Admitting to mistakes may be good for your business
John O'Connor, editorial director, McKnight's Long-Term Care News
Not that anyone could blame them. After all, state inspectors are constantly on the prowl for shortcomings. Moreover, one wrong move can launch lawsuits, or worse. And as the old saying goes, you're not paranoid if the world is out to get you.
But growing evidence suggests that admitting to mistakes may be less costly to your reputation and bottom line in the long run.
Consider: In 2001, the University of Michigan Health System launched a claims management program that centered on disclosure of mistakes. Providers were encouraged to look for clinical errors, fully reveal them to patients — and offer compensation when at fault.
Sounds like a recipe for more lawsuits, right? Actually, just the opposite happened. In addition, the time it took to resolve claims was reduced. Best of all, total liability costs went down. Full findings appear in the Annals of Internal Medicine.
According to Michael Houlihan, admitting to mistakes in a constructive way can actually help your firm gain respect and loyalty.
“You and your company are not judged by how well you do when you're good, but by how well you do when you're bad,” said Houlihan, who co-authored The Barefoot Spirit: How Hardship, Hustle, and Heart Built a Bestselling Wine. “The fact is, everyone — and every company — makes mistakes. Denying that they have happened usually exacerbates and magnifies an already awkward situation, because chances are, you aren't fooling anyone and you appear insincere.”
Houlihan offers five helpful tactics when it comes to managing mistakes:
Cop to it. Admitting to the mistake reduces its drama, and lets you move the next, more important stage: how you are going to address the situation.
Recognize how it happened. It's important that you look into how and why a problem happened. Doing so allows you to truly fix the faulty procedure or process.
Aim, don't blame. If it happened on your watch and you are accountable, the customer will blame you. So get to the bottom of what happened and aim your focus on what you and your company can do on your end to make sure it's a one-time problem.
Write it down. If you don't write down what happened and how to avoid it, the same mistake is more likely to repeat.
Resolve that it won't reoccur. Assure the injured parties that it — whatever “it” was — will not happen again. Voluntarily describe how the mistake happened and what changes you are implementing to prevent its reoccurrence. And most importantly, make it clear how you and your company are going to make things right.
Do these steps ensure you won't have legal or other problems to contend with later? Of course not. But they might prove to be a lot less expensive than simply sending in the lawyers.