The theme of the April edition of the Harvard Business Review is “Failure.” As scary as that term is in the world of compliance, “catastrophe” is even scarier. That means that the failure resulted is real, significant damage.
But you can learn from failures. You can especially learn from others’ failures.
In How to Avoid Catastrophe, Catherine H. Tinsley, Robin L. Dillon, and Peter M. Madsen look at “unremarked small failures that permeate day-to-day business but cause no immediate harm.” Their research has revealed a pattern: “Multiple near misses preceded (and foreshadowed) every disaster and business crisis we studied, and most of the misses were ignored or misread.” (Sorry, you need a subscription to read the entire HBR article.)
They come up with seven strategies that can help an organization recognize near misses and root out the error behind them. These seem very applicable to compliance programs.
- Heed high pressure. The greater the pressure to meet performance goals, the greater likelihood that managers will discount near miss signals.
- Learn from deviations. Don’t just recalibrate operations, focus on the significance of the change.
- Uncover root causes. Don’t just correct the symptoms.
- Demand accountability. Require managers to justify their assessments of near misses.
- Consider worst-case scenarios. people tend to not think of the possible negative consequence of a near miss. Walk through a situation where the near-miss does not miss.
- Evaluate projects at every stage. Take a look at your successful projects, not just your failures.
- Reward owning up. Don’t punish errors, but reward those who uncover near misses.
- Catherine H. Tinsley (email@example.com) is an associate professor at Georgetown’s McDonough School of Business, in Washington, DC.
- Robin L. Dillon (firstname.lastname@example.org) is an associate professor at Georgetown’s McDonough School of Business.
- Peter M. Madsen (email@example.com) is an assistant professor at Brigham Young University’s Marriott School of Management, in Provo, Utah.