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Business and government leaders will benefit greatly from showing genuine remorse when things go wrong, even if they aren’t personally responsible for a mess, says Arthur D. Collins, Jr., former chairman and CEO of Medtronic. He is now managing partner at Acorn Advisors, which consults with nonprofits on strategy and governance, and also a board director at Boeing, Cargill and U.S. Bancorp. At the same time, Collins adds, leaders who fail to offer timely apologies — or shift blame to others — lose respect and credibility for themselves and their organizations. He detailed the power of an honest apology in an interview on Knowledge@Wharton’s SiriusXM show. (Listen to the complete podcast above.)
Below are select takeaways from his interview:
Why the Honest Apology Works
“Everyone understands that whether you are a CEO or a leader in some capacity, or even the President of the U.S., no one is infallible and everyone occasionally makes a mistake or misspeaks,” said Collins. “But surprisingly enough, it’s more of a rare occurrence when leaders own up and say, ‘Listen, I’m sorry.’” He added that examples abound where an honest apology has enhanced a leader’s reputation, noting that it works the other way if a leader doesn’t apologize or apologizes in the wrong way.
Waiting to Apologize Could Be Costly
According to Collins, “unfortunately, many politicians and many leaders in business think that apologizing is showing some sign of weakness, or that an apology will get them into water that is much hotter than they are in at the time that an apology is needed.” In fact, they must be quick with their apologies, he advised. The longer one waits and the less one is willing to step up and admit a mistake, “the more damage is done to the individual, and in many cases, to the organization that leader represents.”
How Taking Personal Responsibility Helps
Collins cited Johnson & Johnson’s response during the Tylenol contamination incident of 1982 when then CEO James Burke took personal responsibility for an unknown saboteur’s work, launched a nationwide recall and returned to market with tamper-proof packing to reclaim and strengthen the company’s reputation. Collins also praised General Motors CEO Mary Barra for apologizing in 2014 in the case of faulty ignition switches. “She did it in a very specific way: It was timely; she showed genuine remorse for the resulting injuries and any lives lost, and she came out of that in a much better situation.”
Where Not Owning Up Backfires
Collins contrasted the responses of Burke and Barra with that of Uber co-founder and former CEO Travis Kalanick. Earlier this year in a note to employees, Kalanick said that he needed to “fundamentally change as a leader and grow up” after a video of his exchange with an Uber driver went viral. That apology came after multiple instances put the spotlight on Kalanick and Uber more generally as fostering an inappropriate corporate culture. Kalanick’s apology “didn’t satisfy his upset customers, and ultimately his board of directors removed him as CEO,” Collins noted.
“It’s better to get whatever facts – good or bad – out early because what you never want to get accused of is selective and partial disclosure and ultimately a cover-up.”
Collins recalled how dodged apologies in two cases involving oil spills – Exxon Valdez in 1989 and Deepwater Horizon in 2010 – proved costly for CEOs. Exxon’s then CEO Lawrence G. Rawl “was criticized and deserved criticism” because he waited six days to speak on the disaster and then “tried to justify the company’s actions while declining to take personal responsibility,” he said. In the Deepwater Horizon case, BP chief Anthony Hayward was criticized for “for showing little compassion and being late to the party,” Collins said. He cited Hayward’s troubling statement, “There’s no one who wants this over more than I do. I would like my life back.”
Collins also cited as unhelpful the response of Michael Horn, the CEO of Volkswagen Group of America, in 2015 when a scandal erupted over the company’s faking of emissions tests. Horn blamed a couple of software engineers for it, saying they acted on their own. “I don’t think you want to roll the dice on something like that,” said Collins. “It’s too important to the reputation of an institution, corporation or government. It’s hard over a number of years to build a reputation; those reputations can be lost fairly quickly.”
Don’t Cover Up, and Provide Fixes
What gets individuals and institutions in trouble many times is not the act itself, but the alleged cover-up, said Collins. “It’s better to get whatever facts – good or bad – out early because what you never want to get accused of is selective and partial disclosure and ultimately a cover-up.”
Collins said it is also critical to say why a certain problem won’t recur. “An apology that simply recognizes the problem but isn’t responsive in terms of what is the action plan to correct what went wrong, and to make sure the same problem doesn’t occur again, does not result in an honest and an appropriate apology,” he said.
Preparing for an Apology
Typically, top managements at companies don’t discuss apologies in the abstract, but a crisis forces them to decide how to respond and communicate in a timely, honest and open manner, said Collins. In such situations, boards of directors at companies could step in to ensure such communication, since they have a long-term perspective on the health of the institution. Such responses “should be ingrained in training” such as in disaster management exercises at companies, he advised.