Learn From Mistakes You Didn't Make
It's relatively easy to learn from your mistakes, but a CEO and his/her team should also learn from mistakes they didn't make. The team ought to occasionally review bad decisions that weren't made to not only reinforce your decision tree and the good decisions you have made, but also to understand what mechanism kept you from making a bad decision.
Highly effective teams regularly avoid bad decisions - there's a mechanism that keeps them from making bad decisions and they know what it is. They have a strict discipline by which they make decisions, checking off their list at each point along their decision tree.
Take the CEO Challenge. Deliberate with your leadership, or ponder it yourself, and then dissect what it was that made your last potentially bad decision not happen - was it consulting with someone who has more expertise in the area? Bringing in subordinates you wouldn't normally bring in? Was it bringing in a consultant? Consulting with a CPA or attorney?
Look at choices that weren't made, the sale that didn't occur, the merger or acquisition that almost happened, but didn't. Talk about great failures you didn't make. What was the trap door in the organization that caught you and kept you from heading down the wrong road? Something positive happened to keep you from making a bad decision.
Once you determine the triggering event, use it to develop a checklist by which all future decisions will be made. Your checklist should include questions such as:
• What's the worst thing that could happen? Can we live with that?
• What's the best thing that could happen? Is it worth it?
• Is this core to what we do and who we are?
• Does this fit within the strategic plan? If so, where? If not, why?
• If we don't do this, what's the worst that can happen?
There's a lot to learn from bad decisions you didn't make.
