Hands On: Budgeting for Blunders
Before Lisa Hickey launched her Boston-based ad agency, Velocity Inc., her mentors had warned that she'd make costly mistakes in the process. Recalls Hickey, "I thought, 'I've got to plan for that." So she set aside $10,000 to pay for errors. The fund isn't meant to finance sloppy mistakes; it's strictly to support creative risks. For example, an employee suggested trying an innovative printing process on a client's brochures. When the process failed, Hickey had to reprint the brochures at her own expense. "Normally, I would say, 'Where am I going to get $3,000?" she says. This year she's upped the mistake budget to $15,000. As her company grows, she expects to take bigger risks -- and, occasionally, experience bigger failures, too.
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