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IntroductionWhy Great Strategies and Change Initiatives Fail

A while back I was asked to participate in one of those executive leadership programs where you go off-site with your peers and role-play a business simulation over the course of a couple of days.

You found yourself in charge of a fictional business, needing to make smart decisions, trade-offs, and investments to grow your revenue and profits in competition with your peers and their pretend businesses.

One of the tools you had in this simulation was the ability to make investments in various predefined “initiatives.” These initiatives were things like “manager training,” “supply chain cost reduction,” or “accelerating product development.”

Investing in an initiative would result in an advantage, like extra profit from cost reductions or shorter time to market. You couldn't just apply these initiatives. Just like in the real world, if you wanted to invest in an initiative, you needed to find the money to fund it from somewhere else in the business. You could either make a short-term profit trade-off, or take investment from another part of the operation to fund the initiative.

But unlike the real world, all you needed to do was to choose an initiative and fund it—and then your business gained the advantage in the simulation. You simply wrote the check and collected the benefit. Just like that. Every time.

One of the most senior executives joked, “The great thing about these initiatives is that they actually work! In ...