Why entrepreneurs do not learn from their mistakes?

There is a widespread belief that successful entrepreneurs achieved their success because they failed first. Entrepreneurs are often asked to "fail quickly" to learn the valuable lessons that will help them in their future projects.

In his report published by the American Wall Street Journal, author Francis Green said this belief is far from true, as businessmen do not learn from their mistakes, but if they fail once, they are more likely to fail again.

The writer added that the main reason behind the recurrence of the error is related to psychology. Indeed, the learning process is complex, not the simplicity and clarity we hope for.

It is difficult to draw lessons from mistakes and then apply them to new situations. Moreover, we tend to simplify our experiences and go beyond the main details that would help us get a complete picture of why things happened, says the author.

Hard lessons
After working with thousands of entrepreneurs and startups, the author concluded that there is little evidence to confirm that failure helps people succeed. Often, the evidence circulated consists of selected stories of famous failed entrepreneurs.

Studies do not show that failed entrepreneurs are more successful. To test the topic, the author studied 8,400 German startups to see if new companies launched by failed entrepreneurs performed better than the first ones. The result was that they did not achieve the expected success. In fact, their results were poor the second time.

The writer stated that the failed businessmen were more likely to go bankrupt or close their business than businessmen for the first time.

"In fact, even if a businessman has successfully run a business before, he will likely see the failure of his new business, like a businessman, for the first time."

A study of German entrepreneurs also found that the performance of entrepreneurs who launched a company after their failure was poor compared to the other founders.

Practice
The writer stated that businessmen do not learn from their mistakes because learning is difficult in the context of starting operations, and most of the time, when we think about learning, we think about gaining experience through regular practice.

In his book entitled "Exceptional", for example, Malcolm Gladwell said that professional chess requires about ten thousand hours of practice. But part of the reason why the training is so effective is that chess is well-known and regulated, and the same is true for football.

However, these regularities do not occur in the cases of the start of a new project. The markets are evolving, customers are volatile and the number of liabilities is different. Therefore, you have to learn what it takes to become the equivalent of a chess expert by dealing with the ever-changing rules and opponents, which makes it more difficult to interpret previous procedures and experiences successfully.

The writer mentioned that the process of trying to understand the customers desire reveals the current needs of customers. But often times, customers find themselves not understanding what they really need, or may not be able to accurately articulate this need. They may tell you things that can send you in the wrong direction.

The writer added that a businessman talks to customers and launches a failed product because he has not found an audience, he believes that he can try again by analyzing what he did not succeed in it last time.

In contrast, the problem is that even if the businessman can deal with the defect by looking at the faulty information that led to the defect in the first place, this understanding does not reflect the customer’s current needs, which are likely to change since the last time, based on many Factors.

As a result, the project begins on an incorrect basis, as the second attempt to start the project will not face the context of the first attempt itself. It is possible that there will be different circumstances, prices and relationships with the market.

Moreover, most project cancellations do not happen quickly, as the project owner procrastinates so that he has no choice but to close it. On the other hand, this makes it difficult to know the true cause of failure.

The author explains that if a small business loses a major customer, it can compensate it for another, but this initial loss has made the company too weak to handle a number of future problems. However, the work continues for a few years until the owner sinks and the owner surrenders.

Learning and coordination
The writer pointed out that there are a series of obstacles to learning that relate to the way we think. The start of a business involves coordinating complex and interconnected activities such as marketing, logistics, financial planning, sales and operations.

But we all - the author says - tend to simplify things for ourselves, and this tendency to simplify is often combined with common human weakness, blaming external events, rather than attributing these results to his own actions.

For example, entrepreneurs usually blame the bank for causing their financial failure but are not considering their role in causing it, such as failing to anticipate high overheads.

Study of project failure
The writer advised businessmen who want to succeed in their second project to follow the strategy of "studying the failure rate of the project", as it forces entrepreneurs to know the options available to them.

In addition, they should ask themselves whether they have the necessary expertise in the industry.

Studies also show that knowledgeable and experienced entrepreneurs perform much better than entrepreneurs with little or no background in the field.

The writer said that the role of investors is to encourage entrepreneurs who do not have any experience in the field to return later when they have the required experience, and to hire consultants or team members with these qualifications or to advise the project owner to convert his idea into a better industry.