Business people have too often felt the pain, both personal and financial, of a business disaster. The reasons for failures are many and varied, and require a careful analysis to assure the don't recur. The problem then often moves from business analysis to decision paralysis. It can be very difficult to turn the page.
Moving on from disaster can be very problematic for many organizations. Often, the owner or CEO become defensive and decide and prefer to avoid risk. The failure to place the problem in the past, and look to the future, can often be a worse decision than the original crisis. It is important to remember that choosing to retrench, and even to do nothing, is a decision in and of itself. By keeping that fact in mind, moving forward can become an easier transition.
The effects on an organization, following a major disaster, are not always obvious at first glance. Very often, they are subtle and deadly. An examination of some of the effects of a mistake can help a company recover and return to success. Following the assessment of the damage and its causes, the next step is to chart a course for the future. This is not the right time to get scared of making any decisions.
One result of a mistake is a round of finger pointing and blame placement. This is not the correct approach to the problem. Instead of placing blame on a scapegoated employee, there needs to be a renewed emphasis on team building and internal company cooperation.
Sometimes, good decisions just go bad due to to timing, competition, or the industry health in general. Firing or demoting an employee for risk taking sends the wrong message to the rest of the staff. Creating a culture of covering up, keeping heads down, and risk avoidance is a recipe for business failure in the long run. Be sure to let your employees understand that risks are rewarded, and are seen as a step to future profits.
Another costly result is an exodus of good staff people. The round of resume circulations is often seen as result of the disaster. Instead, the employee turnover is a consequence of the blame game. No one wants to remain in an organization where any mistakes result in a one way trip to the company's Siberia. Risk takers should be praised for their creativity, and a series of pilot programs, periodic checkpoints, and research plans be developed to prevent future monetary drains.
A third result is often a concentration of decision making into the hands of the owner, CEO, or senior management. The company becomes more centralized with a deepening sense of two way mistrust and micromanagement. Instead of helping the company move forward, this approach is focussed on the past. A fear of mistakes paralyzes the entire company into inactivity. A steady erosion of market share is the all too frequent next step.
When a disaster strikes a business, it is important to turn the page. If employees understand that risk and mistakes are part of the overall success of the company, they will continue to develop new financial, marketing, production, and distribution plans. Creativity should be encouraged, and tightening the decision making screws won't get the job done.
If a disaster happens, turn the page and write a new chapter of company success instead.
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