“Failure is just a step along the way to success.” – Fast Company, March 2001

Driving Company into Ground Makes it Hard to Dominate Market, Report Notes

Palo Alta, Cal. ( – “Success is built on failure” has long been an accepted proverb in business, but according to researchers at Stanford University, hundreds of dot-coms and other companies seem to have taken the phrase entirely too literally in the mistaken belief that the bigger the failure, the larger the eventual success.

Look out world

“We’re not saying there’s no truth to sayings like, ‘You must fail in order to succeed,’ but frankly, those maxims are primarily used to make you feel better about messing up,” said Prof. Dan Levin, co-author of the study conducted by Stanford’s Graduate School of Business. “Honestly, you’re not supposed to rely on them as a guide on how to conduct business, and you’re not going to dominate the market if you make yourself crash and burn.”

Levin’s findings came as welcome, if late, news to some executives — “Now they tell me,” responded founder Joseph Park — but controversy has erupted over some of the companies cited in the report. One such firm, Lucent Technologies, denied it pursues a failure-to-success strategy.

“I know they mention us, but we did not purposefully botch anything,” said a clearly agitated Lucent CEO Harry Schacht. “Each and every one of our mistakes has been an honest-to-goodness blunder based on sincerely faulty business practices, not some intentional self-destructive strategy.”

“Um… can I restate that?” Schacht added later.

Software maker MicroStrategy, which has suffered shareholder lawsuits and a drastic loss of market value, was also singled out, but denounced the report for other reasons.

“That (study) disregards a basic law of physics, namely, ‘For every action, there’s an equal reaction,'” said CEO Michael Saylor, who described his company as “deliberately plunging its way” to the top. “We have spent the past two years screwing up in more ways than I can count, which ipso facto means we are perfectly aligned to kick some serious ass.”

As a result, Saylor continued, investors should not shy away from companies like his. “I encourage everyone to buy our stock, which right now would appear to be such a mind-bogglingly bad decision that ipso facto you cannot help but get rich.”

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