My first lesson is the most powerful and hardest to master: Whenever you make a mistake (all of us do, and all of us will), be strong about acknowledging and correcting it. Whenever you take bold responsibility for your mistakes, you'll likely discover the opposite of what you may have expected: that people don't think less of you. Indeed, you may increase your credibility with every mistake.
When I first learned this many years ago, I was the editor of the magazine you're reading now, and that particular month it seemed like everything was going wrong: Writers were missing their deadlines, the production schedule was full of holes, two editors called in sick and the cover art wasn't working. Out of this perfect storm, we published a magazine with two notable errors.
In one, we transposed two digits on a mutual fund's performance numbers, effectively moving them to the bottom quartile from the top. In the other, we reported that a prominent advisor's office was 25 miles west of San Francisco. (Perhaps we could have joked afterward that he could walk on water!)
The writers we'd hired made these mistakes. Each of the articles had been edited by one of my senior editors and fact-checked by the proofreaders, and that was exactly what I was thinking as I walked down the hall to the office of the CEO of the company that owned the magazine. I desperately wanted to come out of this mess with my own credibility intact.
I could see he was angry as we sat down to talk. Yet I found myself, much to my surprise, taking full responsibility for the errors. I said I would call both parties involved and apologize, and ask them for proposals on how to fix the situation. While I couldn't promise there wouldn't be more mistakes in the future, I vowed that going forward they would have a much harder time getting onto the published pages of the magazine.
I also told him I had already contacted the company that printed the magazine and called back my column so I could rewrite it. I would apologize not just to the people affected by the mistakes, but also to the readers who'd seen the bogus information. My boss' anger turned to a kind of astonishment, and he seemed a little nervous when he asked if we really needed to bring it all up again.
From then on, my boss trusted me in a way that he never quite had before. Not only that, my editors and writers were grateful the hammer hadn't fallen hard on them. They trusted me more than they ever had, and they worked extra hard not to make me have to walk down that hall again.
After I wrote the new column, I got a lot of messages from readers saying they now trusted the magazine more than ever because they knew if we made a mistake, we'd fix it right then and there. Some said that was refreshing in a world where everybody else seemed to be covering their backsides.
I couldn't believe how it turned out; it seemed so counterintuitive. Mistakes had been turned not only into a learning opportunity, but also a chance to forge stronger and more trusting relationships.
If you take the opposite approach, your story might not end as happily. I remember a prominent advisor who managed assets for his clients using a complicated investment system. At the end of a year, his performance statements showed he was ahead of the market averages by double digits. In a letter to his clients, he talked about how this proved the superiority of his asset management systems and how he looked forward with confidence to the year to come.
Three months later, he was horrified: There had been an error in the previous statements. One fund's performance had been transposed on a spreadsheet as +26% instead of -26%. Once that was corrected, the advisor had actually underperformed the market slightly.
The advisor did not go to his clients with an apology. Rather, he redeployed their assets into a riskier configuration in hopes of making up the difference between what he had reported and the actual results. This proved not to be a great strategy for that subsequent year, so he doubled down again to try to catch up.