Shortly after joining Salomon Brothers in 1975, I had an opportunity to rescue a troubled account. Our firm was getting almost no business from one of our huge institutional clients, but I made some headway and surprised everyone, including myself. As the new guy on the desk, I was eager to prove myself and win my boss’s respect. He was the partner who ran the Chicago office and an inspirational, if opinionated, leader—the kind you would work like crazy for but who drew a bright white line down the center of every situation and let you know if you were on the wrong side. With this particular client in turnaround, I was doing well—until catastrophe struck.

One day, without warning, a large investor came into the market and took gigantic positions of bonds in a new issue. The transaction rocked our firm. Whoever covered this client had been asleep at the wheel. He should have been in constant contact with the company, known the trade was coming and gotten us in on the action. I remember sitting on the trading floor that morning, computer screens blinking, guys shouting across the desks, the CEO furiously barking orders over the loudspeaker, while we scrambled around as though the roof were caving in. I had the fear of the Lord in me that the mystery investor might be my own client—and the feeling turned out to be justified. There I was at an especially sensitive point in my career—defrocked. I felt like an idiot. It was public, demeaning and awful.

Dazed, I wandered over to the window of our 42nd-floor office and peered down. I thought this was a disaster and that I had no way to win back credibility. Suddenly my boss appeared. “Why do you think they’re so unhappy?” he asked me.

“Because I lost the deal?” I replied despondent. “Because I’m a loser?”

“No,” he said emphatically. “It’s because for the very first time this was our business to lose. A month ago we didn’t even have a chance of winning. You fouled up this play, but you were the one who got us onto the field in the first place.”

For the next week, my boss took the heat from the higher-ups. When I made partner six years later, the mystery investor was one of our firm’s most profitable clients.

In financial services, where the focus is on quarterly earnings and the daily stock price, what my boss did was exceptional. But it’s what all great managers must do to keep and grow top talent. When superstars, especially young ones, suddenly come up short, it’s your job not just to forgive their mistakes, but also to reignite their confidence.

People who make errors and move on without a second thought aren’t the ones, in my experience, to count on over the long haul. Young potential A players, by contrast, suffer from terrible self-doubt. After a slump, they assume the game is over, begin to second-guess their success and, without the right kind of management, stop taking the sorts of risks that first made them successful. No leader can afford that type of loss.

I think of talent within our organization in terms of generations. My direct reports are, because of their experience, often able to avoid mistakes and can right the ship when they make them. It’s the red-hot performers the next level down that we have to watch like hawks. When they strike out, I offer this message: “There’s no one I want at bat besides you.” I encourage the older generation to anticipate exactly how they’ll handle underperformance by their best people. What you say in such situations can shape entire careers.                 

Daisy Wademan Dowling is the author of Remember Who You Are: Life Stories That Inspire the Heart and Mind (Harvard Business School Publishing, 2004)

The Best Advice I Ever Got

Shortly after joining Salomon Brothers in 1975, I had an opportunity to rescue a troubled account. Our firm was getting almost no business from one of our huge institutional clients, but I made some headway and surprised everyone, including myself.

Using conflict as a catalyst for change

Deep organizational change inevitably produces conflict. Those who lead change usually try to suppress conflict, with the goal of keeping the energy positive and the forward momentum strong.

Law& property

Talk about having the right address.

That’s how Atty. Andres D. Bautista, chief executive officer of the Kuok Group in the Philippines, was initially considered to become the Hong Kong-based group’s top guy in the Philippines.

Winning: When the chips are down, keep your chin up

Q: Our company, like many these days, is experiencing lower earnings and the termination of many good employees. How do we build morale and give employees some sense of confidence in the face of poor financial results? Name Withheld, Maryville, Tennessee

From farms to tables

Governments serve the secondary purpose of intervening when free markets come perilously close—or are perceived to be close—to losing control.

Food-Price Shock

The globe’s worst food crisis in a generation emerged as a blip on the big boards and computer screens of America’s great grain exchanges. At first, it seemed like little more than a bout of bad weather.

Take the lead at your next review

The management literature is full of advice for those who want to deliver effective performance reviews. The usual mantra? Use review sessions to set clear expectations and goals but never forget to praise good work and to listen closely to employee concerns.

What you can gain when you lose good people

Knowledge workers in technology companies generally don’t view their jobs as being about human relationships. The more introverted among them would probably even shudder at the thought.

A call to Help

Choosing the less traveled path can lead to either great heartbreak or indescribable rewards. Luckily for Marilou Pantua-Juanito, VSO Bahaginan executive director, it is the latter which she continues to reap.

Winning: Collaboration is the mother of innovation

Q: When you read the history of the greatest products ever created, you find out that many times the innovator was ignored or ridiculed by his company along the way and even had to struggle against the wishes of management. Why does this happen? Shouldn’t managers at least be giving these people moral support?  Name Withheld, Livermore, California

Hand to Mouth

Maria Susana Espinoza wanted only two children. But it was not until after the birth of her fourth child in six years that she learned any details about birth control.

Rice shortage may mean more trouble for Arroyo

Myrna Lacdao used to eat two meals a day. Now she eats one, and gives the rest to her two grandchildren.

In the Shadow of Debt

Summary: The stagnation of the Philippine economy has now lasted over 25 years. Between 1990 and 2005, the Philippines’ average annual GDP growth rate was the lowest in Southeast Asia, being lower than even that of Laos, Cambodia and Myanmar.

Five ways to boost retention

* boom times and slow times alike, you need to keep your best people. Let’s look at five proven practices to help you do just this.

1. Provide room to grow. Nothing is more frustrating for an employee than discovering he is out of growth opportunities.

The tourism time bomb

International travel is no longer the exclusive province of the rich. Over the next several decades, hundreds of millions of new entrants to the middle class will want not only the things—but also the experiences—that money can buy.

Developing Markets

General Electric Co. (GE) is divesting consumer-finance businesses in the UK and Germany and selling its US corporate credit-card unit to concentrate on higher-margin areas and developing markets, GE Money’s chief executive said.

Mobile Entrepreneurs Nokia calls on entries for innovative contest

In a bid to boost the deployment of mobile technology to country’s entrepreneurs, Nokia pioneered in the Philippines with the recent launching of the first-ever Nokia Mobile Entrepreneur Awards aimed at recognizing small entrepreneurs who use mobile technology in their business.

Winning: Bureaucratic management done right

Q: What is the difference between a bureaucrat and an effective manager? Brian Napoli, Medina, New York

Engagement is the new reach

SINGAPORE—Southeast Asia’s advertising landscape is quickly changing. As people’s lifestyles change, with many logging in 36 hours of activity in a 24-hour day, advertisers have recognized that the traditional advertising media—TV, print and radio—cannot hold consumers’ attention long or well enough.

Something had to give

More than anywhere else in Asia, the soaring price of rice has become a good-vs.-evil drama in the Philippines, one of the world’s largest importers of rice.  Traders who fiddle with the price of the nation’s all-important staple now face life in prison.

How Coca-Cola built strength on diversity

In 2000 The Coca-Cola Co. settled the largest racial-discrimination lawsuit in history. Filed on behalf of approximately 2,000 former and current US employees, it resulted in a $192.5-million settlement.

Making diversity a business advantage

Today, the smartest organizations in the world are recognizing that their diversity can be a source of competitive strength.