People often ask me why I write and talk about CEO errors, mistakes and things that go wrong. It is because we all make mistakes, they negatively impact our entrepreneurial ventures, there are consequences and we need to try to prevent them and/or recover from them when they happen. Bad news is simply part of the CEO job. The CEO job in an entrepreneurial company is hard enough. You are trying to grow a company and business from scratch. Dealing with the bad news issues just makes it rougher.
As a five-time CEO, I can assure you that bad news comes with the job as CEO…it just does. And, my experience is that when bad news comes, it typically comes on a Friday or just before you leave for a vacation. So, as a CEO, you need to understand that dealing with bad news is a main part of the job.
But how do we deal with bad news and setbacks? Since we are going to face it regularly, it is essential to learn to deal with it when it happens.
One of my favorite philosophers, former boxing great Mike Tyson, says: “Everyone has a plan until they get punched in the mouth.” True. It’s how or if you get up off the floor once you have been knocked down that matters. Because we are all going to get knocked down. For instance, the big sales deal gets delayed or we lose it, financing does not come through, a key employee leaves, a customer cancels, the product does not work as planned, you cannot make payroll…. The list goes on and on.
But having or developing resilience is the key. Increasing your resilience can be hugely impactful on your performance as CEO. Improved resilience will reduce the symptoms of stress, improve productivity and creativity and allow you to better handle the bad stuff.
Webster’s Dictionary defines Resilience as “The ability to become strong, healthy or successful again after something bad happens.” And bad stuff happens to CEOs. In Mike Tyson’s definition, resilience is defined as how or if you will get up off the floor once punched in the mouth and knocked down. And we all get punched in the mouth (figuratively rather than literally).
There is a science behind resilience and there are 7 keys to resilience understanding and training. These are:
- Emotional regulation: Controlling one’s feelings in the midst of adversity to remain goal-focused.
- Impulse control: The ability to shut out distractions and urges to restrain knee-jerk reactions.
- Causal analysis: Identifying the causes of a problem or setback. Research has shown found that a non-resilient person gives up prematurely and fails to persevere, or else fails to cut losses.
- Self-efficacy: Developing confidence in one’s own abilities; having a sense of mastery and confidence when presented with challenges.
- Realistic optimism: Possessing a realistic belief that things can change for the better and that they can control their life’s direction.
- Empathy: Reading and reacting to others’ social and emotional cues. Resilient people can relate to others and use social networks to buffer against stress.
- Reaching out: Reaching out to others for help when under stress and pressure, enabling a person to seek out new challenges and relationships.
Anyone who knows me knows that I was traditionally not good at handling bad news. I am an emotional person and bad news has been traditionally followed by a destructive temper tantrum. Try not to be me. However, once I got over my emotional tantrum, I sought my own counsel and thought through how I would deal with the situation. I would think through 4-5 alternatives to the problem and choose the one that I thought had the best chance of getting the company through the bad news situation. This required time, patience and deep thought. You may want to skip the temper tantrum stage but work on the second part.
Here are some ideas to help you with dealing with bad news and improving your resilience:
- Prepare yourself. Think through possible bad news scenarios and how you will, first try to prevent them, but second, how you will deal with them if you can’t prevent them and they happen.
- Understand how others have recovered from similar setbacks.
- Have someone to talk to. As CEO, you often can’t talk about certain things with employees or even board members. Have a mentor to talk to.
- Have a hobby or some recreational outlet to help clear your head.
- Take a walk (again to clear your head)
- Take some time off (again….)
- Meditate if you can
- Talk to yourself. State the facts, understand the consequences and construct a new plan to recover from the setback
- Make sure that you get sufficient sleep
- Recognize that bad stuff happens to literally every early stage CEO. You are not alone.
- But you need to recognize that you own the issue of the bad news or setback and you have to learn to manage through these things.
For more information on how to be a better CEO, contact Arbor Dakota below. We are committed to helping CEO’s grow their great ideas into great companies.