How Bad News Is Actionable And Wrong News Is Unacceptable

Of my nearly 30-year career, about 10 of it was spent directly leading a sales team. I ultimately owned the roll-up sales number, and the buck (literally) stopped with me. Just shy of 20 sales people (most well into six-figure earnings) were responsible for hitting their own monthly/quarterly/annual revenue targets, and the same was true of me to my leader. It’s a massive responsibility if you’ve had the role. To be crystal clear, sales management/leadership is not for the weak at heart. When your sales vice president reviews your forecast, you either have an iron-clad path to hitting your team’s goal (and a track record that assures her/him you’ll deliver), or you present a “gap closure” plan that pulls out all the stops, with Plans B/C/D/E/F and G. That’s your job: hit your revenue goal.

Here’s what I learned about holding sales professionals accountable, but the concept applies to every area in life: Leaders quickly learn to discern the difference between bad news and wrong news.

I’ve impressed upon each new sales team I lead (sometimes relentlessly, depending on their reputation) that my job as a leader is to handle bad news all day long. I know you can relate—I get about one piece of good news for every nine pieces of bad news, even in my current role. I’m paid to manage through bad news, not manage through good news. It’s rarely fun, but again, I know I’m hired and paid to solve problems and deal calmly and rationally with bad news.

During a leadership lesson I recently taped as part of the On Leadership series I host for FranklinCovey, I talk about the concept of “Making It Safe to Tell the Truth.” This is a situation when it really counts.

Leaders, especially sales leaders, must create a culture where your team can tell you the truth (about their sales forecast, the true viability of a deal, the solvency of a client’s finances to pay, etc.). If you, as a leader, aren’t approachable or are known to explode upon learning bad news, your team won’t tell you. You’ll still learn the same bad news eventually, just too late for you to make up for it somewhere else. I always told my sales team:

I want to be updated every step of the way (not on the small stuff), so I can understand if something’s going south or sideways. That way I will still have time to help you recover or, worst case, to pull other levers (Plan B-G) to make up for your loss. And by the way, I’m also going to call on you someday to make up for someone else’s loss—so always be prepared for that call.

Some leaders make the fatal mistake of intentionally creating a culture that boxes in your team members. There’s no out, and they must deliver—thus no bad news. This is a horrible strategy, as it creates a toxic environment: everyone hates their job, and your people will quit (and every company, especially your competitor, is salivating to hire your solid sales person). As a leader, you must cultivate safety in sharing the truth. That’s your job. “Tell me the truth, always, and please, I beg of you, early…as soon as you learn it.”

Now let me be perfectly clear: nobody should think for a minute that I accept calls from sales people telling me the deal is dead. You grossly underestimate my resourcefulness, ingenuity, and dedication to just let a client deal die because a sales person can’t see their way to the close. But by allowing bad news early, I am able to get involved sooner to coach them through client alternatives and likely save the deal. But as important, I can start building back-up plans with another client, deal, or sales person to cover the deal that’s softening.

In six years of one sales leadership role—that’s 24 quarters—I missed only one forecast or commit to my sales vice president, because I created a culture that allowed me to never be unintentionally screwed by late, bad news. I didn’t say I always reached my goal—I didn’t—but I nearly always delivered on my forecast and commit. In the rare times I missed, it allowed my leaders to search for other ways to meet goals. Shareholders like investing in companies who deliver on their commitments. And someday, I’m going to be grateful that my 401K and IRA were invested in those companies that did.

Now a quick primer on wrong news. This is pretty simple. Delivering to me wrong news means you’re not competent. Harsh, but true. If you tell me things that are incorrect or inaccurate, that means you haven’t done your job. You either guessed, lacked the skill or courage to ask the right questions, didn’t take the time to properly research of uncover all of the facts, were talking and not listening to the client, or as some sales people call it, had “happy ears,” where everything you heard validated your own false paradigm about the client’s needs or your deal closing on your own terms.

I have too many stories to share about a salesperson being convinced they were meeting with the decision maker, when in fact the real decision maker was one, two, or even three levels up, and there was no deal ever happening (don’t you just love uncovering that with one day left in your quarter?). Often learning the truth was just one question away with the client, but the salesperson was too scared to ask, “Can you tell me who is ultimately responsible for making this funding decision?”

Delivering wrong news to me means you’re not doing your job well. And when I learn your news is wrong (which is vastly different than bad), I’m going to be angry and frustrated with you, and my confidence in you will lower. This usually happens only once per person, and if the leader handles it well, the growth and maturity in the other person is palpable the very next day. I’ve witnessed overnight changes in people after leading a calm but clear “wrong news” intervention.

Although I’ve described this concept in a sales environment it’s replicable in project management, event management, product development, marketing, and more. It’s incumbent on you as a leader to accept bad news. You’re paid to fix stuff. But you can’t fix it if you don’t know about it. And if you don’t know about it—it’s likely your own fault.

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If you enjoyed this post, you may also be interested in FranklinCovey's weekly On Leadership series, where I interview authors and thought leaders to share their valuable leadership insights. Subscribe to FranklinCovey On Leadership and receive weekly videos, tools, articles, and podcasts to help you become a better leader.

Click here to watch the leadership lesson I referenced above, on making it safe for your team to tell the truth.

Click here to read my previous article on a simple trick that will make you a better listener - instantly.