Paying Down Innovation Debt


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Hey there, innovation champions!
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A few weeks ago, in “The Math Nobody Explains When You’re Handed an Innovation Mandate,” I named something I call Innovation Debt: the quiet buildup that happens every time someone takes a smart risk and gets punished for it anyway.
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I ended that piece with three hard questions. If you asked them, you might not have loved the answers.
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So let’s talk about the next part. Okay, you asked. Now what do you actually change?
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The Wobbly Edge

Back when I was a professional artist, one of the most nerve-wracking commissions I ever took paid exactly nothing. It was my brother’s ketubah, the Jewish marriage contract.
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I don’t do simple projects, so I’d designed a three-dimensional paper sculpture with a complicated five-holed window mat on the front. Then the wedding moved from September to May. The months I’d planned on turned into a few weeks.
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This was before digital cutters, so I cut the mat by hand. I spent a good hour with an X-Acto blade, flipped the mat over, and saw that the edge was a disaster. Not a crisp 45-degree bevel. Wobbly. Awful.
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No time to buy a new mat. No time to find a pro. No time to redesign.
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I sobbed for about ten minutes.
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Then I went back into the studio and, half out of frustration and half out of curiosity, cut a small divot into the edge. Huh. So I cut another. And kept going, changing the angle of the blade and the size of each cut, all the way around every window.
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When I finished, the openings were more interesting than the “perfect” version would have been.
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Hide It, Redo It, or Build On It

That mat taught me there are really only three things you can do with a visible mistake.
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Hide it. Pretend it didn’t happen.
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Redo it. Quietly start over and absorb the cost yourself.
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Build on it. Turn the flaw into material.
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I didn’t choose the third option because I was wise. I chose it because the first two were off the table.
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Your team doesn’t have that problem. Hiding and redoing are always available. And in a workplace carrying Innovation Debt, they’re the rational choices. Nobody gets dinged for a failure no one ever sees.
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Improvisers practice the third option on purpose. “Yes, and…” turns a flubbed line into the premise of the scene instead of something everyone politely ignores. My improv group runs into this every time we perform.
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The question is how to make “build on it” the safe choice at work.
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Why a Values Statement Won’t Cover It

Here’s the trap. Once leaders see Innovation Debt, the first instinct is to announce something. A new value. A “fail fast” slide. A town hall on psychological safety.
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It doesn’t work, and not because your people are cynical. They have years of evidence about what happens here when something flops. One new sentence doesn’t outweigh years of evidence.
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You don’t pay down Innovation Debt with a statement. You pay it down with new evidence. Small, visible, repeated proof that trying something and having it not work leads to learning, not punishment.
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And the first piece of that evidence has to come from you.
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The First Payment: Declare a Failure

This is Experiment #20 from Innovation at Work. If you’ve just asked those three hard questions, it’s the one I’d run first.
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DECLARE A FAILURE
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⏱ 12 minutes · 👥 3–8 people · Remote-friendly
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The move: Each person shares one small thing they tried recently that didn’t work, and one specific thing they learned from it.
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The rule that makes it work: The leader goes first. A real failure, not a humblebrag.
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The follow-up question: “What would you do differently next time?”
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What you celebrate: The learning, not the failure itself.
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Keep the failures small and recent. The goal isn’t confession. It’s lightness.
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What “Rewarding” a Smart Failure Actually Looks Like

“Celebrate failure” is a platitude. Here’s what it looks like as a mechanism your team can actually see:
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  1. You go first. The boss admits a flop out loud, and the meeting just keeps going. That’s the first new data point.
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  2. Nobody fixes it. Each share gets a thank-you, not a critique. The moment someone starts problem-solving, the room learns that sharing gets you graded.
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  3. The lesson gets used, with credit. This is the step most teams skip. When someone’s failed attempt changes a real decision, say so out loud and name them: “We’re not doing X, because [name] tried it last month and learned Y.”
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That third one is the actual reward. Not a trophy. Not a pizza party. Visible proof that trying something and having it flop made someone more valuable to the team, not less.
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That’s the math starting to change.
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One Payment Isn’t a Paydown

Run Declare a Failure once and you’ll get a nice meeting. Run it as a regular check-in and you start building a new track record.
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But be honest with yourself. If the next performance review still punishes the same risks you just celebrated, your team will believe the review. Every time. That’s exactly where I’m going next week.
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And if you’ve asked the hard questions and you’re now wondering how to do this across a whole team, not just in one meeting, that’s the conversation I love having. Book a free 30-minute Innovation Strategy Session and we’ll map out your first few payments.


Build Your Innovation Muscle!

Want more ready-made experiments to help your team build their innovation muscle? Grab the book!

👉Click here for more info
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👉Click here for a free preview PDF
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👉Click here for a special Leadership Edition — available only on my website — which includes an exclusive 5-part “Innovation Leader’s Edge” video series. Everything you need to run your first micro-experiment, get leadership buy-in, and build lasting innovation culture.


Creatively yours,
Melissa

P.S. Three ways to start paying down your team’s Innovation Debt:
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  1. 📞 Asked the hard questions and not sure what to change first? Book a free 30-minute Innovation Strategy Session → CLICK HERE​
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  2. 📗 Grab Innovation at Work: Declare a Failure plus 51 more experiments that change the math one meeting at a time → CLICK HERE​
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  3. 🎯 Not sure where the debt is building? Take the free Innovation Bottleneck Finder → CLICK HERE​
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