Everyone's a Critic

Most bosses can dish out the criticism. Here's how to take it.

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Nothing used to annoy Christine White more than a complaint from an employee. The owner of Boudoir Baskets, a Web-based retailer of lingerie and other romantic accouterments in Santa Clara, Calif., was convinced that no one knew her business the way she did. Even as her company grew to 20 employees and White relinquished more of the day-to-day responsibilities to focus on larger, strategic matters, she had a hard time accepting that her sales reps might possess greater insight into her products and customers than she did.

So two years ago, when a sales rep told White that he had concerns about a new product, she was not inclined to listen. The device, he said, was shoddy and broke easily. White had already stocked her warehouse with the item. If she'd made a mistake, it would cost thousands. It's a great product. I got a great price from the manufacturer, she thought. Why is this person bothering me?

But the problem didn't go away. Other reps began complaining. Then the customer complaints started, and the refund requests started pouring in. And still it took White weeks to pull the product. "It took a while for it to sink in," White admits. "I took it all really personally."

Wasn't White being a tad hypersensitive? After all, every manager makes a bad call now and then. In fact, White's resistance to negative feedback is far from unusual. She was just being a typical entrepreneur, suggests Kelly G. Shaver, a College of William and Mary professor of psychology who analyzed data comparing start-up entrepreneurs with those in the work-a-day world. One difference between the two groups: The entrepreneurs displayed an uncanny inclination to trust their decisions and dismiss criticism. Indeed, that tendency is exactly what is needed to overcome the hard knocks that come with launching a business.

The trouble is, the same self-confidence that launches a company often gets in the way of managing it properly. If you're not open to hearing bad news, you're not getting the most out of your employees, and you may be missing the chance to capitalize on new opportunities. You may even be sitting on a ticking time bomb. The allergy to negative feedback sets up the dreaded condition known as groupthink: Debate is not tolerated; bad decisions go unquestioned; and when it all falls apart, no one can figure out why. "There is definitely a business cost to being unaware," says Shaver.

In theory, it should be simple: You ask staffers for feedback; sincerely thank them when you get it; let them know you'll consider it; actually consider it; and then let them know whether you've decided to take action. In practice, nearly every fiber of an entrepreneur's being resists this process. Shaver's research shows that entrepreneurs are adept at "internalizing" success, taking full personal credit when things go right, and "externalizing" failure, blaming setbacks on outside factors. This psychological dynamic leads to certain less than helpful responses: Some managers become defensive and lash out; others find themselves wracked with self-doubt.

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