We know that failure more often than not excites one of two mindsets: perseverance or dejection. Sometimes a misfire can even inspire an imperfect solution of both.
But what are the mechanisms that see one trump the other venture to venture? According to a new paper published in the Strategic Management Journal, character isn’t the strongest impulsion concerning how we react to defeat. Executive function is unlocked by a steady combination of virtues.
From the report: “We examine the influence of two conflicting emotions—group fear and group hope—in entrepreneurial team decision‐making. We are interested in which emotion will be more strongly related to whether entrepreneurial teams escalate their commitment to a currently failing venture versus terminating that venture. Using a longitudinal start‐up simulation and based on data from 66 teams across 569 decision‐making rounds, we find that group “hope trumps fear.”
Fear vs. Hope: Which is Stronger in Venture Termination/Escalation Decisions?
Collaboration is a forceful motivator in and of itself when it comes to sustaining commitment.
Understanding this going in, the study’s authors, Tori Huang, Vangelis Souitaris and Sigal Barsade, additionally explored the threshold wherein affinity for a colleague begins to be detrimental more than advantageous. Interestingly enough, personal fondness between colleagues can actually be a liability if honest communication isn’t a prominent aspect of the dynamic.
The study correctly notes that the traits that strengthen a personal friendship rarely carry over into a professional one. In fact, a convivial rapport has a way of keeping constructive feedback behind a wall of vague language and outright reticence.
Huang explained in the paper, “It’s inevitable that like-minded people flock together. Being aware of the implications of working with friends is crucial. As we argue in the paper, friends “feel” for each other more because they care about each other. But friends do not necessarily “think” alike. Communication is key and is often taken for granted in start-up teams, exactly because people are friends. Moreover, it is important for a team to have complementary skills as well as mindsets, no matter how close they are as friends.”
Huang, who is an entrepreneur herself, says she experiences the dichotomy of hope and fear every day, “It’s fair to say that I am experiencing the phenomenon myself every day now, and I expect that, in the near future, there will be further research on this topic.”
Over time she’s learned how to weaponize and temper each according to her needs. Fear can certainly be a useful emotion if distilled. In its purest form, fear makes us provident and economical. When excreted soberly we might call fear instinct. Hope can be a similarly useful virtue because it allows us to take risks that we might not otherwise take.
In any case and whatever the precise formula, the authors posit that the latter should always be observed in greater concentration than the former, for the sake of any successful entrepreneurship. Thankfully, when defeat backs us into a corner, hope seems to be a congenital function.
“In line with the findings of this research, we demonstrate the power of hope. We show that hope, rather than fear, guides entrepreneurial pursuits. The natural instinct to avoid danger is important as well, but there cannot be great pursuits without risk-taking. Hope is also important to the process – as entrepreneurship is a process that requires continuous efforts in an extended period of time – and the “togetherness” people feel in the process as a team,” the authors conclude. “Our results indicate the importance of entrepreneurs understanding and managing their team emotions for the best decision‐making. It also helps explain the continued engagement of entrepreneurial teams who even, when fearful, have hope.”