Imagine you are back in the office, busy going about your usual hectic day, when the head of the Risk Department stops by. Judging by the look on her face, you know immediately that there’s a problem. She tells you that, because of a processing error made a month ago by one of your team, a trade for a client was booked as a sell, not a buy…and that error had only just been discovered. Throw in that the markets have moved in the intervening month, and the loss stands to be in the millions of dollars. You know what comes next: that initial punch-in-the-gut, queasy feeling that then goes through your whole body and that you can taste in your mouth. It is during those next few moments, when you are recovering from the initial body-slam, that how you react could define the course of what follows.
A good analogy is that of a burst pipe in your house or apartment. You first need to stop the leak and fix the pipe. The longer it takes to discover the leak, the worse the damage, so time is of the essence. Only then can you begin to repair your house and replace your possessions. Later, lessons learned can be translated into long-term benefits: what could you have done to prevent the pipe from bursting? Install a water shut-off device? Turn the water off when the house is empty for a week in the cold of winter?
Enter a maxim that I have found so useful throughout my career: breakdowns create opportunities for breakthroughs. The key to its successful application is the word “opportunities”. How you approach a breakdown will determine whether you have been able to fully mine the opportunity.
There are plenty of wrong ways to handle a problem. We have all seen them: “shoot the messenger”; scream, shout, and storm out of the room; blame the presumed perpetrator; and throw in a good dose of belittlement and scorn. While your feelings are natural, such emotional responses are counterproductive and will curtail your chances of finding out about the next problem in a timely fashion! Errors often cost money, and as in the burst-pipe analogy, the longer it takes to unearth and rectify an issue, the larger the loss. In my former world of financial securities, we knew that the key was to leave the door open – to create an environment in which issues could be raised immediately, where everyone could learn from their mistakes, and where the group felt a collective responsibility to improve and avoid the next breakdown.
By way of comparison, what reception does an open, powerful question such as “What can we learn from what’s happened?” receive? Such a question carries with it a lack of assumption of blame. It gets a better reception from the get-go, encouraging reflection, motivating fresh thinking, and opening the door to change. This growth mindset allows us to move away from a focus on mistakes, and towards the leveraging of possibilities.
Managing a problem well allows a person or a group to reflect on the breakdown, leading to a better awareness of self- and collective responsibility. It strengthens relationships and improves processes. It allows for individuals to be more confident, and more assured, in the direction and culture of the organization. In the “heat of battle”, we need to be able to recognize that there is an opportunity, and have the presence to seize it.
How do we stop the gut reaction, calm our minds, and find a constructive way forward? Try one of these:
- 5-Second Rule: Nip the anger in the bud. When you first hear of that enormous error, resist the temptation to speak. Take a deep breath, and count to five, then move forward with curiosity. Ask an open question, such as, “What do you think we need to address first?” The more you practice a simple reset routine, such as taking a deep breath or two, the more you develop your instincts to contain that rising anger. Recognize it and turn to your positive, open, curious side.
- The Stoic Test Game: If you are into Stoic philosophy, imagine that Stoic gods have provided you with a challenge. Why have they inflicted this test? Because they want you to thrive, to be strong, to be resilient. Rather than getting stuck in a negative loop, treat the challenge like a game, and use it to move forward as if you had something to solve. Again, try leading with a question. Ask your Risk Manager, “How do we learn and improve from this?” This question will also buy your brain more time to focus on positive action.
- The “Three Gifts” Technique: When you have gathered the people who should be part of the solution, ask them to come up with at least three scenarios in which their supposedly bad situation could turn into a gift and opportunity. This technique can open up the dialogue, and while people may at first be puzzled by the indirect approach to problem solving, it lays the groundwork for that advance forward.
Continuous application of the mantra “breakdowns create opportunities for breakthroughs” – with a group, a division or across an entire organization – helps to frame a common language and to develop a shared image of how to move forward. Research shows that employees with a strong sense of ownership in their organizations are more committed, satisfied, and productive. As Stanford professor Shirzad Chamine says in his book Positive Intelligence, your internal Sage tells you that everything, even your mistakes, can be turned into gifts and opportunities by your reaction to them. So, the next time someone comes to you with an issue, calm your mind and ask yourself, “where is the opportunity here?”
Do you need to shift the direction of your team or organization, turning breakdowns into breakthroughs? We acknowledge that what we are recommending is difficult, and will require practice. It will take time to get that muscle memory re-programmed, and could feel unnatural at first. Epicoach can help you adjust your mindset, improve your organization, and really learn from mistakes! To hear more, contact us at David@epi.coach .SHARE: