Its core meaning is to accept a small, manageable loss to prevent an intolerable systemic risk from occurring. In short, it means limiting losses through self-inflicted damage: taking a small loss to prevent a larger one. Examples include fuses in electrical systems and bumpers on cars. This design approach to breakage protection is very effective and can serve as a mental model.
We shouldn’t assume that a system has only one breakpoint along its chain; it can have several at different levels. Taken together, they act as warning signals, each preventing the next level up from being damaged further. For example, the competitive mechanism among players is a breakpoint that prevents sportsmanship from deteriorating; a red card on the field is a breakpoint that prevents players from crossing the line and disrupting the competition; and a yellow card is a breakpoint before a red card. The referee’s serious, emphatic gestures to stop play are a breakpoint before a yellow card,
Reconsider some of your own mistakes and see them as breakpoints that can prevent greater losses later on. You can also see other people’s well-intentioned reminders as breakpoints that keep you from becoming deeply disliked later and suffering further losses in your relationships, and so on. For us, these may all be very necessary.