Despite our best efforts and self-image of high competence, we do all make mistakes. At executive levels in healthcare this reality is no less true than it is in business, in academia, in church organizations, or in the military. The CEO of American Airlines and many others in business, the president of St. Bonaventure University, numerous Catholic bishops, and the heads of both the Air Force and Naval Academies have been visible examples in 2003 alone. Recent indictments of healthcare executives with the Tenet Corporation and other healthcare institutions are receiving considerable notoriety as well (Abelson 2003).

To better understand the reality and position ourselves to turn the phenomenon of mistakes in a managerially helpful direction, some illumination of the context in which management mistakes unfold is important. This chapter is designed to do just that. Some of the context is generic – common to all organizational settings; some of the context is specific to healthcare entities. For conceptual clarity we explore the context by distinguishing eight major aspects: legal, organizational, financial, political, professional, ethical, social and psychological.

Legal dimensions

Probably the most obvious dimension of the context of managerial mistakes is the legal aspect. It is rather visible, and mistakes in this area can have serious consequences for the individual executive and for the corporation. Prison time and significant fines, as well as negative publicity and reduced market performance, are part of the reality.