How To Lose Like A Winner – Forbes

YANQING, CHINA – FEBRUARY 07: Mikaela Shiffrin of Team United States falls during the Women’s Giant … [+] Slalom on day three of the Beijing 2022 Winter Olympic Games at National Alpine Ski Centre on February 07, 2022 in Yanqing, China. (Photo by Tom Pennington/Getty Images)
Whether it’s in sports, business or the military, there are going to be times when we fail. Everyone at some point will have to go into a situation less prepared than they would like or against an opponent—whether it’s a football team or another company—that has an edge. Even the best athletes in the world lose sometimes. Want proof? Look no further than the recently concluded Winter Olympics in Beijing where superstar skier Mikaela Shiffrin was the favorite to medal in multiple events. She already had three medals to her name, and she was heavily promoted in the lead up to the games. Instead of winning gold, however, she was disqualified twice and didn’t bring home a medal in any of her six events.
A singular failure creates stress and distraction, making additional falls more likely. As cognitive scientist and Barnard College President Sian Beilock noted recently in writing about Shiffrin for The New York Times, “When our brain is processing complex emotions and stressors, it hinders our ability to function at our best.” We’ve all experienced this. We all stumble sometimes, and it’s very easy to get in your head after a fall, dwell on what went wrong, look for excuses, or start to doubt yourself. Beilock also notes that all people are inclined to “recency bias,” meaning they are more likely to focus on recent failures and “prioritize our most recent experiences over past ones.” In other words, we can get trapped in a cycle when we stumble.
Yet, because she’s an elite athlete, Shiffrin continued to try to adjust her technique despite the failures; she didn’t win gold, but she didn’t drop out of the games either. That’s admirable and speaks to incredible grit. It also represents a path forward.
The most successful people learn from their losses. Great managers and coaches help their teams work through failures and come out better on the other side. In Shiffrin’s case, if she gets the learning right, she still has lots of competitive years ahead of her.
It seems obvious, but it’s worth saying: People tend to be good at winning when they are winning. When a company beats quarterly earnings expectations, everyone is happy. There’s even a risk that success can make us a little bit too egotistical and, paradoxically, not as good as we would be otherwise. Success also isn’t an accurate test of how a team or an executive handles stress, challenges and inevitable loss, whether that’s caused by a predictable market downturn, a mistake, or an unforeseen event.
So what happens when we inevitably lose? Some people can’t escape that cycle, and others get through it. What do the people who thrive after a loss do differently?
Anytime you lose, there are two key questions that you have to ask:

If your analysis tells you that you really did the best you could have done, then that’s something to feel good about, even though you fell short. There are times when the other team has an exceptional wide receiver or an incumbent player controls more market share, but you still delivered the best you could under the circumstances. Yet even in these cases, it’s important to understand why you didn’t succeed.
Study the causes of the failure, not because you should dwell on them, but because you can learn from them. (Incidentally, analyzing a win is just as important as analyzing a loss. If a football team wins a game against a weak opponent despite not doing a good job on third and one and handling the goal line poorly, those problems will become acute later on against stronger teams.)
Once you know why you didn’t succeed, then you can focus on how to fix it. Even if you aren’t able to resolve the problem immediately, that understanding of why you failed will become a roadmap for improvement. Rather than focusing on the loss itself, to the exclusion of future opportunities, it becomes possible to focus on the lesson drawn from it. If we understand why we lost—exactly what the problem was—and we know what the cause of that problem is, then it becomes possible to improve on our performance in the future.
Here’s an example from my time at Merrill Lynch: I had just been put in charge of the municipal bonds business in the 1990s, and for the first time I was running the trading desk. At first, they weren’t taking a lot of risks, which meant that they rarely lost. They also rarely won. So, we tried a new sort of trade—with what we thought was a hedge against losses. It also happened to be a day when I was out of the office at my daughter’s last basketball game. It was snowing on the way back to the city, and I got a call from work that our experiment was a total failure.
The munis went the wrong way, the hedge didn’t work at all, and the desk got pummeled, losing $27 million in two days. I was new to the job, the desk was my responsibility, and the loss really put me in the hot seat. Afterwards, we did a post-mortem. We had followed all the right risk management processes, and, theoretically, done everything right. But the trade had still failed. Why?
Of course, we discovered that what we thought was a hedge really wasn’t. But during this analysis, we found something else that was the hedge we needed. Because we analyzed the loss, we actually started to do better than the municipal bonds desk ever had before, thanks to the new information we learned.
This process of analyzing and learning from a loss isn’t easy. The learning process is more challenging in difficult environments than positive environments. It’s harder to pivot, adjust and improve when you’re already in the Olympics than when you’re on a training run or coming off of a win. Yet we often learn more important lessons from a loss than from a win, whether that’s in sports or business.
Do you have a story about turning a loss into a win? Share it with me at @CoachJoeMoglia.