Good Failure vs. Bad Failure

Not all failures are equal.

Some failures build capability.
Others just burn time, money, and credibility.

I saw this play out at a company I worked with years ago.

The business was largely project-based, and there was a push to shift toward a more predictable, subscription-style model.

On paper, it made sense:

• more recurring revenue

• more predictability

• better valuation profile

The problem was the customer behavior didn’t match the model.

Clients:

• valued flexibility

• couldn’t predict future demand

• didn’t want long-term commitments

Those issues were visible early.

But instead of pressure-testing them quickly, the organization spent months:

• building pricing models

• designing packaging

• developing GTM strategies

• preparing rollout plans

Eventually, the model launched.

And within weeks, it was clear:
the core issues hadn’t been solved.

The initiative was scrapped.

That’s not a failure problem.
That’s a process problem.

A good failure:

• tests the hardest assumption early

• minimizes time and resource exposure

• produces a clear answer quickly

A bad failure:

• avoids the core risk

• scales investment before validation

• hopes the market will adapt

Most companies say they want innovation.

But what they actually need is:
discipline in how they fail.