Let’s assume that you have been the perfect, values-centred, results-oriented leader that has built a high-performing team who trust each other and who are working to build a deeply constructive culture.

“I’m doing all the right things, so everything should go my way!” would easily be a thought dancing around inside your very active and creative mind. “After all, I’m part of the solution to this leadership problem,” you say to yourself.

Even in the unlikely event that this is 100% true, I hate to say it, but things are not always going to go how you want them to. As yet, a magic wand that enables you to control every external factor around you hasn’t been invented. You can’t control the choices and actions of another. (On a good day, you can control your own, but that’s about it!). You can’t control market forces, consumer/client behaviour, or the state of the national economy.

This means you WILL face challenges. Some you will feel ready for. Others will side-swipe you and leave you feeling utterly inadequate for the task. If you don’t believe me, just pick up the phone and call another CEO that’s been at it for 5–10 years or more, and, as long as they are being real, they will readily talk of their battle scars.

There are certain times where the way you as the leader respond has a disproportionate impact on your leadership credibility. When you’re under the pump and things aren’t going as you want is one of those times.

It is at these times where the decisions you have (hopefully) made in the past around what kind of CEO you want to be are both demonstrated and tested. When you rise to meet the challenge and do it well, it is a shortcut (albeit a painful one) to greater respect and influence. Yet, the high stakes, and often increased scrutiny at such times, can also mean the corporate doghouse lurches ever closer to your door.

In this article I’ll focus on just one of the four keys to responding well when things don’t go your way.

Your Mindset

Everything starts inside you. The world you manifest on the outside is a by-product of everything you cultivate on the inside. I often say to leaders and people I coach, “If your internal world—your thoughts, your emotions, your beliefs about yourself and the world, and your internal dialogue—became a city in which you lived, what would it look like?” They often reflect sombrely for a moment, already feeling a little challenged.

Then I cut to the point and say, “Let me help you out. It would look exactly like your life right now! Your internal reality becomes your external reality. What you have cultivated over the past 5, 10, 20 years is the reality you are living in now.”

The mindset you adopt internally will become the reality you manifest externally.

(Before you go down some “I’ll just think about a billion dollars then…” trail, you manifest what you actually believe, not what you want to believe. You can’t fake it or use it like some hocus-pocus incantation.)

Turns out that there are two types of mindset that have the biggest impact on how you will respond when things don’t go your way.

Researcher Carol Dweck is a Professor of Psychology at Stanford University, and has spent more than 30 years studying motivation, personality, and development. She coined the concept of a growth versus a fixed mindset.

A fixed mindset is one where I believe that my skills, abilities, and intelligence are largely something I have or I don’t have. When faced with a challenge, I assess myself and my abilities. If I believe I have the ability, I will engage with the challenge. If I believe I don’t, I will avoid it.

Conversely, a growth mindset looks at a challenge and says, “Who do I need to become to meet that challenge?” I view my skills, abilities, and intelligence as something that can be developed—that through training and effort I can become more skilled than I currently am.

A fixed mindset says, “This challenge could destroy me,” and therefore I approach it with fear. A growth mindset understands that every challenge is an opportunity for upgrade: I will become a better leader, a stronger person through this challenge.