Countless volumes have been written over the years about the causes of failure. I thought I would explore the other side of this issue and speculate on the causes of success. Why are Border’s Books, Linens and Things, and Circuit City out of business yet their chief competitors, Barnes & Noble, Bed, Bath and Beyond, and Best Buy are still around? How does Owenhouse Ace Hardware and Kenyon Noble last over 100 years yet the giant Wickes Lumber Corporation goes belly up in a few short years?

Is Failure Just Lack of Success?

Failure has many definitions. Failure to win the game is an example we are all familiar with. Many games carry a time limit within which to succeed. Football, basketball, and hockey all have time limits. Whoever is leading when time runs out is declared the winner and the loser goes home to fight another day.

On the other hand, the rulebook defines the winner in baseball, tennis, golf, bowling and billiards. When certain defined levels of achievement are reached a winner is declared.

In some games you’re playing against yourself as much as an opponent. Golf is a perfect example. Not only are you competing against someone else but you are also trying to better your personal score. Golf also handicaps players so those of uneven abilities can compete on a level playing field. Imagine how business dynamics would change if a start-up business could compete equally with a major chain store.

It’s a team effort.

Most sports, like businesses, are team sports. Several people pool their individual talents to produce a successful team outcome, but it doesn’t end there. Business owners, managers, and team leaders should always try to improve their own personal “game plan” while inspiring the team to excel at the same time. In my opinion, it’s the failure of owners or managers to adapt the game plan to changing game conditions that account for the failure of the companies mentioned above.

Montgomery Ward, Circuit City, Mervyn’s, Border’s, and Linens and Things didn’t have a bad business model; what they failed to recognize was the changes in the way customers wanted to buy products or services. Border’s, for example, placed too little weight on the importance of online book buying. Circuit City lived and died by the discount. When the recession went beyond eighteen months they were left with bargain buyers and margins too small to survive.

One Companies Strength Is Another Companies Weakness

The best performing stock in 2011? McDonald’s. Why? Because during a recession when people are searching for lower cost food choices McDonald’s offers that product at full price and full profit margins. McDonald’s attracts the kids, while Wendy’s takes the adults leaving Burger King to twist in the wind without a clearly defined customer base. While McDonald’s and Wendy’s have familiar menu items, Burger King must resort to expensive testing of new products trying to find something to lure customers away from the two leaders.
Two Game Plans

Failure to adapt to new customer habits has clearly taken its toll on major retailers. In the first six months of 2008, one major chain store closed every hour on the hour, 24/7. On the other hand, McDonald’s didn’t really change anything and yet they are doing a land office business. Which one should you use?

The short answer is to remember my first rule of marketing. “When emotion and logic come in conflict; emotion always wins.” People buy things, not because of what they do, but how they make us feel. If I can save time or money, avoid worry, solve a problem, then I am way ahead of the game in surviving tough times. If I can do it and still make a profit then I am really on the fast track to success.

Have you looked at your game plan lately? Is the economic game clock running out? Are you playing catch up? Take a cold hard objective look at your business and your customers. Review your business plan and your business model. Get customer feedback. Are you in a logical death spiral or on an emotional ride to the top? The latter will make you feel a lot better.

Tom Egelhoff, www.smalltownmarketing.com, is the author of, “How to Market, Advertise and Promote Your Business or Service in Your Own Backyard.” Listen to Tom’s weekly radio show, “Open for Business, 11-2 PM Mountain Time every Saturday at http://kmmsam.com. Click “Listen Live.” Also, check out Tom on Twitter, Facebook and LinkedIn.