The Mistaken Perception of Mistakes
We all make mistakes. Companies make mistakes, too. We can try our best to prevent them, but it’s often how we rebound from our mistakes often that ultimately defines how others view us and shapes our success.
There are several classic examples where companies have done a great job being upfront about mistakes or were even able to turn them into success stories. For example, in 1982, Johnson & Jonson recalled and destroyed 31 million Tylenol capsules at a cost of $100 million when the product had been tampered with. The CEO appeared in television ads and at news conferences informing consumers of the company's actions. Tamper-resistant packaging was rapidly introduced, and Tylenol sales swiftly bounced back to near pre-crisis levels.
Then there’s the well-known failure of New Coke. People remember that it infuriated long-time consumers, cost a ton of money and lasted only 77 days before Coca-Cola Classic was reintroduced. Still, New Coke could be viewed as a success because it reattached the public to the Coke brand and revitalized sales (back to the No. 1 one spot ahead of Pepsi).
In many ways, companies and individuals should adhere to the same set of principles when a mistake occurs. Amy Gallo, Harvard Business Review Best Practices writer, offers these solid guidelines in her recent article on mistakes:
- Accept responsibility for your role in the mistake
- Show you've learned and will behave differently going forward
- Demonstrate you can be trusted with equally important decisions in the future
- Be defensive or blame others
- Make mistakes that violate people's trust — these are the toughest to recover from
- Stop experimenting or hold back because of a misstep
The last point is particularly important to remember in any discussion about mistakes. A key skill for businesses managers to acquire is identifying when it is acceptable to make mistakes. In the health care industry, mistakes in patient care are unacceptable. But it is still an industry that needs rapid innovation – particularly in the area of processes – and one that can benefit from some calculated risk-taking.
Paul J.H. Schoemakerorganizations need to make mistakes in order to improve and should be the least afraid of mistakes when:
- Fresh approaches to a complex problem are needed
- The potential learning from a failure far outweighs the potential cost
In a time when Six Sigma, Lean and other forms of process improvement are becoming more pervasive, the way we address our mistakes is an important aspect of business now more than ever.
When we view mistakes as learning opportunities and not something to hide, it’s possible to have an environment where accountability is balanced with transparency, and that creates an environment geared for success.