Learning from the failure of others

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Some of the cheapest lessons small business owners can learn come from the mistakes of other people in leadership positions.  Even CEOs of major corporations can make mistakes despite all the resources at their disposal.  Tim Irwin, in his book Derailed: Five Lessons Learned from Catastrophic Failures of Leadership (NelsonFree), profiles six CEOs of major corporations who derailed in their leadership and ended up being removed from their positions.  These were very sharp people who made some serious misjudgements that cost their companies great sums of money and eventually cost them their jobs.  The one thing their failures had in common is that they came about because of a failure of character.  Irwin points out that it was not a character issue such as dishonesty but of being dismissive of others and hubris.  Their stories make interesting reading of how really sharp people can take the wrong road in their leadership and derail.  The second half of the book warns the reader how easily we can take the same wrong turns and how to avoid them.

One of the lessons Irwin points out is that "Derailment occurs over time - it really happens before the crash.  An ignored warning signal...the inattention to feedback, and one wrong turn leads to another."  I can relate to that because that is exactly what happened to me.  I failed to pay attention to the warning signals that could have helped me avoid having to close our business.  Too often, we think that failure is an event that happens, but failure is really the end result of a long list of issues we ignore over a period of time.

Another lesson we should take from this book is that most derailments are self-inflicted.  As I point out in my book Mistakes we can't blame anyone or anything but ourselves for our failures.  If your business fails you can't blame the economy unless every business failed.  We can't blame government because government never bailed out any small business.  It's not high interest rates, customers who won't pay their bills on time, the price of gasoline, or any other excuse people often give when a business fails.  While that business is failing thousands of others are prospering under the same conditions.  None of these things may have helped our situation, but the problems we are facing are nearly always due to our own decisions and habits.

As the author wraps the book up he points out that "While competence is absolutely essential, our character ultimately makes a greater impact on what we accomplish in our work and in our lives.  Character as expressed in authenticity, wisdom, humility, and courage must ultimately form the substance of who we are if we want to have great impact."  He ends the book by listing five critical habits every small business owner must develop to avoid derailment.

It is fascinating to read how six corporate giants could make such huge mistakes in their leadership, but it is humbling to realize how many of them we make in our own leadership.  This book provides you with an excellent opportunity to learn from the mistakes of other leaders so you might avoid them in your own business, and for the price of the book that is pretty cheap learning.