Legal Failure is Inevitable—The Key is Failing the Right Way 🔍⚖️

Legal Failure is Inevitable—The Key is Failing the Right Way 🔍⚖️

Failure isn’t just a possibility in product development—it’s a certainty. But not all failures are created equal.

As product counsel, understanding the types of failure can help us guide teams through legal and compliance risks without stifling innovation:

❌ Basic failures – Avoidable errors in well-known territory (e.g., missing a regulatory requirement).

⚠️ Complex failures – Multiple, interdependent issues leading to legal missteps (e.g., privacy failures due to cross-team misalignment).

💡 Intelligent failures – Hypothesis-driven experiments in new areas that lead to learning (e.g., testing compliance approaches in novel AI use cases).

The Product Counsel’s Role in Smarter Failure Management

🔬 Embrace intelligent failure. In emerging regulatory landscapes, controlled failures are not setbacks—they’re insights. When advising on novel products, structure legal reviews to allow learning from the unknown rather than avoiding it.

📊 Frame risk assessment as a hypothesis. Instead of assuming a feature is compliant, treat it as a question to be tested. What do we know? What don’t we know? What’s the safest way to find out?

🛠️ Pilot first, launch later. Just like new aviation maneuvers are tested in simulators, new product features should be rolled out in low-stakes environments—beta tests, controlled deployments, or sandbox environments—to surface legal issues before they scale.

🎭 Distinguish real vs. perceived risk. Some legal concerns feel catastrophic but are actually manageable. Help product teams calibrate risk appropriately—not all failures are disasters, and some are necessary for progress.

💬 Normalize learning from legal “oops” moments. Julia Child once flipped an omelet wrong on TV and casually said, “You can always turn it into scrambled eggs.” That’s the mindset we need in legal innovation. Small mistakes in controlled settings are part of the learning process.

Legal by Design = Learning by Design

Instead of being the department of “no”, product counsel should be the team enabling smart experimentation. That means:

✅ Preventing basic and complex failures through good process

✅ Encouraging intelligent failures in legally safe environments

✅ Shifting the legal team’s mindset from fear of failure to a scientific approach to compliance and risk

How does your team handle legal failure? Are you set up to fail forward—or just afraid to fail? Let’s discuss. In a YouTube video from Big Think, Harvard Business School professor Amy Edmondson discusses her research on failure, arguing that our culture incorrectly views all failure as unacceptable. https://youtu.be/Gb9tjnJWu5g?si=uJCVtn4c1mBt3t_X

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#LegalByDesign #ProductCounsel #AI #Compliance #Innovation #FailForward