Celebrating Failure at Drug Companies

The Wall Street Journal had an interesting article about the pharmaceutical industry on Saturday. In this article, they described a new type of party being held at some firms:

After making the difficult decision to scrap a once-promising drug program, the biotech firm Ironwood Pharmaceuticals in Cambridge, Mass., did something unusual: It gathered to celebrate. With dozens of staffers in attendance, the “drug wake” at Ironwood featured seven-layer dip, homemade cupcakes and a bittersweet send-off. “It’s hard to say goodbye, so I won’t,” said Mark Charest, who works on regulatory affairs at the company. “I’ll say, ‘Thank you—thank you to the peptide.’ ”

The article describes how firms are holding these types of events to prevent researchers from becoming discouraged after lengthy efforts that do not lead to a product that can go to market.  It also describes how companies are conducting extensive after-action reviews to capture the learning from these failed drug discovery efforts.  Finally, they want to avoid excessive risk aversion; they want people to take risks in hopes of discovering the next highly effective drug.  

I would argue that these efforts also de-stigmatize failure and perhaps help people make the tough decision to stop a research effort and cut their losses.   We know that the sunk cost trap can cause researchers and managers to throw good money and effort after bad in the drug discovery process. By minimizing the stigma of failure, perhaps these firms can make it a bit easier for people to cut their losses.  In the end, that will lead to a much more efficient use of resources at these firms.  

Can You Have Too Much Grit?

Amy Morin writes in Forbes this week about an interesting new study about grit. The study, is titled "When the going gets tough: Grit predicts costly perseverance." The authors are Gale Lucas, Jonathan Gratch, Lin Cheng, and Stacy Marsella.  Note that a lengthy stream of research over the past decade or so has extolled the benefits of grit.  What is grit? University of Pennsylvania Professor Angela Duckworth defines grit as "perseverance and passion for long-term goals." Duckworth has studied grit extensively in her academic career. She has found that intelligence is not always a good predictor of academic or professional success. Grit matters. For instance, she has found that, at West Point, a cadet's grit score is the best predictor of success in "Beast Barracks" – the incredibly challenging, six week summer training regimen that all new cadets must endure. Grit predicted success more so than intelligence, leadership ability or physical fitness.

The new study by Lucas and her colleagues examines whether grit may come with some negative consequences.  Could it be possible for someone to exhibit "too much" grit in some circumstances, leading to poor results?  In a series of studies, Lucas and her colleagues had subjects tackle very challenging tasks.  What did they find? 

Across three studies, we found that higher grit individuals invest more effort and persist in tasks that are not going well. Grittier participants were less willing to give up when failing even though they were likely to incur a cost for their persistence. In Study 1, grittier participants were able to complete fewer problems in an anagram task where some of the items should have been passed over (i.e., unsolvable items). This provides initial evidence that they persisted at a cost to themselves, in this case the cost of getting to attempt more problems. Because we incentivized performance (with entries into a lottery for $100), it seems that grittier participants were specifically trading off greater chances at monetary gains to persist at the more difficult questions. Compared to participants with lower grit, grittier participants not only increase effort when they are losing a game (Study 2), but also are more likely to stay and keep fighting a losing battle when they could quit (Study 3).

The New Everest Movie

On Friday, September 18th, the new movie - Everest - premieres at theaters across the United States.  The film chronicles the tragic events that took place on the world's highest mountain in May 1996.   Rob Hall and Scott Fisher, two experienced expedition leaders, died on the mountain along with several others.  Jon Krakauer wrote a best-selling book about those events (Into Thin Air).  I'm curious to see the movie, as I wonder how accurately it will depict the decisions and events of May 1996.   I'm looking forward to the film, as I have spent more than a decade studying this particular tragedy as well as expedition teams in general.   I've spent consider amounts of time interviewing climbers, including several people who were on the mountain when this tragedy occurred.  My work has focused on how expedition teams make decisions, and how leaders behave in these circumstances.  

My work on Everest expedition teams has included the following:

- Harvard Business School case study (and teaching note)

- Everest: Leadership and Team Simulation (a simulation for teaching about team decision making)

- California Management Review article about the 1996 Everest tragedy
- Great Courses lecture series - The Art of Critical Decision Making (Lecture 2)

- Ivey Business Journal article on how to avoid the sunk cost trap

- ILJE article titled  Teaching Business Leadership Using Non-Business Case Studies: The Mount Everest Example

I've also written about Everest climbing teams in my book, Why Great Leaders Don't Take Yes for an Answer.   Below you will find two videos about my work.  One focuses on the simulation, while the other discusses the leadership lessons from the catastrophe.  

Can Meditation Reduce the Sunk Cost Bias?

The sunk cost bias is the tendency to "throw good money after bad" in situations where you have made a substantial commitment of resources that you cannot recover.   Over the years, many studies have documented this decision trap and shown that many of us are vulnerable to this bias.  Now, a new research study shows that meditation may actually mitigate the bias.    

Andrew Hafenbrack and his colleagues have shown that 15 minutes of "mindfulness meditation" can actually reduce people's tendency to fall into the sunk cost trap.  According to the BPS Research Digest, "Mindfulness meditation is all about learning to stay in the moment, and the researchers think it probably helps reduce the sunk-cost bias because the error is partly caused by memories of prior investments, and also by anticipation of regret in the future if a project or prior purchase is abandoned."