3 Company Failures That Unexpectedly Saved These Businesses—And Made Them More Innovative

Candid image of a group with business people caught in an animated brainstorming meeting

Your company can learn invaluable lessons from failure, from better understanding market demand to product weaknesses.                                               

Carter Liebscher|
January 17, 2020

Last week we examined how failures can often help lead your company to success. The lessons your company can learn from them are invaluable, from better understanding where the market demand is to patching up product issues that made it past prototyping. 

We recommended tempering left-field ideas with more tried-and-true projects, but the point still stands: Encouraging novel ideas from front-line employees and beyond will help keep your organization curious and humble.

This week, we’ll look at companies and products that endured some downturns but ultimately benefitted their respective organizations. These are cases of wrong timing, products not meeting the standards of the market at their release but later proving perfect, and cases out-of-date management styles. Take a look below to see if any bear resemblance to any of your company’s projects or operating processes.

Bubble Wrap: More Than 400 Uses but Known for One

A silly example, sure, but one that best exemplifies how inventors, companies, and employees can test out seemingly one-note products in new, offbeat use cases.

Bubble Wrap was initially conceived as a textured wallpaper. Its two founders, Alfred Fielding and Marc Chavennes, found it difficult to market it as such, taking the product back to the drawing board. The duo devised more than 400 other uses, practical and otherwise, for their creation. Even one of their most promising conceptions, greenhouse insulation, flopped.

It wasn’t until Fielding and Chavennes heard that tech giant IBM was in need of a protective shipping material for its new 1401 computing unit that others saw potential in their product. The pair pitched to IBM that their Bubble Wrap would keep the delicate 1401 intact in transit. The two brands tested it out and were satisfied with the result, which helped open the doors for other partnerships.

For Fielding and Chavennes, numerous iterations of failure led to a windfall which led to familiarity, not infamy. It’s such a recognizable product that it’s always called by its trademarked name, regardless of which company produced it. It’s all thanks to the pair’s relentless belief in their product.

Bubble Wrap was salvaged due in part to another company’s open-mindedness, which has led them to the brink of failure and back numerous times: IBM.

IBM: Listening to Customers Positively Changed Their Management Processes

While there are a number of big names in technology today, IBM is perhaps the most recognizable name. Since its founding in 1911, the company has spearheaded a majority of the trends in the industry, from home computers to health care technology.

However, their well-respected position, started to falter in the 1980s, when a number of then-small players introduced cheaper, more user-friendly machines. IBM tried competing in 1984 with the PCJr, a personal computer that had a slew of consumer complaints, including its near-unusable keyboard.

In the early 1990s, the company nearly went bankrupt. It lost $8.10 billion for the 1992 financial year, the most amount of money any U.S. company had lost at the time. Scrambling for solutions, the company ousted its CEO and brought on a new figure, Lou Gerstner, to sort its issues out before it was too late.

Before making any sweeping changes, Gerstner sought advice from IBM’s clients to better understand how the company could use their assets to help them. Overwhelmingly, clients responded that their issues lied in integrating all the different computing machines available at the time.

With that knowledge, Gerstner internally reiterated IBM’s strengths: offering customers fully integrated technology solutions. Before long, IBM wasn’t so deep in the red. Even if they veered back into it, though, Gerstner set a precedent with his simple but effective approach of listening to customers to realign IBM’s purpose.

Dyson Vacuums: 5,126 Failures to One Worthwhile Success

Dyson founder Sir James Dyson struggled to perfect the Dual Cyclone Vacuum, the company’s flagship product, for 15 years.

In an interview with Entrepreneur, Dyson stated that he found the process of failing led to a more robust product:

“I started out with a simple idea, and by the end, it got more audacious and interesting. I got to a place I never could have imagined because I learned what worked and didn’t work.”

Dyson understood that products rarely come out the gates perfect. Even those that do receive immediate acclaim can be reworked for greater success, from upping the usability to upgrading aesthetics.

These are practices you can implement in your organization. Think of a product you and your team has been struggling to perfect. Take a cue from Bubble Wrap and consider which previously unconsidered markets can benefit from it; take a cue from IBM and ask your current clients what their needs are and how your organization can fill them; take a cue from Dyson and continually rework your products such that you don’t give up upon failure—or rest on your laurels.


It’s an intuitive lesson: You fail, you learn, you move on.

Every organization should internalize that, whether they’re at the start of their journey or established. Every industry is facing disruption, from tech to health care to insurance. Testing new ideas and product ideas are effective ways to sidestep disruption, even if it seems irrational.

If you want to see how your organization can grow revenue by testing and embracing new ideas, book a free demo of Ideawake idea management software today.

Leave a Reply

Your email address will not be published. Required fields are marked *
You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Receive insights and tips on how to build buy in, promote, launch, and drive better financial results from your innovation program.