Can we learn any lessons from the Penn State scandal in managing our own business?

This past week, Happy Valley celebrated the life achievements of the one person responsible for the most successful major college football program in the county. By now, everyone knows the story of the downfall and has an opinion on the supposed mistakes that were made in State College. During the memorial service, no one wanted to discuss the Elephant in the 12,000 seat arena that houses the basketball team. No one dared touch the subject, except for the final speaker. Phil Knight, Co-founder of Nike understood the elephant and approached it head on. “If there is a villain in this tragedy,” said Knight, “it lies in that investigation, and not in Joe Paterno’s response.”
Hopefully your organization never has to deal with anything as tragic as the accusations in State College, but can we learn lessons on a much smaller scale in our own companies? Mistakes will be made in every organization; some big, some small. Problems will arise all of the time, typically because someone made a mistake. The question is, do we acknowledge the mistakes or let them slide? Do we solve a problem immediately or let it fester? Do we make difficult decisions and communicate those decisions effectively or hope the problem will go away? These are decisions that business leaders must wrestle with consistently. These are the same decisions that Penn State leaders faced more than ten years ago.
It is important to recognize that the institution is bigger than any one individual. However when the leadership team is more concerned with protecting its image than correcting the error, they are compounding the problem. When Penn State officials failed to report the crimes to the proper authorities, they neglected to solve the issue and in essence were hoping it would just go away.
When a mistake occurs, management must react immediately, and the subsequent problem needs to be resolved. True leaders need to make unpopular decisions that may put their own reputations, and their positions of power, at risk. When they do, the message they must deliver in response to the crisis can be even more difficult to communicate. But it is that personal courage and integrity that a leader must demonstrate when a crisis arises. If he or she does so, the organization, and all of the people affected by the crisis, will ultimately be better for it. No one really enjoys dealing with mistakes and the predicament they create, but remember, problems are not like fine wine, they do not get better with time. Unfortunately, Penn State found this out the hard way.