if you create a culture where failure is not an option then you will find yourself with a culture where innovation and even SUCCESS are also not options.
so, if you don't allow people to fail you won't allow them to ever succeed.
i am sure i stole that from someone famous and probably jacked up the wording, but chew on that for a few days.
Risk and pushing the edges and NOT BEING AFRAID TO FAIL is a key to innovation and success! so let it happen in your culture.
in fact - encourage it!