Enterprises evolve by being willing to fail on numerous initiatives in order to find the one or two that create competitive differentiation and transformation.

The job of an entrepreneurial leader is to improve their company’s value-added market position by creating superior competitive offerings for their firm. Succeeding in evolving successful initiatives with organic growth objectives is often the way you do that.

I have started 15 to 20 new initiatives throughout my career, in an effort to create new businesses or product lines. The success rate of those initiatives has only been about 30%, but thankfully; those few successes were triples or home runs that changed the competitive landscape.

If the probability for failure is so high, how could it be wise to pursue a new initiative? Is there anything that we could have done to increase the probability of success? Did we have a lot of bad ideas? This article is about what we learned.

Initiative failure is rarely about lack of quality of the idea or the dedication of the team. The reason for failure gravitates from too many, often uncontrollable, widely diverse issues. Some of these situations include:

  • Having the wrong leader
  • Losing the right potential leader due to early failure or disappointment
  • Investing too little money, time or energy
  • Having a non-supportive core business that protects the existing power structure
  • Wrong timing—either ‘before its time’ or during unexpected economic distraction
  • The wrong point of sale within the buyer’s organization
  • Conflicts with services of the existing brand in the eyes of the customers
  • Trying foolishly to get early synergy with the core business
  • Experiencing early quality control issues that were not expected or accepted
  • Possessing little ability to recruit the right supporting cast due to core business identity
  • Inappropriately trying to re-trend previously successful personnel to a different offering


We could go on and on with the list, but I think you get the point. There are many potential reasons new initiatives don’t get off the ground. Unfortunately, many of them you can’t control or predict—you are guessing—you need to combine smarts with luck. My first point of learning is not to be too hard on yourself if initiatives fail, and don’t let failure discourage you from trying over again with the same or different idea(s). It is critical to experiment and learn from insights gained that you would never have obtained if you hadn’t engaged in the initiative to begin with.

Thomas Edison once was quoted as saying, “I failed my way to success.” For an enterprise leader, this is a key concept. Yes, there is a learning curve, but you will not live long enough to experience all the reasons why initiatives fail.

The correct approach is to first create an overall strategy and end point. We will use the “going West” analogy of nineteenth-century U.S. national strategy.

  1. Launch several independent ‘wagon trains’ all heading West, but without specific end destinations. You will not bet on any one initiative, but learn what the market is saying from the results of each one.
  2. If, proverbially, one wagon train breaks down in Kentucky and all members of another get wiped out from disease in Utah, continue and learn what the market tells us from the “survivors.” We could then combine the survivors with another passing wagon.
  3. If we are left with too few wagon trains (aka initiatives), we send forth new ones. But we don’t stop ‘going West’—we just re-load and learn from past experience.


Certainly there is an economic limit to the number of initiatives you can afford, but I see too many firms solely betting on one initiative and then wasting five years when that one fails. My leaning is to expect a high degree of failure and don’t put all your eggs in one basket so that you waste years while your competitors evolve.

I also found that a leader should expect little support for new initiatives from the core business. You need to act on faith and the passion you feel for the success of the venture. The lack of core basic support could be that the core business doesn’t want things to change in the power structure, or they don’t share your vision. Regardless, real enterprise change makers go against the general grain of opinion. I’ve discovered that every successful initiative has three phases:

Phase 1: No one ‘gets’ the idea or thinks it will work.
Phase II: The idea might work, but it is deemed too insignificant to affect our business much.
Phase III: Of course it was a great idea and all were with you from day one!

Then, when those 70% of initiatives fail, the public mantra is “I told you so!” Leaders need to look in a mirror to find their best supporter and not pay much attention to the general company dialogue. The lesson here: The leader can expect to be the chief advocate against conventional wisdom, but they can’t let that stop them. The leader is not there to be popular, they are there to be respected and create new enterprise value.

Since a high proportion of new strategy initiatives fail, what is a rule of thumb as to when to throw in the towel? Obviously there is no formula or analytical answer because there are too many variables, but one thing is for certain: Until you come to that one day when you say ‘that’s it and stop it,’ the leader needs to appear 100% supportive and committed. Don’t create an atmosphere of visible dwindling support as that fuels distractors to crank up the rumor mill and doom it de facto. The leader has an obligation to those brave pioneers who are trying so hard when many of their colleagues are in more secure jobs. People also will closely observe how you handle the survivors; are they regarded as failures and demoted/dismissed, or are they thanked and protected? Leaders need to be 100% committed and never show a waning confidence in a new initiative. Save the survivors and thank them. The leader’s behavior in defeat will create the basis of their ability to recruit the next pioneers.

Lastly, with those successful 30% initiatives that have a chance to change your business, you need an exploitation strategy. The famed 19th century military strategist von Clausewitz advocated, as a principle of war, that when you have a breakthrough, throw everything through it to exploit it before the enemy can recover. That is also applicable business advice. Don’t go through the low probability success phases only to have a breakthrough and then under-exploit the initial gains. Have a plan to double down your investment and accelerate the charge!

In summary, for enterprise leaders, you are in your job to create value added transformation, not just manage the status quo. Initiatives and experimentations are required to find the ‘right answer’ and you cannot be discouraged by some failures. Don’t bet everything on one idea, and always stay visibly committed until five minutes before you give up on any one initiative. Save the survivors and bind their wounds. When you break through, move in with reinforcements quickly to exploit your good fortune. Your tenure is usually only three to seven years and there is no time to waste in ‘failing your way’ to success.

© 2015 Robert Uhler and THE UHLER GROUP. All rights reserved.