Marketwired Blog

How to Maintain Morale after a Company Setback

By Kelli Korducki


Sometimes things just don’t work out. Whether this means that a project falls through or a business deal goes south, workplace disappointment is bound to happen to everyone.


For managers and business owners, handling setbacks the right way can be an opportunity for organizational growth; sometimes the lesson hard-learned is the lesson best kept. But reacting poorly can send morale down the tubes. This is especially true in a smaller company, where everyone in the office is likely to feel the ramifications of any given setback.


Leslie Caccamese, Director of Strategic Marketing and Research at Great Place to Work, a San Francisco-based human resources training and consulting firm, says the first step to bouncing back from a workplace setback is to focus on identifying lessons. She recommends organizations hold some kind of meeting or exercise after the event to figure out what went wrong and what can be done differently in the future.


“The idea isn’t to point fingers and assign accountability to who created the mistake, but to look at the situation and process it as a learning experience rather than a failure,” she says.


According to Caccamese, one trait that distinguishes a really great organization from average organizations is a willingness to accept the challenge of taking risks and learning from the ones that don’t pan out according to plan.


Caccamese cites one particular, large organization her company has worked with that bestows a “Red Pencil Award” (in honor of the red pencils teachers often use to highlight mistakes) upon the person who made a mistake that the organization as a whole learned the most from.


“There’s a little bit of a collective learning and processing that great organizations will go through when they experience a setback,” she says.


After the event has been processed, the organization can move onto morale-building exercises to build camaraderie. Caccamese suggests establishing a consolation prize like a team lunch, or offering some kind of communication from the top thanking people for their hard work and diligence. Keeping focused on the path forward, to success, is key; wallowing is not the answer, and neither is assigning blame.


“The conversation of how to do something differently or better should be very collective,” says Caccamese, adding that organizations should ask themselves: ‘How can we improve our approach for next time?’ instead of ‘Whose fault is it that we were not successful in pursuing our goal?’”


Caccamese also stresses the importance of cultivating a strong team with managers who encourage with positive reinforcement as opposed to fear. A unified, empowered team ensures quality control (as members of the group will look out for each other) while fostering a sense of solidarity that bolsters spirits.


“Negative behaviors spawn more negativity and don’t make people feel motivated to get out there and achieve more success,” says Caccamese. “So, anything that has to do with instilling blame or fear in people for what went wrong is not going to help you recover and get back on your feet.”

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