Many successful businesspeople know the value of moving on after failure. Sony started out making rice cookers that burned the rice. Evan Williams founded Twitter after iTunes made his podcasting platform Odeo obsolete. Henry Ford's first two car companies failed, leaving him broke.
Even the best leaders make the occasional misstep, but it's the way you respond after a mistake that determines the quality of recovery, said Ron Edmondson, a pastor and founder of Mustard Seed Ministry.
Jodi Goldstein, managing director of the Harvard Innovation Labs, said that one of the most important lessons she can teach her students is how to fail gracefully.
"If they want to be entrepreneurs, they have to learn [how to fail], quickly. We encourage them to fail early and often, so they learn the necessary lessons to innovate," she said.
If you've made an error as a leader, here are a few ways you can bounce back and recover from it.
1. Have a good attitude about failure. Failure is a learning process, but people often don't think about it that way, especially if they've been successful in life. However, failure can be just as valuable as success.
"Instead of decreasing your confidence and your feeling of your abilities, it should boost those. Those experiences make you a better entrepreneur," said Goldstein, who has 20 years' experience as a startup executive, co-founder and investor. Your attitude also influences how your subordinates handle failure, she added.
2. Apologize quickly and own up. Admit your mistake and look for solutions, said Edmondson. Don't make excuses or push blame unfairly onto someone else.
"You don't have to tell the world, but those who need to know should hear it from you and not from anyone else. This can't be done too soon," Edmondson noted in his blog.
As a leader, you also need to create an environment where it's also safe for your employees to own up when they fail. The best leaders take responsibility for the failures of their people, but that doesn't mean they shoulder unjust blame. Rather, they let employees accept responsibility for their particular mistakes and give those workers the opportunity to make amends. Leadership expert Thomas Cox advised, "Never shame anybody around failure. Treat them as primarily learning experiences."
3. Fix your failure. Don't leave the cleanup to anyone else, said Edmondson. You should be helping the team recover and find solutions.
"Do whatever you can to stop further damage from occurring," he said. "If there are financial issues involved, try to recover as much as you can. If there is collateral damage with relationships, apologize quickly and try to restore trust."
4. Analyze what went wrong. "Only by learning from the failure do you reduce the chances of repeating the same mistakes," said business coach Graham Gilley. "Full transparency will uncover solutions, understanding and commitment to change."
5. Move on. The worst thing a leader can do is throw in the towel after a failure.
"Think in terms of a sports coach. After a loss or setback, his/her team is looking for a signal or motivation to go forward. The leader/coach will determine any chance of recovery, more importantly, any chance of success," said Gilley.
What if the failure is so large that you lose your job? You can still move on to new and useful things. A study by Harvard Business Review looked at 450 CEOs of large, publicly traded companies who were ousted for failures. It found that 35 percent returned to an active executive role within two years, while 22 percent moved to advisory roles.
"When you show that you can still perform at a credible or superior level, others will begin to think of you as having the mettle to triumph over your career calamity," the article's authors wrote.
Jazz musician Miles Davis once said, "When you hit a wrong note, it's the next note that makes it good or bad." Business is much the same. Failures can cost you, but how you react to the failure — what note you play next — determines whether you and your business rise above the error.