Not business as usual: Mistakes do happen
September 5, 2017
A while back, we offered a column that suggested an approach for proactively dealing with an organization's disappointment/bad news. But how about a simple mistake? As the frequency and probability of making a mistake is significantly higher than having to deal with bad news, some type of framework of analysis and resolution is critical for sustainable success. Or as an early mentor in my business life told me, "There are two things you need to know about mistakes. The first is you will make them and the second is you need to know how to fix them."
Perhaps the first step is simply categorizing the mistake as one of "personnel selection" or simply "other." "Personnel selection" can be in the hiring process but it can also apply to an assignment or promotion. "Other" might be a mistake in pricing, a decision on allocation of marketing resources, etc., but one generally not involving people. How an entrepreneurial manager handles missteps in both categories speaks volumes about the integrity of the company and has a direct impact on the company's ability to find, attract, and retain talented individuals.
When addressing the personnel selection aspect it is important to keep in mind two rules. The first is that employing people and promoting people is not an exact science. Tangible and intangible variables are always in play and your goal is to make as educated a guess or forecast of success as possible. The second rule is that no matter how much you want someone to succeed, in the end it boils down to that individual's talent and willingness to put forth the effort. While there are many companies that specialize in helping to pinpoint the talent aspect, the will to succeed is much more difficult to discern. As a result, many assume that historical information is a valid predictor of future results. Unfortunately, too many non controllables can sometimes overshadow even the best of character traits so background/reference checking is both a recommended and a required process.
But what happens when the best testing and the best background checks result in a hiring decision that is just not a good fit? First off, it is important to realize that if you feel that it is not a good fit, then the poorly fitting new hire also feels it. Is the disconnect due to inadequate skills or is it a personality/culture issue? The former can often be rectified through a reassignment; the latter almost always requires a separation of ways. Both merit a conscientious process on the part of the owner/manager and both changes have to be handled with the dignity of the individual being always maintained.
While a hiring mistake can be considered "in house," what do you do when you make a pricing mistake? While you may feel like you belong in the "outhouse," there are steps that you can take to minimize the impact. Depending on the magnitude of the mistake, I have found most customers very open to the prospect of working with you to minimize any damage. While there are certainly some who take an almost perverse delight in your mistake, most ethical business people are not out to take advantage of others. They also recognize their own potential vulnerability in making a mistake, and know that it is in everybody's best interest for a fair solution or outcome to be reached. But the initiation for this request as well as the catalyst for a mutually agreeable solution has to come from the source of the mistake.
Good salespeople know the selling maxim of never being afraid to ask for an order. Good entrepreneurial managers also know the management maxim of never being afraid to admit to a mistake.
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Following a successful international business career, John Riddell turned his attention to small business/entrepreneurial pursuits that included corporate turn-arounds, start-ups, teaching as an adjunct business school professor, authoring noted business and sports columns, and serving as VP for the Chattanooga Chamber of Commerce directing its Center for Entrepreneurial Growth. He can be contacted at firstname.lastname@example.org.