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When the slick hits the fan: What we can learn from BP’s mistakes

We have all made mistakes at work, occasional slip-ups are unavoidable, but no-one wants to be responsible for them. Mistakes, even big ones, do not have to leave a permanent mark on your career. Looked at positively, mistakes can contribute to an organisation’s or individual’s learning; they are an essential component of experimentation and innovation. It is possible to recover gracefully and use the experience to learn and grow.

BP’s oil spill in the Gulf of Mexico has been an environmental, financial and personal disaster. President Obama has compared the 40,000 barrels of crude oil gushing daily into the Gulf, to 9/11, and by insisting on calling the company British Petroleum, he is completely disassociating the disaster from America, its deep-sea drilling policies and the US companies also involved.

The daily pictures from the Gulf meant BP could not talk down the rig disaster and the damning evidence of cost cutting, but the company’s leaders continued as before. CEO, Tony Hayward, said he wanted to reclaim his life (forgetting three people had died) and, under questioning in Washington, looked shifty while revealing himself as ignorant of things most people might have expected him to know.

Doing his best Liz Hurley impression, BP’s chairman, Carl-Henric Svanberg, jokingly called the victims of the Gulf spill, “small people”.

After their initial attempts of stuffing a combination of golf balls and rubber tyres down the gushing well, failed, BP revealed their new “dream machine”, 32 centrifugal units designed by none other than Kevin Costner. In words reminiscent of his seminal role in Field of Dreams, Costner said: “At its core, my dream, this machine, was designed to give us a fighting chance to fight back the oil that has got us by the throat.” Expectations are not high.

BP really does seem to have lost the plot.

After three weeks being mauled by the American president and Congress, Tony Hayward thought it might be a good idea to relax, watching his boat racing in the clear blue seas, off the Isle of Wight, in an event sponsored by a Wall Street Bank.

In retrospect, this was not a particularly good idea; he was slaughtered by the press at home and abroad, along with Rahm Emanuel, the White House chief of staff. Unsurprisingly, BP’s chief embarrassment officer has been relieved from frontline duties in America.

BP’s public relations team has proved itself titanically incompetent, but companies that get into this kind of trouble are generally revealing something about themselves, which they can usually keep hidden. Lehman Brothers had a terrible reputation for crude self-satisfaction as it headed to collapse and Toyota made its safety problems far worse with its initial reaction.

The common thread is the arrogance of success. Lehman’s Dick Fuld believed he had beaten his rivals and was master of his universe. Toyota believed it was the model car manufacturer. BP thought it was also a world-beater, previous ceo, Lord Browne a financial wizard and its transatlantic contacts unsurpassed. In all three companies we can see the brittleness that accompanies this arrogance.

It would be reasonable to expect such a giant firm to show a much higher level of competence, rather than letting a major accident turn into a public and political calamity. Given the importance of BP dividends (suspended) for so many pension funds, it is amazing nobody at the top of the company is being held to account and the company staggers on in denial.

Alright, so it is unlikely you are going to have to face up to an equivalent disaster at work, but how should you react once you have made a mistake?

Paul Schoemaker is co-author of Brilliant Mistakes and says that most people tend to over-react to their mistakes. He says: “They make asymmetric evaluations of gains and losses, so that losses loom larger than gains.” Consequently they tend to hide their mistakes, or carry on down paths that have proved to be unproductive. This “sunk cost fallacy” can be dangerous and expensive.

The trick is to accept your mistakes, to learn from them and move on. It’s hardly alchemy, but here some ideas to help turning your base mistakes into leadership gold.

Admit and acknowledge your mistake

It is crucial to be transparent and candid and to own up to an error. Do not blame other people (Halliburton anyone?). Even if it was a group mistake, acknowledge your role in it and apologise, without being defensive. How will this situation be remedied and what will you do to prevent it from happening in the future?

Once you have admitted your faux-pas, it may be possible to re-frame it, trying to get people to see it in a different light. Essentially, poor decisions or flawed processes can lead to mistakes, but it does not mean every bad outcome is a mistake. Look at internal and external influences; what was in your control and what was not? Without being defensive, explain what led to the mistake and help people avoid it in the future.

Change your ways

Mistakes are key to leadership development. Schoemaker says: “The best kind of mistake is where the costs are low, but the learning is high.” If this came about as the result of a poor decision, explain how you will avoid it in the future. You need to respond quickly, before people make judgements about your competence or expertise.

Showing that you have changed as a result of your mistake will reassure people that you can be trusted with equally important tasks or decisions in the future. Schoemaker says: “If you are going to pay the price for making the mistake, you need to get the learning.” This is easier in a learning culture than in a performance-focused culture, where mistakes are often treated more harshly. Whatever the office culture, you need to work out how to translate the mistake from a liability into an asset.

Rely on your support network

A strong support network can help. A healthy network has three components; authentic trusting relationships, a diverse range of perspectives and it is reciprocal. It is a good idea to ask current or former colleagues and friends for their views on the mistake and what they think you can do to recover. They will have some useful advice about how to frame the error and restore your reputation.

Get back on the bike

It can be hard to get your confidence back, but you should not let your errors make you afraid of experimentation. Once the mistake is behind you, focus on the future.

Mistakes are not signs of weakness or incompetence; recovery shows resilience and strength of character. Employers will look for people who have made mistakes and come out on top.

Not all mistakes are the same

Shoemaker says group mistakes are often easier to get over, because there is a diffusion of responsibility. Mistakes that have broken someone’s trust can have lasting consequences and contrition is critical; if someone has lost trust in you, you must offer them a sincere apology and be patient.

So here are some bullet point tips that the beleaguered Tony Hayward may like to jot down before he returns to the fray:

Do:

• Accept responsibility for your role in the mistake

• Show that you have learned and will behave differently going forward

• Show that you can be trusted with equally important decisions in the future

Don’t:

• Be defensive or blame others

• Make mistakes that violate people’s trust; these are the hardest to recover from

• Stop experimenting or hold back

On second thoughts, perhaps some mistakes are just too big and Tony Hayward and the rest of the BP board should just quit the stage and leave it all up to Kevin Costner.

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