In family businesses, there seems to be little difference between a truly outstanding manager and an adequate manager. The landmark study on how executives learn, grow, and change conducted by the Center for Creative Leadership, found that one of the few but most significant differences between superior managers and adequate managers was failure.
One might assume that superior managers fail less often than average managers. In reality, superior managers do not fail less, they just fail better.
The best way to explain fail better is to compare the way the average manager fails to the way a superior manager fails.
When the average manager fails, he or she is likely to do several things, often in this order.
1. When an impending screw-up is imminent, the manager attempts to fix it alone.
2. He or she works very hard to keep the coming failure a secret.
3. When the failure rises to the surface, the manager blames him or herself excessively.
4. In many cases the manager continues to blame him or herself for a long period of time. It is not uncommon to hear a manager describe a bad decision that was made ten years ago as if it happened yesterday.
On the other hand, the superior manager approaches failure very differently.
1. When it is clear that failure is likely, this manager lets people know that he or she has screwed up and needs help.
2. Working with superiors, peers, direct-reports, customers and family members this individual works to minimize the impact of the failure – to cut the losses.
3. The superior individual then asks the question, “What can I learn from this experience?”
4. Then this manager does a remarkable thing: he or she forgives himself.
The ability to fail well may be more important in a family business than in any other kind of business. For whatever the reasons, families are masters at creating secrets. Most all families have their particular secrets that they pretend don’t exist. It could be Dad’s drinking, Mom’s eating disorder, Brother Bill’s run-in with the law, or Uncle Harry’s sexual preference. The nature of the secret is less important than the fact that they become secrets. Often secrets are like a white elephant in the living room. Everyone knows it exists, pretends it is not there, walks around it and, at whatever the cost, does not talk about it. When treated as a secret, the human frailties found in all families become poison. The last thing a business needs to do, especially a family business, is turn business failures into family secrets.
If failing well is such an important aspect of business, as someone who leads your organization, what can you do to facilitate learning from failures?
� Don’t rage and punish when someone fails. Most people are pretty bright. If they make a mistake and then get verbally assaulted, next time they will keep their failure a secret.
- Listen before you move into the “fixing the problem” mode. Seek first to understand, then to be understood.
- Be very clear that personal worth is not equal to business success.
- When someone fails, help him or her. Ask questions like, “What can be learned from this?”and “Next time when you encounter a similar situation, what might you do differently?”
- Be straight about your own failures – past and present. Also, acknowledge what you learned and are learning from your failures.
It is only natural to avoid failure and to want to hide it. However, healthy businesses know that moving forward requires risk. And with risk comes failure. Several years ago, while working for a large oil company that verbalized the value of risk, I made the mistake of believing them. I took a risk that failed. Never have I been organizationally punished as I was for that particular failure. What I discovered was that my employer did value risk, but only if it was successful. Interestingly enough, shortly after leaving the company, the particular division I was part of was dismantled – because it “played it too safe.”
Failing well is critical to the success of business, especially family business. And yet, very few individuals and businesses know what to do with failure. An organization’s ability to learn from failure is often the critical difference between being an adequate organization or being a superior organization, a truly great company. After all, when was the last time you learned anything from “trial and success?”
Dan Pryor consults with promising executives committed to personal growth, increased effectiveness and success