Why Hypotheses Beat Goals

Not long ago, it became fashionable to embrace failure as a sign of a company’s willingness to take risks. This trend lost favor as executives recognized that what they wanted was learning, not necessarily failure. Instead, companies should focus organizational energy on hypothesis generation and testing. Hypotheses force individuals to articulate in advance why they believe a given course of action will succeed. A failure then exposes an incorrect hypothesis—which can more reliably convert into organizational learning.