Failure: Cost or Investment?

Are you willing to let your managers fail? Last year one of my clients promoted an employee to Division Manager.  This new manager agreed to a compensation program that included both a base salary and incentive based on profits.

During the year this manager was coached by his boss to no avail.  His boss is one of the most successful business leaders I've ever known.  Despite the good advice he was receiving, the division manager insisted upon using his own management techniques.  Even when the monthly financials showed that his efforts were not producing the desired results, he shunned his boss’ advice and continued to use his own techniques.  As you've probably guessed, his incentive check for the year was zero.

You'll be happy to learn that this year he's embracing the advice he's getting and, in the first four months of the year, he's already halfway toward achieving his incentive goal.  He has a clearer understanding of his work force capabilities, the type of customer who appreciates those abilities, his cost structure and how to position his division for premium pricing.  It's an amazing turnaround.  The question is "How many of you would've been willing to let this manager fail in his first year?"

Short memories

Whether you’re the owner of the company or a senior level leader it's easy to forget how rocky your road was in getting to where you are today.  With a little reflection, I'm sure that you’ll join me in sporting a broad smile, shaking our heads in disbelief at the bonehead stunts we've pulled despite the warnings of others.  Our bosses gave us a chance to fail.  Don't we owe that to the next generation of business leaders?

I'm not suggesting that you give these emerging leaders an open checkbook or an infinite amount of time to make the same mistakes repeatedly.  It's your responsibility to limit your company's financial exposure in these situations.

The Division Manager mentioned earlier kept the operation profitable.  He did not grow profits sufficiently to earn an incentive.  If he hadn’t maintained profitability, he probably would not have had a year to learn the lessons he needed to learn.

This isn't the only example that patience with new leaders can pay off.  Patrick Kelly in his book, Faster Company, describes his management system in which the employees have the right to fire their bosses.  Mr. Kelly goes on to tell us that 30% of his senior management team had once been fired by their employees, learned their lesson, returned to management and became effective leaders.  Mr. Kelly had the patience to let people fail.  Why do we find it so difficult to do?

Self-preservation

Often, we fear that employees’ failures will reflect poorly on us or our company.  Our natural tendency is self-preservation.  When a new manager fails to meet expectations, we step in and take action to avoid being painted with the same brush.  The reality is that any new hire or promotion will result in a temporary loss in performance.  How do you protect your new manager, yourself and your company?  Set performance expectations!  If you’re not the owner, make sure that the owner is involved in setting expectations.

Remind the owner, as I did earlier in this article, of the rocky road we all traversed.  Set the expectations – communicate clear goals and time frames that have been set with input from your new manager.  Put these expectations in writing.  This simple step will lay the foundation for patience for you and your boss.

That leaves us with two more questions “Why don’t new managers take their boss’ advice?  Why must they learn the hard way?”

Human nature

It's our nature to trust personal experiences over the advice of others.  A little reflection will rekindle the feelings of skepticism we experience when we're asked to choose someone else's counsel over our own experience.  When we lack experience we trust our intuition over the advice of others.

I remember playing bank pool with my dad.  I was setting up to take a shot that required me to bank the ball off the far cushion.  My dad said “Dale that shot won’t go.”  What he was telling me is that the angle I was attempting couldn’t possibly succeed; yet he could tell that what I was having trouble visualizing the shot he suggested.  Finally, he said “Shoot your own shot, if you can’t see it you can’t make it.”

I took my shot and he was right, it wasn’t even close.  Yet if I hadn’t taken it, and had missed the shot he suggested, I’d have always wondered whether I was right.  Failure is an essential element in personal and professional growth.  Sometimes we, as business leaders, need to let things fail so that the other person can see that “their shot won’t go.”

Protect your new managers, yourself and your company by limiting the cost of failure.  Let you managers shoot their own shot.  Debrief them on the results they’re getting.  Help them evaluate alternatives without offering advice.  Soon, they’ll learn to trust your experience and be more open to your advice.  That’s when you’ll get your return for having allowed them to fail.

Copyright 2006, Dale Furtwengler, all rights reserve