A bitter wind accompanies the dawn sun in California's Mojave Desert.

It's only 5:16 AM, but Brigadier General William "Scott" Wallace, commanding general of the U.S.

Army's National Training Center, has been up for two hours. Accompanied by senior military officers from 30 nations, he's made his way to a hill that offers a choice view of today's battle.

Below, across miles of rugged terrain, 4,000 soldiers are preparing to engage an enemy force. For the last 10 days, the two sides have been doing battle with lasers that substitute for real warheads. Now, for the first time, they're experiencing live-fire -- the only way to appreciate the devastation and lethality of modern combat. F-16s scream overhead and drop thousand-pound bombs that literally make the earth move. Tanks and Bradley Fighting Vehicles face off against each other, and M109A6 Howitzers fire 155 millimeter rounds that don't merely disable their targets but utterly disintegrate them.

For most people, this is hell on earth. For General Wallace and his troops, it's just another day at the office -- one with a uniquely important mission.

The national training center is more than just ground zero for army war games. It's the world's most powerful laboratory for leadership development and organizational change. Refined and perfected over the past 15 years, the NTC is credited with almost single-handedly transforming the post-Vietnam army. Six other countries consider it an indispensable training ground for their riskiest missions. And several of America's most forward-thinking companies -- including Motorola and General Electric -- study it as a source of ideas about leadership and learning. The experience of "learning through failure" is the definitive model for preparing for combat --or for the challenges of business.

"I learned more at the NTC in 14 days than I learned in the previous 14 years of my career," says Major General Leon LaPorte, himself a former NTC commander. The heart of the NTC experience is the army's willingness -- eagerness -- to learn from failure. Over a grueling two-week period, a brigade (3,000 to 5,000 soldiers) goes head-to-head with an opposing force of similar size. Some 600 instructors (one for every brigade member with leadership or supervisory responsibilities) shadow their counterparts through 18-hour days, provide personal coaching, and facilitate team meetings as participants struggle to understand what went wrong and how to correct it. These meetings -- called After Action Reviews -- are the crucible of the learning experience, the place where hardship meets insight, where failure meets growth.

"At every level, every fiber of the organization is stressed for a full 14 days," Wallace explains. "Some of those fibers break. Those are the ones you hone in on and repair during the training experience. This process allows commanders and their organizations to be brutally honest with themselves about their successes and failures on the battlefield. As a result of that honesty -- and the desire to learn from it -- the individuals, the unit, and the organization all become better."