It has been said that up to 90% of strategies fail. Sounds harsh, indeed. But even if the claim may be provocative, there is reason to ask why so many strategies go wrong. Tons of explanations have been served, below are some statistics that I believe shed light on why. The stats have come my way during the last few years, and unfortunately my archives do not give proper credit to all my sources.

My own studies of Finnish companies reveal that about 50% of them create strategies with at least some kind of documentation. The reasons the other half does not do strategy may be that (a) strategy is not considered essential, (b) there is no time to work on strategy as daily fire fighting gets priority, (c) the short term objective is to survive, or (d) management lacks strategic skills. Nevertheless, studies show that successful companies have realized the importance of strategic planning. These companies use a good amount of mental resources and time to create strategies and to execute them.

Despite this, 85% of business leaders spend less than an hour per month on strategy. With that kind of commitment it is difficult to expect strategic output of quality, not to mention strategic implementation. About 80% of business leaders consider strategic implementation their biggest challenge. The implementation suffers from the facts that (a) if there is a corporate incentive scheme, 75% of the implementing managers lack strategy related incentives, and (b) 60% of the companies doing strategy do not link it to annual budgets.

Strategy has a meaning only when it is understood by the whole organization. Hence, all strategies include an element of implementation. However, whereas 50% of leaders say that their strategies are implemented only 10% of the personnel think that strategies are implemented. And typically, around 5% of the staff reports that they understand the strategy of their company. In light of this, it can be asked whether the reason is bad strategy or bad leadership.

If about half of the companies are doing strategies, some of them are strategies just for the sake of it. A report from Market Vision stated that 72% of strategic decisions are based on gut feel. In other words, decisions and directions less often rely on facts and a thorough understanding of the market environment. In my own strategic work, I have often noticed on how shaky grounds strategies are. Quite often the basics of any business are highlighted as strategic pillars. For instance, 75% of companies mention customer service as a critical strategic element and correspondingly 70% mention customer satisfaction as their main value. Differentiation and competitive advantage require more than clichés, hence, strategic planning should get a higher status.

Conversely, if 50% of companies do not create any kind of systematic strategy, if 15% of leaders invest in strategy work, if 28% of leaders gather data for strategic decisions, if 20% of leaders believe they have the skills to implement strategy, if 25% of leaders provide their key personnel with strategic incentives, and if 40% of leader link their strategy to annual budgets, then, suddenly the failure rate mentioned in the beginning does not sound so incredible anymore. That said, boldly into the wonderful world of strategizing, just a little statistical margin of error and the strategy may actually work.

Why strategies fail

As I recently met with one of my former employers, I recalled the efforts we made fifteen years ago to internationalize one of its business units. Based on my experience of leading the internationalization process of that business, I later felt an urge to (i) assess the validity of prior internationalization research both from a contemporary world order perspective and a managerial perspective, and to (ii) propose a comprehensive internationalization model that revitalizes common knowledge and incorporates empirical reality in describing, explaining and predicting the internationalization drivers.

In the paper attached, I have tinted some of the weaknesses in internationalization theorizing, as well as stressed the importance of finding a new gear in building a simple model of managerial value. My ambition here was not to invent the all-time model of internationalization, but rather to contradict the missing tradition of building upon the findings of previous research, to glean knowledge from other disciplines, to avoid the common research replication trap, and to reflect the business environment of today. It is interesting to note that this study was initiated both by an academic call to upgrade and validate internationalization constructs, and by an inductive call to anchor the empirical reality of one company within a conceptual framework. The analysis of my case company proved earlier internationalization frameworks to be insufficient. Although the presentation here is limited to one case study, my work with several other companies seems to validate the merits of the proposed framework.

And to my great pleasure, the case company in this paper is doing very well today as a truly global company.

Internationalization once again

Twenty years as an executive, both in global companies and smaller enterprises, has taught something about strategy and leadership. Some of the wisdom has been earned the hard way. I have boiled down my experience to a simple doctrine of “Sustainable Stories – Sustainable Leadership”.

Essential in strategic leadership is to create a sustainable story and to communicate this story to the organization and the stake holders. What is a sustainable story?
In the leading role we have the CEO/MD and his/her durability is tested continuously during the process. What then is a sustainable leader?
In the interplay between sustainable stories and sustainable leadership both are better, but will the equation work if one of them is insufficient?
What is sustainable? If something is tolerable, fair, reasonable, supported, and able to last and continue, then it is sustainable.

The interesting starting point is that, one the one hand, a strategy is at its best when it is a story, and on the other hand, stories are born from strategies. A great number of strategies fail because strategies only have meaning when they have been understood. This is where stories (storylines and storytelling), an ancient way of leadership, can help. A story is a description of something true and real, and it has a lesson. It is way of transforming and crystallizing a complex strategy into a readable and memorable form. A story can bundle business direction with actions. It can combine reason and emotion. It will create a common language and understanding for the people in the organization. It can anchor the daily work of all employees. And finally, a story can differentiate from the mass.

In Hollywood they teach that humans are, and have always been, programmed to listen, understand and follow messages that are sent in a story format. Management studies show that top executives consider competitive strategy and people management their biggest concerns. Studies also show that employees consider their bosses biggest weakness the lack of vision and direction. Hence, the life of leaders should be easier if they can rely on a sustainable story.

Some of the characteristics of a sustainable story are as follows:

 (even for the teller) – A good storyline strengthens the leader.


 – Addresses others than its writer/teller.


 – It has an effect on many listeners.


 – Concrete, challenging, realistic and inspiring.


A long time ago, Jethro coached Moses to select leaders who ”fear God, are trustworthy and who hate dishonest gain”. It has been said that Moses strength as a leader was that he was able to cast a story to which his followers embraced. He modeled his vision of leaving Egypt for the Promised Land so that the story came alive for his followers.

But are there perfect leaders nowadays? Hardly. Based on all the management theories I have read and based on my own experience, I would argue five things: (a) There are no common specifications of a great leader, (b) Good leadership equals good subordinates to lead, (c) The charisma of the leader will not necessarily impact on the company’s result, (d) All leaders will deliver at some time, nobody will deliver all the time, and (e) By the power of stories leaders will grow stronger.

What is a sustainable leader? Not forgetting all the typical management skills, below a few other key characteristics:

 – It is difficult to tell others’ stories.


 – It is contagious so followers catch it.


 – Somewhere between a blessing and curse.


 – Sticks to the story even if the wind blows from the wrong direction.


 – At the right place at the right time.


 – A good shoulder at home.
Based on my own experience as an executive and management consultant, it is easy to argue that successful leadership has always been a consequence of a good storyline and good storytelling. In other words, leadership is tough and more or less impossible when you have not been equipped with a good story. Following other leaders, I have noticed a similar pattern. Succeeding in one mission does not guarantee succeeding in another mission, where the possibilities of the story are different. There are, of course, cases where leaders will sustain even if the story does not, or where stories will sustain but leaders will not. The question is, which one is easier to change, the story or the leader. Nowadays, it seems like managers are more easily replaced than stories.

As a business coach I try to tell future leaders that humans can less often be programmed to become excellent leaders, or that personal charisma cannot be developed in the same way as other business skills. But this is not the end of it. Powered by a good story, leaders have a better chance of succeeding in their managerial tasks.

Hollywood seems to be on the same page. Experts from the film industry say that it is not about the leader, it is more about a charismatic message. Build your story by picturing the happy end, by describing the not so rosy beginning, by describing the actions the audience wants to hear, and by adding watery eyes.

Butler's blog

Why strategies fail

Internationalization once again

Sustainable storylines - Sustainable leadership