Regrets, I’ve had a few and now it’s time to embrace them

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In his book The Power of Regret, Daniel Pink argues that we can enlist our regrets to make smarter decisions, perform better at work and in life and deepen our sense of meaning and purpose.

While there is virtue in positive thinking and a focus on what the future can offer, top organisations and individuals consistently analyse past performance. After sporting matches the coaching staff provide players with detailed performance analysis, including individual and team statistics, discussed individually and in team meetings. Video analysis provides more in-depth insights, reviewing mistakes to highlight areas for improvement.

Globally, airline crashes are virtually non-existent thanks to decades of analysis, re-engineering and improved practices, possible by the ability to review black box recordings after an incident or accident.

For the past year my personal daily practice starts with expressing gratitude and setting intent. Each evening ends with reflections on the day’s highlights and, finally, writing what I have learnt. The first three practices have been easy and natural but chronicling what I have learnt each day has not.

It is a lot like business. We are always setting our intentions and celebrating success but pay much less attention to what, if anything, we have learnt from our mistakes, poor decisions and failures.

When the University of Virginia’s Darden Business School introduced an executive MBA course two years ago entitled What I Might Have Done Differently, its lead professor, Greg Fairchild, said that this new class on failure analysis was immediately oversubscribed, suggesting that the demand is there.

Several years earlier I had worked with Darden on a teaching case study about our 2004 acquisition of Ground Control. Pivoting to a case study to teach MBA students about our failures was not nearly as fun, or ego boosting. I surveyed former and present colleagues for their thoughts and noticed a general discomfort with the exercise. Several shared regret over bad hiring decisions and the retention for too long of poor performers. One particular acquisition gained consensus, however, as something we might have done differently.

In gathering information for the case I was reminded of how great the deal had originally looked on paper. Taking over a profitable commercial roofing business in 2014 was an opportunity to expand our service offering, gain market share and grow top and bottom lines. We hoped to professionalise that service as we had landscape and winter maintenance, construction and tree work. We already served several of the same customers. More importantly, the roofing business had contracts and relationships with several of our large target customers.

What the investment memorandum did not show on paper we started to glean in due diligence. We chose, however, to ignore the incompatibility of their values and culture with our own and we broke our own rules because of the promise of the opportunity at a “bargain” price.

Acquisitions can be distracting but this one proved cataclysmically so because of internal fraud, poor behaviours and an inability to wrestle the business into professional ways of working. After five years of struggle, losses and profound unhappiness, we sold to new management. After three more years the business failed.

We learnt the hard way that you can change and improve almost everything in a business but it is really tough to change an embedded culture. This lesson has become a golden rule for future acquisitions.

As we were wrestling with the distraction and losses caused by that acquisition I organised a board retreat with an external facilitator. One of the exercises was about “prouds” and “sorrys”. Each of us wrote down and presented the top things we felt personal pride in, along with regrets that we had. It was an emotional session but proved to be a great experience for fostering humility and creating an environment for reflection, learning and improvement.

On another occasion we had a worrying increase in staff turnover and a poor employee engagement survey. We held a joint board-executive retreat to explore and understand areas of failure. That investment highlighted the need for a change in senior leadership, investment in company-wide management training and creating visible pathways for employee career progression. Because of this post-mortem we have been recognised by Great Companies to Work For on two occasions, the most recent giving a “World Class” rating.

The Power of Regret encourages these reviews after negative events or outcomes, embedding the practice of constructively discussing failures along with diarising individual time for daily reflection. It also suggests making a failure resumé, where you list your failures, your setbacks and your screw-ups in one column and list what you learnt from them in the second column.

Looking backward has moved us forward. I also believe that reflecting on my own personal and professional failures has made me a more humble and compassionate leader.

Regret can be a powerful tool for business leadership when used in the right way. By embracing regret we can confront our mistakes and failures, make more thoughtful and deliberate decisions and create a culture of continuous learning.