Having been a student of the Indian education system and then a teacher in the US education system, a common question that I receive from friends and relatives is, “Can you contrast the two systems?”

To me the biggest difference is the attitude toward failure that is fostered by the two systems. As was so well highlighted in Rajkumar Hirani's film, 3 Idiots , the education system in India, with its focus on outcomes (grades) rather than a love of learning and experimentation, tends to foster a dread toward failure that stymies innovation. Yet, examples abound of Indians succeeding in the entrepreneurial space. How did they succeed despite being students of such an education system? The answer lies in their approaching failure with the right attitude and harnessing it as a blessing not a curse.

I've coined two terms that describe how people view failure: the type 1 mindset and the type 2 mindset.

Two mindsets

The type 1 mindset is fearful of making mistakes. It characterises most individuals, managers, and corporations today. In this mindset, to fail is shameful and painful. Because the brain becomes very risk-averse under this line of thinking, innovation is generally nothing more than incremental. You don't get off-the-chart results.

The type 2 mindset is fearful of losing out on opportunities. Places such as Silicon Valley and the Stanford Graduate School of Business are full of type 2s. What is shameful to these people is sitting on the sidelines while someone else runs away with a great idea. Failure is not bad; it can actually be exciting. From so-called “failures” emerge those valuable gold nuggets –– the “aha!” moments of insight that guide you toward your next innovation.

We generally start out with the type 2 adventurous spirit as children. But then somewhere along the line, often in the classroom, we are squelched. Failure is not allowed. We become type 1s.

So how do you get people and corporations to shift from 1 to 2?

One approach is to engage them in rapid prototyping –– the process whereby they brainstorm wild new ideas and then quickly develop a physical model or mock-up of a solution. This allows people to move quickly from the abstract to the concrete and lets them visualise the outcome of their ideas. It gives the brain richer inputs.

Because not all prototypes end up as the best or final solution, rapid prototyping also teaches that failure is a part of the process. You may chuck an idea and say, “Let's try something else,” but you keep moving in a positive way. This whips the brain into associating “failure” with pleasure.

Another way to shift people into type 2 thinking is, paradoxically, to instil in them a sense of “desperation.” This is done by cutting resources so that they are forced to devise new solutions. As we know, necessity is the mother of invention.

In India, where we have known lack for centuries, the practice of jugaad is part of management lexicon. It refers to the inventive approach people must take to manage the scarcity that is so often a part of the landscape.

Anheuser-Busch InBev stimulates a kind of jugaad mentality each year by decreasing the advertising team's budget while demanding increased performance. Following a period of desperation, the team is spurred to look at new, less expensive ways of communicating its message.

Many corporations try to use the opposite of desperation –– inspiration –– as a means of stimulating innovation. It sounds good, but sometimes it doesn't work. Often, fostering “inspiration” means putting a pool of type 2s into a closed environment where they are given license to prototype away. But then they end up presenting their ideas to whom? Type 1s. And such fearful managers shoot them down every time.

To make inspiration work as a motivator, take a look at Cisco Systems. There, type 2s are given the space and support to prototype, but they must have someone from senior management on their team. By getting such managers involved in the process, innovators have a champion who can navigate the political system and sell the idea better.

Another good example of using inspiration is TSYS Acquiring Solutions, a company that for a small fee carries out the first credit/debit card transaction at any counter by transmitting the data to the networks and banks. To diversify their business, they developed an ingenious way to reward innovation in the corporate culture. Each employee is given “TSYS dollars” to “invest” in creative solutions posed by internal teams on the company intranet. The most heavily invested idea is actually implemented. By turning innovators into company icons, they encourage others to submit new solutions.

The education system

The ideas listed above need to be incorporated into the Indian education system. For example, more schools should incorporate rapid prototyping in the curriculum and pedagogy as a way to instil type 2 thinking. In my course ‘Frinky Science of the Human Mind' at the Stanford Graduate School of Business, students used this technique to apply the principles of human brain functioning toward figuring out how customers can be made to feel comfortable with their buying experience and, thereby, choose one product over another. In our executive programme, senior managers have developed prototype solutions for how airlines might better handle delays with customers.

The bottom line: Failure is not bad. The sooner educational institutions in India realise this, the sooner they will be on the road to producing that talent that is needed for breakthrough thinking.

(The writer is a management sciences professor at the Stanford Graduate School of Business.)

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