Why I Pay People to Make Expensive Mistakes

Your biggest mistakes have the best ROI.

Hey!

Chris here. Welcome to Blueprint—the newsletter to help you build a winning engineering team.

Chris here. Welcome to Blueprint—the newsletter to help you build a winning engineering team.

I spend more time dealing with emergencies than probably anyone should. So I can confidently say that you don't find out what a leader is really made of until you watch them lead through a "hair-on-fire" situation.

I'm talking about when systems crash, when someone accidentally takes down production, or when a single decision costs 1,000s of dollars. That's when you can really see someone's character.

After living through more of these than I like to admit, here's what I've found: Most leaders treat mistakes like fines. Great leaders see them as tuition.

Here's why most managers mess this up (and how you should operate instead). 👇️ 

📒 DEEP DIVE

See Mistakes as Tuition, Not Fines

How the best leaders reap ROI from costly mistakes by treating them as investments in education.

I've watched too many leaders handle mistakes as punishment or to make an example of people.

Throughout their careers, these leaders have found that highly emotional responses get them what they want.

When there's an emergency and you scream and yell, people do what you want them to do. So some leaders think: "I'll just pretend everything is an emergency by screaming and yelling, so then people will always do what I want."

But what you eventually discover is that this approach doesn't work forever. You inevitably lose your team down the line.

And then, when real emergencies arise, people don't come to you.

Because nobody trusts the leader who cried wolf.

Mistakes Are Expensive Education

Here's what subscribers to the "paying a fine" versus "paying tuition" mentality miss: when someone makes a costly mistake and genuinely feels terrible about it, they've just become your most careful employee.

This employee just did ten years of learning in ten minutes. And they're now the least likely person ever to make that mistake again.

If you fire them for it, you're essentially paying for their education and then handing the ROI to your competitor.

Because great technicians don't become careful through training programs or safety meetings. They become careful over time because mistakes bite them in the ass.

Yes, there's a horrible, scary moment followed by growth. But if you let someone go after learning a powerful lesson, you're only hurting yourself.

The 95/5 Rule

In my experience, about 95% of people who make mistakes feel awful about it. As leaders, these are the people you want to keep and develop.

But about 5% of the time, someone makes a mistake and doesn't care at all. It's rare, but when that happens, you fire them.

The issue isn't the error they made, but how they responded to it. You just discovered something about who they are that's fundamentally incompatible with building a great business.

Vulnerability Creates Trust

When I have someone who's devastated by their mistake, I tell them about the time I was 19 years old and took down 5 banks simultaneously...for hours. Yes, that really happened.

This vulnerability shows them that I'm not perfect, and that's a realization I want every team member to have. But it also gives them comfort that overcoming self-inflicted wounds is part of the path to being great.

When you normalize mistakes as part of growth, you create a culture of trust where people can learn without fear of retribution.

Building Culture One Investment at a Time

When something really horrible happens—and it happens all the time in business—great leaders are enormously gracious about it.

Because every time you respond to a mistake, you're setting another part of your cultural precedent.

And when you treat mistakes like tuition instead of fines, you create an environment where people surface problems early, communicate openly, and focus on solutions instead of hiding from blame.

BEFORE YOU GO…

Every time someone on your team makes a mistake, you have a choice.

You can treat it like a fine—punish them, make them feel worse than they already do, and watch them either leave or become fearful and disengaged.

Or you can treat it like tuition—expensive education that just made them more valuable, more careful, and more committed to getting it right next time.

The mistake's already happened, and the cost's been paid. The only question is whether you'll reap the return on that investment or waste it entirely.

The decision's yours.

Talk soon,

Chris.