Tips To Help You Recover from a business failure

0 August 30, 2018 By Dang

We all make mistakes. In fact, mistakes are part of life for every business and every working person. That said, a high-profile mistake by the CEO or top leader of a small to medium-sized company can inflict out-sized consequences upon a company and its employees.

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If you make a similarly controversial decision, how do you manage your way through it?

We recommend following four R’s to help you navigate the choppy terrain of a public failure or corporate mishap.

  • Regret
  • Responsibility
  • Resolve
  • Refocus

Be aware: Every step of the four R’s requires you to flex considerable communications muscles.

Regret

Is it any wonder the two most difficult words for leaders to express are “I’m sorry?” As difficult as it is to admit mistakes, expressing sincere regret for what happened is a crucial first step to demonstrating the kind of vulnerability that rebuilds trust and confidence with your stakeholders. Done right, apologising for our mistakes breaks down defences and sends a powerful message of strength and humility.

Your conversation might go like this: “I realise that my mix-up of the dates really puts your team in a bind, and I’m very sorry for the delay.”

Communicate respect and concern for those dealing with whatever consequences your actions have had. Also, give the other party a chance to voice any concerns and ask questions.

That said, be careful about over-apologizing. Too many mea culpas may make you seem insincere or weak, which will undermine your efforts.

Responsibility

According to Justin Menkes’ book, Better Under Pressure, truly great leaders accept ownership when things go wrong. Owning the problem communicates to others that your relationship is more important than being right. It also sets the stage for taking off the blinders and facing our flaws. While it’s not easy to own our mistakes, hiding or denying them can cause irreparable damage. Remember Watergate?

Resolve

If your decision exposes or creates a problem, you may find your team members are encouraged to create solutions that didn’t exist before.

For example, one financial services company had to cut their workforce by 20 percent to make up for the loss of business after a product failure. Ultimately, the company was spurred to improve several processes and systems that created a leaner, stronger operation.

So, once you have identified a solution, the next step is to communicate your plan of action. Consider, what will you stop, start or keep doing to transform the situation? People are prone to be more understanding when they see you have carefully considered a viable remedy to the situation.

Start by admitting exactly what happened, why, what you’re doing to fix it and steps you have taken to prevent it from happening again. You might start out by saying, “I’m sorry the checks didn’t go out as promised. Here’s what caused the error and here’s what I’m doing to make things right as quickly as possible.”

Refocus

Whether you are recovering from a minor misstep or a more serious strategic blunder, once you have communicated the way forward, it’s time to refocus your energy on the power and promise of your company’s brand. This step reinforces the message that no matter what has happened, your business remains unchanged in the areas that matter most.

Source: Insperity.com

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