“Failure and disconfirmation are often more informative than success and confirmation.”
Nassim Nicholas Taleb, author of The Black Swan, has a gift for ruining the mood with irritating precision.
He is right here too. Failure is often more informative than success. And yet companies remains far more interested in the winners than in the casualties. We have shelves of books, keynote sermons, LinkedIn victory parades and airport-bookshop manifestos explaining how great brands were scaled, premiumised, made culturally radiant and, of course, rejuvenated. What we do not have, in any serious proportion, is the opposite: a serious body of thinking on how businesses decay, and what failure can uniquely teach.
I checked Amazon and Google Scholar, just to make sure this was not merely a cranky exaggeration. It wasn’t. There is no shortage of books on how to build strong companies, make brands purposeful and irresistible to the young. The shelf on how businesses fail, lose their way, and can be diagnosed in decline is tiny by comparison – and not exactly fresh.
Imagine a bookstore with 3,000 books on yoga, breathing techniques and mindfulness, and one slim pamphlet on heart attacks. You would conclude that the owner had developed a slightly unhelpful relationship with risk.
That, more or less, is the state of business literature.
Success casts a misleading halo
Success flatters. Worse, it rewrites the story in its own favour. When things go well, we credit our insight, our strategy, our innovations, our teamwork, our workshop with sticky notes, the whole sparkling edifice. Tailwinds are not mentioned. Competitor mistakes disappear. Luck slips quietly out the back door.
Average decisions begin to look like brilliance. Victor Hugo put the problem brutally: “Success is an ugly thing, because men are deceived by its false resemblances to merit.”
Psychologists call this halo effect. Success does not merely flatter. It distorts judgment. It pushes attention toward visible wins and away from uncomfortable causality. It rewards stories that are neat, and wrong in exactly the way people enjoy most: a little simplistic, a little heroic, memorable and easy to reuse in the next offsite.
Sometimes success does not merely flatter you. It makes you believe your own PR.
I lived through my own version of this at Suntory Global Spirits. In super-premium whiskies, we genuinely believed our very expensive limited editions were selling because of our storytelling brilliance, our desirable collaborations, and all the rest of it. Then the market turned, the bubble burst, and many of the supposed “collectors” and fans vanished – revealing that they had never really been collectors at all, just speculators riding a rising market.
A good deal of that supposed magic vanished with them.
It was a useful reminder that success often tempts management to over-credit its own brilliance. What looks like proof of superior storytelling, strategy or brand magic may owe far more to market conditions, or tailwinds that have little to do with your actual performance.
Success rewards overly simple stories
There is another way success lies. It makes us too comfortable with stories that are simpler than reality. Success stories travel well because they fit on slides. They are easy to retell. That is why they produce so many broad, reusable “lessons”: strong teamwork, sharp execution, disruptive innovation, disciplined focus. All perhaps true. All also wonderfully vague.
The problem is a genuine dilemma: what is simple is often false, but what is not simple quickly becomes unusable. That helps explain why so many business lessons end up being wrong. In the understandable effort to make them usable, we simplify too aggressively. We flatten the complexity, clean up the nuances, and turn multi-factor causality into a tidy lesson people can remember – and repeat.
Why failure is a better teacher
Negative knowledge is often more useful because failure is usually more revealing than success.
An image may help. When a rocket launch succeeds, the explanation quickly dissolves into the familiar fog of managerial self-congratulation: strong teamwork, sound engineering, brilliant technology choices, disciplined execution. All perhaps true. All also vaguely useless. But when a rocket explodes, and you examine the wreckage properly, you can often identify the failure point with far greater precision: this valve, this seal, this sequence, this decision, that day.
Business performance works much the same way. Success invites flattering generalities. Failure, properly examined, leaves a clearer trail. It forces specificity. What changed? Which audience was neglected? What pricing decision was made? Which choice sounded reasonable at the time and now looks absurd in retrospect?
That is why some of the most valuable business lessons are hidden not in triumph, but in decay.
Why we often prefer not to look
The problem is that negative knowledge is not just more concrete. It is also more embarrassing.
In my field of marketing, teams avoid analyzing failure because its lessons are socially inconvenient. It is one thing to study decline caused by brutal competitors, changing tastes, ruthless retailers, inflation or platform disruption. Those are agreeable villains. They preserve everyone’s dignity. They allow us to say the market changed, private label got stronger, TikTok happened, Gen Z moved on, and what can one do.
But decline is often at least partly caused from within. It is frequently the result of respectable people making bad decisions for understandable reasons. Not evil ones. Just poor ones. Defensive ones. Meeting-friendly ones. The sort of decisions that sound prudent on PowerPoint and look deranged six quarters later.
I saw this very clearly with Ribena, the iconic British blackcurrant drink. Between roughly 2015 and 2022, the brand went through a difficult period in which it lost significant share and profitability. Cases like that ought to be a gift to any serious marketing organization, because they show how brands are often weakened not by one dramatic act of stupidity, but by a sequence of perfectly reasonable decisions.
As CMO of Suntory Beverage & Food Europe, when I pushed for deeper diagnosis, even in the name of learning, the response was often some version of: “let’s move on”, “the past is the past”, and “let’s look forward”.
Which sounds dynamic, healthy and mature.
It is also a remarkably efficient way to ensure the same mistakes remain available for future use.
And yet what sat in that history was exactly the kind of knowledge marketers claim to want: lessons on brand stewardship, on the danger of strategic zig-zagging, on what happens when targeting drifts away from the brand’s core role, and on how innovation can quietly become dilutive instead of strengthening. Ribena was not a loud public fiasco. It was something much more useful: a brand weakened by the accumulation of decisions that slowly made it less legible, less desirable and more substitutable.
That is negative knowledge in action. Not glamorous. Not conference-friendly. But genuinely useful.
The charlatans step into the vacuum
This also explains why the literature is so lopsided. Marketing has shelves of books on growth and almost none on brand decay. Not because failure is rare. Not because it lacks economic importance. But because success is easier to narrate without indicting anyone, and failure is revealing in ways that are awkward.
And into that vacuum step the charlatans. As Taleb notes, they are recognizable because they offer positive advice, and only positive advice. Marketing has no shortage of these people. They are always ready to explain how to turn your tired regional mayonnaise brand into a purpose-driven cultural icon for a new generation. Their formulas are suspiciously universal. Their confidence is touching. Their assumptions usually involve Apple’s margins, Nike’s distribution, and a board of directors with the patience of Tibetan monks.
The real use of negative knowledge: a life-saving software
Negative knowledge is not just a collection of anecdotes. It’s a body of knowledge businesspeople need to possess.
Take medieval medicine and the common practice of bloodletting. The problem was not that doctors were imbeciles. They were often the brightest people in their villages. It was
that they lacked the underlying mental software to understand disease properly. Smart people, serious treatment, bad model. The patient paid the price.
Business often behaves the same way. What it needs is a stronger mental model for diagnosing decay and recognizing the recurring malpractices that turn an ordinary performance gap into a fully developed brand failure. A model for spotting when diagnosis has been replaced by storytelling, when repositioning becomes zigzagging, when innovation becomes dilution, and when price promotions become addiction.
Failure only becomes a true failure when nothing is learned from it. That is what negative knowledge is really for. Not pessimism. Not schadenfreude. Pattern recognition.
Proper diagnosis is possible, but it is hard work. It demands patience, causal discipline, a tolerance for complexity, and a willingness to revisit decisions that are awkward to revisit. Which is precisely why so many people prefer the easier option: positive narratives, flattering summaries, and success stories that ask much less of the intellect – and even less of the ego.
The result is that the lessons that matter most are often the ones we are least eager to study.
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