I know it sounds like there are two different messages here, but not really. There are two important errors many businessmen make when it comes to failure (a word that I hate, by the way). First, some business owners will remain in a segment, or maintain an account, in which they have been failing for too long a time because they have convinced themselves that it should work. Several years ago, I read Jim C. Collins’s book Good to Great. It had a huge impact on the way I think about business and how diversification may not work for everyone. The book’s premise states that the main factor for a company moving from good to great is its narrow focus of company resources on its main fields of competence. Today, many businesses are creating multiple revenue streams within their main business. For some, it works. But for numerous reasons, inadequate resources being the most common, it does not work for everyone. Continuing to throw good money after bad damages the core business, especially if there is an intent to sell anytime soon. Second, many people give up completely after a business failure. I can only imagine how devastating it is to experience something like this, but also there can be countless lessons learned by going through the experience. There are many examples of people who have experienced great success but whose first attempt failed.
Walt Disney’s first business ended in bankruptcy. For this reason, he was turned down for financing hundreds of times before obtaining the money to start Disneyland. J. K. Rowling, one of the world’s most successful authors, received rejections from numerous publishers for her Harry Potter series. During that time, she was a single mom living in severe poverty. My favorite though is a man who failed many more times than he succeeded. Thomas Edison illustrated his story by stating, “If I find 10,000 ways something won’t work, I haven’t failed. I am not discouraged, because every wrong attempt discarded is another step forward.”