Thomas Edison would be so proud.

The Wizard of Menlo Park once quipped "I have not failed 10,000 times. I have successfully found 10,000 ways that will not work." Edison’s dedication to scientific approach has long been the maxim of the creative class. But even he would be pleasantly surprised at how it is now resonating within the traditionally conservative sphere of American business. Companies like Facebook -- which encourages employees to “move fast and break things” -- and Pixar -- which tells workers to “fail early and often” -- are examples of successful American companies finding that the best way to succeed is to fail, and fail repeatedly.

The people who rise to lead prominent American companies are normally already familiar with falling short, even if they would prefer not to admit it. According to John Maxwell’s Failing Forward, the average entrepreneur fails 3.8 times before he or she finally makes it in business. For the proof, you only need to look as far as the United States Patent Bureau, which registers hundreds of thousands of patent applications every single year -- nearly all of which you’ll never hear about, let alone pay to acquire or use. 

Intellectual churn is a requisite for businesses who want to succeed amidst incredible competition, according to Ryan Babineaux, co-author of Fail Fast, Fail Often: How Losing Can Help You Win. “If you look at successful entrepreneurs and executives, they are very good at executing small actions quickly,” regardless of whether they work or not, Babineaux explains.

The Scaling of Experimentation

But even if failing is conducive to success, some businesses are reticent to welcome it. Simply put, established businesses need the flexibility to experiment with new projects without damaging the reputation of their core products. With that in mind, many companies are turning to “skunk works” – idea labs that allow employees to inject focused creativity into the development process without affecting the bottom line. The most fabled skunk works of the 20th century was operated by Lockheed Martin. Charged with engineering Lockheed’s most advanced (and often most secretive) projects—including the U-2 spy plane and the F-22 Raptor supersonic stealth fighter, among others—this legendary division operated under the alias Skunk Works, a name taken from a popular comic strip in the 1940s. Today, the skunk works that everyone talks about is Google X, with its self-driving cars and optical nanotechnology. 

Where does that leave companies in non-technological markets like retail, clothing, and office supplies? These companies are investing in an alternative to “traditional” research and development: A company-wide culture that supports failure, anchored by the belief that failure is not only acceptable—it’s necessary to create great things.

Schools: The Labs of Failure

As companies increasingly warm to the concept of encouraging experimentation, they will need employees who aren’t afraid to fail. Design schools across the country are cultivating this next generation of Edisons.

“If we could think of failing as a path towards success, then I think we would all be better off,” said John Krumboltz, the second co-author of Fail Fast, Fail Often: How Losing Can Help You Win, and a Professor of Education and Psychology at Stanford University.

Consider d.school, the Institute of Design founded in part by “design method” rock star David M. Kelley and located down the street from Krumboltz’s Stanford office. Chris Flink, a consulting associate professor at d.school, summarizes its teaching philosophy as a “demand that student teams keep pushing the limits of possibility until they face-plant.” The popularity of this intense learning method is growing (despite its relative vagueness). According to the Wall Street Journal, the attractiveness of design school’s commitment to failure is helping d-school enrollment rates outpace more traditional business schools.

The longevity of this trend will depend in part on positive reinforcement from hiring managers. Companies will need to convince prospective employees that they’re serious about supporting failure—not simply giving lip service to the concept.

Why The Rebound Matters

Eventually, companies that are on the brink of success need to prove to potential investors that they can successfully rebound after failure. Venture capitalists often learn far more about a company from its failures -- the “test of character,” as Richard Branson calls it -- than its successes. 

But finding success through failure is hardly limited to companies with billions of dollars in capital at their disposal. Any businesses can learn from what Krumboltz called the “small failures that we should be encouraging.”

“We’re in a marketplace now where you have to be very fast, and you need to be able to adapt very quickly,” said Babineaux. “If you’re in this old model of ‘we’re going to come up with an idea, and five years later we’re finally going to come out with our product and that’s finally where we’re going to see if it’s a good idea or not,’ you’re never going to make it in this economy.”