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Leadership Means Owning a Bad Decision

We all make bad decisions during the course of a career. The critical part of a bad decision, however, is how you react to and learn from the decision.

If one is able to respond accordingly, then a bad decision is a powerful opportunity to use leadership skills effectively and move on quickly. To do so, however, requires you to be accountable for the decision. Business leadership means owning a bad decision. Below are 6 ways to own and grow from those decisions.

1. Be Responsive
There’s a concept in economics and accounting called sunk costs, which refers to the already spent dollars and time invested in something. When we’ve already invested lots of dollars in a project, purchased stocks that just aren’t performing, or hired and trained an employee who isn’t working out, the first instinct may be to hang on to that investment, hoping it will pay off.

However, when you realize that you’ve made a bad decision, the best thing to do is to act quickly. For example, if you spent a lot of political capital in advocating for a new product suite that isn’t selling, you may be inclined to hold out hope and push for a new sales or marketing strategy. But if the writing is on the wall, the best thing may very well be to accept the mistake and move on.

2. Find a Solution
A bad decision does not need to be fatal. Remediation, in the form of a performance improvement plan for an under-performing employee or a new social media strategy to target Millennials for a newly launched product might be just what’s needed. Pointing out problems is easy. Pointing out solutions is the hard part.

Taking responsibility for a decision, regardless of the outcome, shows effective leadership.

3. Take Responsibility
If you were the passionate advocate for the project that bombed, the last thing you want to do is start pointing the finger at a colleague or subordinate. Instead, own up to the decisions that were made. Doing so shows others that you are responsible and accepting. Simultaneously, it opens the door for self-reflection and organizational reassessment.

4. Learn a Lesson in Effective Leadership
The best bad decisions are those that we learn from, making sure we extract the practices to avoid in the future, refine our focus as needed and appreciate the insights gained. When such an approach is used, a bad decision turns into a valuable lesson.

5. Share Insights
It’s human nature to want to move on quickly from painful or difficult issues and bad business decisions are no exception. However, sometimes the best thing to do is to make sure that you analyze what happened and share what was learned with employees, supervisors, trusted colleagues, and family and friends.

Taking responsibility shows transparency and business leadership. Sharing and listening to others’ observations can provide even deeper insights and help you learn even more.

6. Refocus Your Energies
Dwelling too long on a bad decision is not a good idea; you need to forgive yourself and move on. Take the lessons learned and insights gained to refocus your work on new projects.

Effective leadership comes from those who understand that we will all make poor decisions. Trailblazers who gain perspective and learn lessons from their own mistakes and do not let a bad decision define their, or their organizations’ future are not only effective leaders, they tend to become more accomplished over time.