How to Learn From Your Mistakes in Business
Mistakes made in the course of running a small business are sometimes minor, sometimes costly. But with the right mindset, you can turn these errors — both your own and those of your employees — into opportunities to learn and improve future performance.
Here’s how to figure out why things go wrong and how to benefit from any missteps.
1. Admit, rather than deny. The first thing to do after you’ve made a mistake is own up to it. Denial only increases the chances you’ll repeat the error. Foster a culture of openness, honesty, and responsibility at your place of business by setting an example with your own behavior.
2. Determine why the mistake happened. When something goes awry, ask questions designed to pinpoint its cause:
- Did I/we have unrealistic expectations about could be achieved?
- Did I/we base decisions on incorrect assumptions?
- Did I/we execute improperly after making the right decision?
- Did I/we adequately prepare to take action?
The goal in asking these and related questions is to better understand your thought process. Retracing your actions, step by step, enables you to identify any flaws in your thinking and eliminate them from your decision making process.
3. Take an outsider’s perspective. Sometimes it’s hard to look objectively at your own actions, but when reviewing mistakes, try taking the perspective of someone outside your business. Identify the strengths and weaknesses of your decision-making process as if you were analyzing that of a colleague or competitor. An honest analysis opens you up to using different strategies going forward.
4. Don’t try to be perfect. Some mistakes may arise from the idea that every aspect of your small business — and the processes behind it — must be “perfect.” Forget perfection, both from yourself and your staff, because achieving it is impossible.
5. See whether bad habits contribute to mistakes. Are you always rushing from one thing to the next? Do your attempts at multitasking result in more errors in judgment rather than fewer? Are you losing focus and not paying attention at critical moments? All of the above can lead to mistakes on the job.
6. Learn from others. There’s a lot to gain from examining the mistakes that other small-business owners have made. Search the web for case studies, blog posts, and articles related to the type of error you made. Have candid conversations with peers in your network. You’ll often find that others have been in a situation similar to yours, and their solutions can spark constructive thinking on your part.
7. Apply what you learn. After doing some research, rigorous self-analysis, and/or consulting with a mentor or friend, you should have a pretty good idea of what went wrong and why. Now you have valuable information to use the next time your company faces an important decision (including, in some cases, the advantage of knowing what not to do).
From there, try changing the way you address problems as they come up. Depending on the circumstances, take an alternate approach to the solution. If the issue is complicated, work to resolve one aspect of it at a time, rather than tackling the entire problem all at once. Experiment with strategies you’ve uncovered from research or conversation with others. Remember, the most successful entrepreneurs make plenty of mistakes before achieving greatness.
8. Move on! It’s possible to become obsessed with your mistakes (which is a mistake in itself). Adopt a more realistic attitude: Acknowledge that mistakes are still possible down the road, but you and your employees now have the ability to learn something from them (see #7). The new knowledge you acquire makes your business stronger, more resilient, and less inclined to make the same mistake twice.
Lee Polevoi is an award-winning business writer specializing in the challenges and opportunities facing small business. He is former Senior Writer at Vistage International, a global membership organization of CEOs.