, the person becomes bored. If it’s too difficult, they become anxious. Identifying where a player is developmentally and putting them into the Zone is the job of every coach who fundamentally cares not just about the player in front of them but the potential of the player inside the player. As I like to say:

“I get that this may sound a bit harsh but…
I care more about the future you than about the person in front of me.”

As leaders, we want to find the “just right” level of challenge for each of our team members: not too much or too little. Challenge your teams too little and people will leave due to boredom or disinterest, but challenge them too much and people will become stressed out and anxious. They’ll either leave or become less and less productive. Your job as a leader is to create an environment that enables your team members to be appropriately challenged and fully immersed in their Work.

The Yerkes-Dodson Law: The Optimal Stress Zone

The Yerkes-Dodson Law complements the idea of Flow by illustrating the relationship between stress (or arousal) and performance (see Figure 2). According to this law, performance improves with increased arousal but only up to a point. Beyond this optimal stress zone, performance declines.

A bell curve plotted on a plane is titled Yerkes-Dodson Law. The x-axis is labeled Arousal, and the y-axis is labeled Performance.Experiencing failure occasionally ensures that one remains within this optimal zone, learning and improving without becoming overwhelmed or complacent.

We can plot the potential stress of our work on a graph and measure it against anticipated performance. The resulting bell-curve distribution shows that finding the right amount of tension, stress, or pressure (called arousal) will yield optimal performance. With low stress, performance tends to be low because attention and interest are low. But if stress is too high, performance is impaired. Somewhere in the middle, between these two states, there’s a point at which we reach an optimal level of both stress and performance. This is the point where people experience Flow.

Unlike Flow, Yerkes-Dodson is also about the team. We can take the same big idea and now talk about the New York Yankees joining the San Mateo, California Little League. If you put your team through too much stress, players will burn out and the best will simply leave. The goal of a great coach/leader is to find the zone of optimal stress for performance — to identify the level of the game being played and coach accordingly.

If you're an early-stage business, you're playing at one level and the game should be clear, straightforward, and appropriately simple. As the team gets better, decide when it’s time to push to the next level to get promoted to the next league.

Levers of Ambition

There’s one other major part associated with playing in the Zone, and that’s recognizing and appreciating that there are various levels of ambition. Whether you're an ambitious founder or a team leader or even a new player, it’s super helpful to recognize that the world of business is without question a team sport. The reality is, if your organization is highly ambitious, you need highly ambitious players. Big leaguers don’t like to play with or against little leaguers (acts of charity aside). 

Understanding an individual’s, team’s, and/or company’s level of ambition is also critical in determining the appropriate challenges and support they need. Ambition drives people to seek out tougher challenges and higher levels of accountability, responsibility, and authority. However, it’s essential to align their ambition with the right level of difficulty to ensure they remain engaged and motivated — that is, in the Zone — without becoming overwhelmed.

If you want to play Sunday pickup games, go find people who want to play at the same level. If you want to go to the Olympics, hang out with people who have been there or also want to go there. The vibe is completely different. What matters is completely different. The level of intensity is completely different. Even the post-game is completely different.

High achievers, much like top athletes, thrive when faced with challenges that are just beyond their current abilities, pushing them to grow. High achievers are driven by a need to move up and up and up in terms of the level of challenge and, likewise, competition. High achievers love being surrounded by high achievers. High achievers love competing against high achievers.

Identifying and nurturing ambition within an organization can lead to a culture where employees are continuously striving for excellence and are not just resilient in the face of failure but get that it’s a core part of the game being played.

Challenge and Stratum Levels within an Organization

This concept of facing appropriate challenges and experiencing failure is equally relevant within the hierarchy of an organization. Each higher layer, or Stratum, within an organization represents a step up in terms of the degrees of difficulty associated with the level of play. As employees move up through the organizational Strata, they encounter more complex problems and objectives, greater accountability and responsibilities, more authority, and higher expectations (which in the best of the best organizations, need to be turned into agreements).

At each Stratum, the balance between skill and challenge must be maintained to foster growth, achieve optimal performance, and ensure people are consistently playing in the Zone. Just as athletes advance through levels of competition, employees must face new challenges that push their limits. Allowing room for failure is essential for individual, team, and departmental development and organizational innovation.

Leaders within organizations should recognize that promoting or advancing employees without providing sufficient challenges or support can lead to disengagement or burnout. Conversely, creating an environment where failure is seen as a natural part of the growth process encourages employees to take risks, innovate, and ultimately perform at their best.

Playing in the Zone

Great players, leaders, teams, and companies are focused on consistently playing in the Zone. Playing in the Zone means finding the right balance of challenge and stress. It means being fully aware of the nature of the game being played, the nature of the players on the field, and the mindset of the coaches. It means recognizing that it’s impossible to not respect the simple idea that things either grow or die.

For ambitious founders and anyone who does or aspires to lead and coach, the metaphor of playing in the right league and attracting, coaching, and retaining the right players is crucial. Your job is to help individuals, teams, departments, and your entire organization compete at a level that matches their abilities and their level of ambition. Just as neither Trout’s nor the Yankees' successes in Little League would be meaningful, you need to make sure your people, your teams, your departments, and your entire organization are not just playing in the right league but consistently playing in their Zones.

Finding Your Zone of Optimal Growth

You and your Senior Leadership Team must agree on a growth rate. At Ninety, we have a very clear (and potentially obnoxiously repeated) growth range target that guides everything we do and how it translates into our revenue and profit goals three years from now. You’ll also want to define up to three key performance indicators (KPIs) needed to achieve these financial performance goals. KPIs may be units sold, customers served, net promoter score, contracts completed, or other progress markers.

You want to commit to targets that will challenge your organization and keep your teams engaged. Be thoughtful about allocating scarce resources like time and capital. In my experience as a company builder, coach, and investor, being overly conservative is just as dangerous as being excessively aggressive (yet another topic for another day). We hire and invest as we grow because over-hiring or over-investing is just as dangerous as under-hiring or under-investing.

Failure is not just a possibility but a necessity for growth and true success. By embracing frameworks like Flow and the Yerkes-Dodson Law, we can understand that failure, when managed correctly, keeps us within the optimal zone for performance. Like athletes advancing through various levels of competition, we need to embrace challenges and occasional failures to achieve progressive and meaningful success. The key is not to avoid failure but to learn and grow from it.

If you’re an ambitious founder, creating an environment where team members can thrive is crucial. This involves setting realistic yet challenging goals, maintaining open lines of communication to monitor stress levels, and fostering a culture that values work-life harmony. By doing so, we can ensure that our organizations are not only growing but also remain resilient and humane, with team members who are focused, aligned, and thriving. We’re creating and sustaining workplaces where work doesn’t suck.

Are we as individuals here, are our teams here, is the company here, to grow… or die? I think that’s not just a great question but one that needs to be asked at least every 90 days. 

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