SHOULD BUSINESS LEADERS APOLOGIZE? WHY, WHEN AND HOW AN APOLOGY MATTERS
by Linda Stamato
Leadership |
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Contrition can help a leader and an organization move on. Surprisingly, however, an apology may not always have the intended consequences. This author describes the requirements for an apology to be effective and discusses how it can improve business operations, interpersonal relationships and employee morale.

Like governments, religious institutions, and even celebrities, a number of CEOs in the past few years have found it appropriate to issue a public apology. They have asked both clients and investors (and in some cases, their families) to forgive them for a variety of reasons ranging from criminal actions to moral lapses and even to failed corporate performance.

What are we to make of this? Quite a lot, since apologies can create the conditions for constructive change. It seems both timely and appropriate, then, to ask what role an apology can play in business life. This article will seek to answer this important question. As the reader will discover, issuing an apology is rarely a simple matter.

The role of an apology

An apology can acknowledge that an injury or damage has occurred. It may include acceptance of responsibility for the mistake; express regret, humility or remorse in the language one chooses; explain the role he, she or they played; ask for forgiveness; and include a credible commitment to change or a promise that the act won’t occur again. Often, the apology will tender some form of restitution or compensation.

The scope and depth of apology have few limits. It can serve as a personal expression of remorse, of course, but it is also a condition for peace, an instrument of policy, a legal remedy, and an acknowledged requirement in a system, say, in which victims and offenders, in prison settings, or, as in South Africa, before a reconciliation commission, seek “restorative justice.” But, it means different things in different places and that fact particularly, complicates its efficacy across cultures; differences in culture and politics affect its meaning, value, function and efficacy.

As a catalyst for change, an apology can be instrumental. When the Irish Republican Army, for example, offered its “sincere apologies” for civilian deaths during its 30-year campaign, it acknowledged responsibility for unintentional deaths and injuries, for the grief and pain of relatives, and offered condolences to family members, at the same time that it committed itself “unequivocally to the search for freedom, justice and peace in Ireland… to the peace process and to dealing with the challenges and difficulties which this presents. This includes the acceptance of past mistakes and of the hurt and pain we have caused to others.”

This unanticipated and unmitigated apology was received as an act to signal normalization, to herald a new attitude, to set the stage for peace. And it did.

The business culture and apology

Perhaps the most active research on the meaning and efficacy of apology appears to be in law and business contexts, primarily because of the legal and financial implications of apology. But there are practical, organizational issues that are important too.

Apology and policy

An apology can serve to strengthen an organization. A CEO, for example, apologizes to indicate that she cares to make things better and will try harder, and that she is secure enough to acknowledge that she isn’t perfect. Such admi8ssions encourage managers to admit when they’ve made mistakes and to make every effort to right them.

An apology can also serve to rebuild lost consumer trust. Certainly David Neeleman, chairman of Jet Blue, was attempting to do just that in his letter of apology to those ill-served by the air carrier during the havoc of the winter storm in 2006:

“Words cannot express how truly sorry we are for the anxiety, frustration and inconvenience that you…experienced…This is especially saddening because JetBlue was founded on the premise of bringing humanity back to air travel, and making the experience of flying happier and easier for everyone who chooses to fly with us. We know we failed to deliver…

We are committed to you, our valued customers, and are taking immediate corrective steps to regain your confidence in us. We have begun putting a comprehensive plan in place to provide better and timelier information to you, more tools and resources for our crewmembers and improved procedures for handling operational difficulties. Most importantly, we have published the JetBlue Airways Customer Bill of Rights – our official commitment to you of how we will handle operational interruptions going forward…”

Neelemen demonstrated a key element in effective communication when he stepped up and spoke for himself—for the organization he leads—and not through a surrogate: He took the heat. His company’s reputation, its very viability, was at risk. Handling this risk required him to acknowledge mistakes as he sought to garner support for his efforts to make things right.

Questions of timing are critical. The longer it takes a business leader or a section manager, for example, to acknowledge his or her mistake, the more likely the undecided folks will turn against him or her. Business leaders need to understand that if, in the end, it is going to be disclosed that they have erred, it’s better to own up as quickly as possible in order to have a hand in making repairs.

Apologizing by admitting a mistake—to co-workers, employees, customers, clients, the public at large—tends to gain credibility and generate confidence in one’s leadership. Acting defensively, on the other hand, undermines it. Credibility requires that an apology be immediate, unforced, sincere and specific in terms of what exactly one did that was wrong and who specifically has been hurt (or what process flawed or product or service affected).

To acknowledge a mistake is to assert secure leadership; to take responsibility and prescribe a corrective course of action is wise management. Taking responsibility for an error earns the privilege of being forgiven, and thus granted a second chance. Employees may well be relieved—after all, who has not made a mistake?—and more willing to help make the corrective action work better (fly the airline; improve the production line; plan the sales pitch, and so on).

Still, there are complicating factors. Georgetown University researcher and linguistics professor Deborah Tannen, for example, notes that apologies tend to be regarded differently by men, who are more likely to focus on the status implications. Many men avoid apologies because they see them as “putting the speaker in a one-down position,” or, diminishing the speaker. She concludes that those who caution managers not to undermine their authority by apologizing are approaching the interaction from the perspective of a power dynamic. While she found that this strategy can be effective, she also found that people feel frustrated in their jobs when they work with or for someone who refuses to apologize or admit fault. In Tannen’s words, “accepting responsibility for errors and admitting mistakes may be an equally effective or superior strategy in some settings.”

Not all mistakes require an apology, but when the stakes are high, it’s better for a manager to seize the opportunity to right things, to offer a sincere apology and face up to the error, not hide behind a spokesperson or shift the blame to someone else (or forces beyond his or her control). Perception matters. So does conviction and passion.

Advice on this point can be summed up as follows: Communicate that you are not just unhappy with your performance but that you are grossly disappointed by it. State as well that you are determined to make sure “it” doesn’t happen again and indicate what you’re going to do to be sure “it” doesn’t.

In short, there is value in taking the hit: “I’m responsible, I’m sorry. Here is what we’re going to do to make things right.”

Apology and customer satisfaction

Effective business apologies are becoming a cornerstone of customer satisfaction, trust, loyalty and retention. While companies hope to maintain high standards in regard to the products and services they offer, mistakes can be made and some people will inevitably be disappointed about something.

How employees, managers, and executives handle mistakes has a direct impact on how customers feel about the company’s staff, product and service. One could argue that by extending a credible apology for the right reason in a timely way ought to become a standard component of any company’s customer care policy.

The most important remedy (after getting the problem fixed) is for a company to acknowledge its responsibility. Most customers just want an explanation, some assurance, an apology, or a chance to vent, according to results from the Customer Rage Study. (The 2004 National Customer Rage Study, conducted by the Customer Care Alliance in Alexandria, Va., in collaboration with CSL, a national survey of 1,000 U.S. consumers).

It is important to anticipate mistakes and errors when developing best business practices, precisely because there is a chance they will occur. In a counterintuitive fashion, perhaps, failures can improve and strengthen customer loyalty and satisfaction—which translates into welcoming the occasional failure as a business opportunity.

The value of apology

A well-crafted, correctly issued apology can enhance a company’s reputation. At the same time, it can also build trust, satisfaction, and customer loyalty. From this perspective, a business cannot afford to ignore failures and avoid apologizing.

That is not to say that apologizing is easy. In Western business culture, admitting mistakes is not routine by any means; ambivalence abounds. Apologies can be valuable, though, because making mistakes—and recognizing and acknowledging them—may serve as necessary learning tools. Paul Schoemaker, co-author of a June 2006 article in the Harvard Business Review, “The Wisdom of Deliberate Mistakes,” argues that there is too much focus on outcome rather than on process, and that if businesses and people are not making a certain number of mistakes, “they’re playing it too safe.”

Taking risks, and risking mistakes, may well be essential to progress. It’s what we do about the mistakes we make, however, that matters.

That test may come quickly in China. Consider, for example, the recent apology by the Hong Kong company that manufactured millions of poisonous toy beads in mainland China. The toy heads had an ingredient in the glue used that, if ingested, could lead to serious illness; indeed, 14 children became sick and several were briefly in comas. The chairman of JSSY Ltd., the manufacturer, had the following to say:

“Our apologies to all the children who ate the beads by accident, and their parents and overseas consumers. We apologize for all the negative effect caused by this incident to China manufacturers. We apologize for the negative effect on ‘Made in China.’”

This statement may not go as far as Western observers like in order for it to be convincing, but certain cultural perspectives are in play. In China, apologies are complex matters, weighty acts that are rarely offered or accepted and must be delivered in just the right way, with appropriate gravity. Apologies require a great loss of face, and face is not something easily offered. (And often the passive tense is used indicating, to Western ears, a certain distance, a lack of responsibility, even insincerity).

Chinese scholars suggest that the Western penchant for apologies grows out of the Judeo-Christian tradition, in which a simple confession brings prompt absolution. In contrast, an apology in China involves a much more formal and traumatic event.

It’s not surprising then to see what happened when Mattel Inc. blamed Chinese manufacturers for its recall of 20 million toys that were made there in late 2007—three high-profile recalls including Barbie doll accessories and toy cars because of concerns about lead paint and tiny magnets—by saying that certain vendors in China or their sub-contractors violated Mattel’s rules by failing to use safe paint or to run tests on paint. The Chinese were incensed and said so. As a result, Mattel retracted its statement and dispatched leaders of the company to China to try to save face, taking the blame for the recalls itself.

Mattel’s executive vice president for worldwide operations, Thomas A. Debrowski, stated, in public, to Li Changjang, China’s product safety chief, the following:

“Mattel takes full responsibility for these recalls and apologizes personally to you, the Chinese people, and all of our customers who received the toys… the vast majority of the products that were recalled were the result of a design flaw in Mattel’s design, not through a manufacturing flaw in China’s manufacturers.”

Li responded in a way that upbraided Mattel for maintaining weak safety controls and reminded Debrowski that

“…a large part of your annual profit…comes from your factories in China… I really hope that Mattel can learn lessons and gain experience from these incidents … Mattel should improve their control measures.”

Given how heavily invested Mattel is in China and given the increasing global reach of that nation, we may well see less resistance to the use of apologies for errors in parts and products manufactured for export (for strategic reasons at least), and more attention focused on improving the manufacturing process, at all levels.

Genuine apology

Beware, however, of the “non-apology” apology. The other meaning of apology, i.e., a justification or defense of an act or idea, from the Greek apologia, raises the critical issue of sincerity. An effective apology does not seek to excuse – to explain, perhaps, but not to dodge responsibility.

Apologies that rationalize behavior are often those that are forced by a settlement. Consider, for example, the apology given by Dick Strong, the founder of the Strong Fund. His apology, (and exit from the head of the firm, along with a payment of $175 million in civil penalties) ended his dispute with regulators who charged the company with market-timing trades in order to lure other business when his hedge fund was in trouble. He acknowledged that he made market-timing trades on behalf of himself, his family and friends while misleading others who consequently lost considerable sums. His apology was not well-received. Observers saw that the apology was forced, insincere and, ultimately ineffective, as Chuck Jaffe, a senior columnist for CBS Market Watch, reported in 2004.

Recently, in another context, a blogger, Ruth Sherman, analyzed the apology offered by Steven Jobs, founder and CEO of Apple, and found it wanting. Recall that Apple reduced the price of its highly touted, long-awaited I-phone by a third only a little over two months after the phone first came to market. This is the phone the company hyped for one year, so successfully, in fact, that people camped out overnight and waited in lines for a chance to be one of the first to own one.

And, since this is the company that rarely discounts its products, customers who had purchased the phone for $599 could legitimately feel a sense of betrayal when Apple made its unexpected announcement that the phone would henceforth cost $399. For taking that action, and disappointing so many of its loyal customers, Jobs apologized.

Though Jobs subjected his apology to her standards for an effective apology—accept total responsibility; accept your fate; deliver the apology believably—Sherman found that it failed on all counts. What follows is her take on events and her assessment of the apology:

Apparently, the emails poured in and Steve Jobs and his marketing team knew they had a problem. So they sprang into action and posted a letter to the Apple website. After several paragraphs making the business case for the price cut, the one line that has any meaning appears: “Our early customers trusted us, and we must live up to that trust with our actions in moments like these.” It’s the only line with any heart.

But if actions speak louder than words, then Apple’s attempt at mollifying irate phone owners was a dandy. Apparently “living up to that trust” means a $100 store credit. Some people were placated, but others felt used and let their feelings be known. As one irate customer put it, “I was a $200 phone beta tester for Apple.” This could have something to do with another line in the letter that really gets to the crux of things: “This is life in the technology lane.” BAM! Any hope an early phone customer might have had that Steve Jobs felt their pain was wiped out. He might as well have yelled, “Suckers!”

This is known as the “Sorry, but” form of apology. “Yes, we admit it, and we’re sorry but you were stupid to think we wouldn’t” or some other form of blame-the-victim.

According to the “rules” for apology I laid out last week, Apple and Jobs failed at every, single one…

Bottom line, Apple screwed its customers that it professes to value so highly. And its efforts to make amends are half-baked, at best. This is not leadership in my book and it certainly doesn’t pass for an apology.”

Apologies that don’t pass the credibility test could prove to be counterproductive and set back efforts to restore customer loyalty and attract new customers and clients.

Apology and the law

As a legal remedy, apology introduces empathy and compassion in an effort to take the insult out of the injury or, in other words, to separate the harm from the liability. Apology—asking for it, giving it, getting it, accepting it—can be one of the more profound interactions between human beings, transforming hurt, anger and a need for revenge into a desire to make amends.

If society can move beyond the notion that an apology signals “weakness” and projects a level of liability, it may become even more widely used. Some argue that it is time for an “apology privilege” to allow people who want to apologize for a legal harm to do so without the apology’s being used against them later. Just as public policy encourages the repair of dangerous conditions and justifies excluding evidence of post-accident repairs in tort cases, so too, a public interest in raising the level of social harmony and cooperation and lessening unnecessary litigation might support the implementation of a rule barring the admission at trial of apologies earnestly made after the commission of a wrong.

Apology and medical practice

When it comes to medical errors or shortcomings, moreover, apologies are compelling. Research suggests that if doctors are candid about errors, patients feel better about them and are no more likely to pursue legal action than they are when doctors do not take responsibility. Doctors who admit to making mistakes are viewed more favorably, and some research would suggest apologies and restored relationships can improve medical care.

Fear of lawsuits may be a driver behind the pattern of not acknowledging responsibility or fault, but as Richard Friedman, M.D (“Learning Words they Rarely Teach in Medical School: “I’m Sorry’,” New York Times: July 26, 2005) points out, there is very little in medical school teaching or residency training programs that tells doctors what to do when they make a mistake. This pattern may be changing. While there is concern about the deaths each year in hospitals from preventable medical errors, there is little said about how doctors should deal with the patients they have visited errors upon. An apology can humanize and build trust. As Friedman put it “In the end, most patients will forgive their doctor for an error of the head, but rarely for one of the heart.”

Research on apology

Despite the role that apologies can play, and the almost daily news reports of the latest celebrity or political apology, there is a surprising dearth of systematic empirical research on the subject.

Two exceptions are the books On Apology by Aaron Lazare, and The Five Languages of Apology by Gary Chapman and Jennifer Thomas. The consensus emerging from these sources is compelling: To apologize means to acknowledge that hurt or damage has occurred. One must accept responsibility for the mistake; explain the role he or she played; recognize regret, humility or remorse in the language one chooses; ask for forgiveness; and include a credible commitment to change or a promise that the act won’t occur again; and, often, tender some form of restitution or compensation.

Aaron Lazare, dean and chancellor of the University of Massachusetts Medical School, spent more than a decade studying apologies; his book, published in 2004, includes more than 100 case studies. Lazare posits four stages that are essential to an apology’s effectiveness: asking for and giving it; accepting it; restoring the relationship, and/or educating for change.

Last summer, colleagues associated with the Harvard University Project on Negotiation, taking note of the unusual number of public apologies, offered their take on what constitutes an effective one: It should be clear and specific, personal, visible and direct, non-defensive and genuine. It must also be accompanied by action.

Guides for apologizing

Several authors offer guides for apologies, none more engaging than that offered by Jay Rayner in Eating Crow, a novel in which the protagonist, Marc Basset, a pitiless restaurant critic, writes a devastating review of a celebrated chef who promptly commits suicide and causes Bassett to do something he has never done before – apologize. He is euphoric as a result of receiving the widow’s forgiveness and absolution and so, in an effort to maintain this newfound state of bliss, Basset decides to apologize to every person he has ever wronged. As his mollifying power spreads, he is tapped to become Chief Apologist for the United Nations, traveling the globe to apologize for everything from colonialism through exploitation to slavery.

As is frequently the case when a condition or event becomes the subject of comedy, it is serious indeed.

Accordingly, Rayner offers, via his alter ego, the following laws:

  1. Never apologize for anything for which you are not sorry
  2. Never apologize for anything for which you are not responsible
  3. Only apologize to those who have suffered the hurt or their legitimate heirs
  4. Never link the wording of an apology to the shape, scale or form of any settlement that may follow
  5. Never blame others

It is difficult enough for an individual to apologize for his or her own actions. It is even more daunting for a corporation or an organization to give a meaningful apology—to project deeply felt conviction and remorse. Still, the experience in other domains suggests that there are ways to do so with good effect. Apologies may prove to be essential—in operations, customer and client relations and, generally, to maintain public regard—and they may be expected, increasingly, as more public apologies are made.

Failing to meet expectations can be costly; dealing with genuine—and perceived— shortcomings require action. Accordingly, business leaders need to fully appreciate the need for, and how to construct and deliver an effective apology.

Conclusion

To apologize is to comprehend and acknowledge one’s error, to act justly; it requires that the truth be told without minimizing or rationalizing the behavior. This burden suggests the full measure of an apology’s potential—its power to get beyond the past in a manner that allows for reconciliation provides a means to make things right and that restores, even enhances, relationships.

The interest in the public expression of apology and the increasing frequency of its use suggests that we need to get to know a good deal more about it. One thing seems quite sure, though, and it is this: What makes an apology matter is where it leads, what it generates, what, in the final analysis, happens as a result. The author and theologian Tryon Edwards, has it just right: “Right actions in the future are the best apologies for bad actions in the past.”


References

On Apology, By Aaron Lazare, (Oxford University Press, 2004).

Five Languages of Apology, By Gary Chapman and Jennifer Thomas (Moody Publishers, August, 2006).

Eating Crow: A Novel of Apology, By Jay Rayner, (Simon and Schuster, New York, 2004).

From Apology to Utopia: The Structure of International Legal Argument, By Martti Koskenniemi (Cambridge University Press, 2006, 1989).

Transitional Justice: How Emerging Democracies Reckon with Former Regimes, By Neil J. Kritz, editor (United States Institute of Peace, Washington, D.C. 1995).

Law and Social Inquiry, “Law and Lustration: Righting the Wrongs of the Past” (Volume 20, November 1:University of Chicago Press, Winter, 1995).

Harvard Business Review, “The Power of Talk: Who Gets Heard and Why:” Deborah Tannen. (September-October, 1995).

The New York Times: “Learning Words they Rarely Teach in Medical School: ‘I’m Sorry.’” Richard Friedman, M.D. (July 26, 2005).

Alternatives: “Encouraging Apology Improves Lawyering and Dispute Resolution,” Jonathan R. Cohen (Vol. 18, No. 9: October, 2000).

“The Art of Public Apology,” Patrick Field, May 2, 2007, www.cbuilding.org.

Ruth Sherman • Ruth Sherman Associates, LLC • Greenwich, CT • www.ruthsherman.com: Posted by Ruth Sherman at September 11, 2007 10:20 AM | Topic: leadership |

The Author:

Linda Stamato

Linda Stamato is Co-Director of the Center for Negotiation and Conflict Resolution, and a member of the graduate faculty at the Bloustein School of Planning and Public Policy, Rutgers University.



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