How to Make Mistakes the Right Way - FP Advance

How to Make Mistakes the Right Way

BY brett

How to Make Mistakes the Right Way | FP Advance

Prepare to be wrong

How do you deal with mistakes in your business? I mean the really big mistakes that probably have serious consequences for the business.

For example, a mis-click that buys the wrong investment for a client, costing them money. Or a mistake that has significant negative tax consequences for a client.

Most firms I know would like to think that they’ve taken steps to minimise mistakes, by designing good processes, hiring good people etc.

However, big mistakes are almost inevitable at some point on your journey, and so it feels appropriate to have a plan for how to deal with them. Praying that it never happens to you is not a plan.

Making a mistake doesn’t make you an unethical business. However, how you deal with the  fallout from a mistake might well push you into the unethical category if you’re not careful.

The starting point is to honestly assess your culture.

Do you want staff members to let you know of any big mistakes? If you answered ‘yes’, as I’m sure you did, does your culture make it safe for people to own up to their errors?

You can’t wish for your team to act this way, and then be a cranky sod or a bully.

A Whole-of-Business Response

Any plan for dealing with major mistakes should be driven by the whole business, not just solely dealt with by the individual who made the error. It’s important that the most senior and most experienced members of the team are involved in the response too.


Because you only get one chance to handle this right. If you inadvertently get off on the wrong foot with your response, you might never recover with the affected client. That could have serious reputational ripples out in the marketplace.

You’ve Got to Have a Plan

The next step in limiting damage is to create an agreed process that everyone on the team will follow if a mistake occurs.

In a recent edition of Bob Veres’ Inside Information, he related some of the planning done by Roy Ballentine of Ballentine Partners (a US firm), along with behavioural psychologist and business coach James Grubman. They have devised a programme called ‘A Proper Apology’, which forms part of the annual training for every member of the team, including all the executives.“The proper apology follows four defined steps:

  1. Report the mistake to management, so the firm can muster its resources and plan its response.
  2. Inform the client of the mistake and what you’re doing in response to it.
  3. If the client is harmed, make the client whole.
  4. After dealing with the immediate consequences of the mistake, engage in an analysis to figure out how to prevent a similar mistake from occurring at some point in the future.”

Ballentine says, “Team members learn in that training session, that if they follow our protocol, they have a very good chance of surviving even a serious mistake and possibly even flourishing afterwards. If they fail to follow the protocol, they will be removed from the team; and we explicitly state that during the training session, to make sure that everybody understands.”

Sounds fair enough, don’t you think?

The underlying principle here is treat people as you’d expect to be treated.

Process makes perfect

It all sounds simple enough. Yet how many times have you found yourself on the receiving end of a poor customer service experience, from a person or organisation that doesn’t seem willing or able to address the error head on?

To feel good at the end of the process a few things have to happen:

  • The mistake needs to be admitted and owned by whoever made it (person and/or organisation)
  • The mistake needs to rectified as far as that is possible
  • The person or organisation needs to take steps (and communicate them to you) that will prevent the same mistake occurring again

The last bullet point here is very, very important. If the offending person or organisation admits the mistake and makes it right for you, but doesn’t seem to do anything about preventing it happening again, there’s no rebuilding of trust.

Often a poor complaints handling experience occurs because of our need to be right. Don’t think this applies to you? Just check in with your spouse, partner or children. It affects us all to some extent and we need to be mindful of that in responding to our mistakes.

Teaching moments

All the value that can be derived from a mistake comes from the teaching moments or learning moments afterwards.

  • What does the mistake allow the team member/s to learn?
  • What does the mistake allow the business to learn?

If you can improve your team and your business off the back of a stuff-up, then you’ve got a better business.

Not only that, if you can handle the situation with a clear process that the whole team follows, you can even find that trust levels move upwards, beyond where they were before the mistake was made. High-quality mistake handling can even drive increased rates of referral from the aggrieved party.

Mistakes are inevitable. It’s how you deal with them that makes all of the difference.

What state is your mistake-handling plan in right now?

Let me know.

“Mistakes are inevitable. It’s how you deal with them that makes all of the difference. “


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ABOUT BRETT DAVIDSON When you work with FP Advance you work with me, Brett Davidson, directly. My motto is ‘advise better, live better’ and I practice what I preach. I’m straight talking and get to the heart of an issue quickly. There’s no beating about the bush, just a focus on helping things improve. Ask my clients – what I teach works.