The following is excerpted and adapted from my book, The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation. I admire the culture that KaiNexus leaders have been cultivating -- as with a garden, tending to the culture is a never-ending process.

As co-founder and CEO Greg Jacobson, MD, told me,

“You can’t have a culture of continuous improvement without learning from mistakes.”

What Are Mistakes?

Mistakes are actions or judgments that turn out to be misguided or wrong. We believe we are making the right decision at the time, but eventually discover it was wrong, whether seconds or years later. The word “mistake” is a noun. Mistakes exist, whether we recognize and admit them or not. After discovering a mistake, our choices determine if we turn it into something positive (learning and improving) or make things worse (dooming ourselves to repeating them).

We all make mistakes. What matters is how leaders react to them. Reacting in punitive ways just drives people to hide and cover up their mistakes. When that happens, we won’t be able to learn and improve. 

Our willingness to learn from mistakes, to choose improvement over punishment, doesn’t give people permission to be reckless. Psychological safety, learning, and problem-solving is the pathway to fewer mistakes. Punishment won’t get us there. Leaders can acknowledge when a mistake has a negative impact on a customer or our organization. We can contain the problem, apologize, and mitigate the immediate impact. My wife, as an executive, often tells people, “What happened is bad. But what can we learn and do to ensure it doesn’t happen again?”

Matt Paliulis, a co-founder and chief operating officer at our company, says, “KaiNexus hasn’t made any major mistakes, at least any existential ones. But we make a lot of little mistakes and learn, and that is why we are thriving.”

Demonstrating a Constructive Way at KaiNexus

Austin, a customer-success manager at KaiNexus, is appreciative of his colleagues’ reaction to a recent mistake. As he said in a weekly company meeting, “Everybody showed such grace. Everybody jumped in to help.”

At a customer’s request, Austin changed one of the templates they use in the KaiNexus software platform. Two weeks later, one of the lead users from that customer noticed that the template was now missing one of the necessary fields and reached out to Austin for help. Austin realized that he had made a mistake. “I was trying to do it too quickly and didn’t double-check my work,” he recalls. It’s OK. We all make mistakes, especially when under time pressure or otherwise rushing our work.

Austin reached out to the KaiNexus solutions-engineering team, explaining that he had caused the problem. He felt bad and feared there wouldn’t be an easy fix, resigning himself to the possibility that some customer data would be lost. Magdalen, a solutions engineer, was able to recover some of the data but needed additional help correcting the root cause of the problem. Adam, the principal software architect, diagnosed and fixed the problem within 30 minutes. Neither the mistake nor the impact was as big as Austin feared, as he had merely renamed a database field instead of deleting it. No customer data was lost.

The biggest takeaway for Austin was how helpful everyone was from the moment he admitted the mistake. Austin believes that, at previous blame-heavy companies, he would have been chewed out. He would have gotten help, but people would have made clear to him it was a burden.

Austin says the lack of punishment in this situation didn’t hinder his ability to learn. Even with a good outcome, he was motivated to reflect on the need to slow down and check his work. But it also reinforced that, at KaiNexus, admitting a mistake and asking for help brings a helpful, constructive response.

The same month as Austin’s mistake, I made a mistake, and the impact was mitigated by a kind response. Ten minutes before a webinar’s scheduled start time, Morgan, my KaiNexus co-presenter, had problems with her computer. Windows had decided to make updates that forced a slow and untimely reboot. She handled the stress well and found a colleague’s laptop to use. While we were able to start on time, I got thrown off track due to the scramble. I had failed to set the webinar to start recording automatically, and I forgot to click “Record”—a mental lapse. I lost track of my checklist at a time when I needed it most.

I learned this about 30 seconds into my welcoming remarks, when the other presenter (Greg, the CEO), sent a private Zoom chat message that asked, “Is this being recorded?” Oops! I disclosed the mistake to the audience and clicked “Record.” Had Greg yelled at me (which I would never expect), I would have been distracted the rest of the webinar, hurting my performance. But the kindness of his query allowed me to quickly put the mistake behind me. Thanks to the magic of editing, the recording shows no evidence of what went wrong. Morgan is now using a Mac, which has never surprised me with an inopportune update and restart.

Create Safe Opportunities to Practice and Learn

In Chapter One, KaiNexus co-founder and COO Matt Paliulis described a culture of learning from mistakes. As a web-based software company, one of the biggest risks they face would be an unauthorized incursion into its platform. Hackers try to get in through “phishing” attempts, tempting a KaiNexian to click a nefarious link in an email that looks legitimate. That mistake could jeopardize customer data, if not the future of the company.

To reduce the risk of damage, KaiNexus doesn’t rely solely on educating employees about risks and threats. Awareness helps, but they don’t hang up a bunch of posters or send Slack messages constantly reminding everyone to be careful.

KaiNexus pays a firm to perform occasional, unannounced “social-engineering-penetration tests.” Employees receive emails that might look suspicious to some, but no real harm comes from clicking the “bad” link. The firm also places phone calls to KaiNexians, pretending to be a customer (even using a real customer name).

Instead of just hearing about risks, active testing (and the risk of failing the test) is a more powerful way to learn. The company would rather have somebody make a mistake (and learn) through a test instead of an actual attack.

In these situations, covering up a mistake is more damaging than admitting it, so KaiNexus leaders, including Matt, emphasize that it’s safe to admit a mistake—whether one thinks it’s a test or not. In a recent company meeting, Matt explained it’s safe to come to him if somebody even suspects they might have clicked on a dangerous link. He emphasized that prompt reporting protects the company from further damage and won’t lead to punishment. Leaders like Matt are committed to acting in ways that are consistent with their words.

What Do You Think?

What's your reaction to reading a little bit about the culture of learning from mistakes at KaiNexus? What can your organization do to foster and cultivate this in your workplace?