If you’ve ever run your own company then there’s a good chance you’ve made a bad business decision or two of your own. A badly timed hire, a poor supplier choice decision, a poor pricing strategy on a new line, miscalculating margins… lots of errors can happen in business. For me personally, bad business decisions have been fixable. Nonetheless, I like to make myself feel better about my own shortcomings by diving into much bigger mistakes by MUCH bigger companies.
So let’s take a slightly sadistic look at 12 of the worst business decisions ever made in recent history.
1. New Coke: A Classic Misstep
In 1985, Coca-Cola decided to shake things up by changing its century-old secret formula. The introduction of New Coke was intended to reinvigorate the brand and combat Pepsi’s growing market share. However, it turned out consumers didn’t want a new Coke – they wanted the old one. The public outcry was immediate and fierce, leading Coca-Cola to reintroduce the original formula as “Coca-Cola Classic” just 79 days later. This fizzy fiasco is a textbook case of “if it ain’t broke, don’t fix it.”
2. Blockbuster’s Streaming Slip-Up
Once upon a time, Blockbuster was the king of movie rentals. Then, in the early 2000s, a fledgling company called Netflix proposed a partnership to manage Blockbuster’s online presence. Blockbuster, brimming with overconfidence, declined the offer, betting big on physical stores. Fast forward, and Netflix evolved into a streaming titan, while Blockbuster became a cautionary tale of digital transformation gone awry. Oops.
3. Kodak’s Digital Dilemma
Kodak, the once-mighty titan of photography, had a golden opportunity to lead the digital revolution. The irony? They invented the first digital camera back in 1975 but hesitated to develop it further, fearing it would cannibalise their film business. By the time Kodak realised digital photography was the future, the train had not only left the station but was several miles down the track. The company filed for bankruptcy in 2012, a poignant snapshot of missed opportunity.
4. Yahoo’s Series of Unfortunate “No Thanks-es”
Yahoo, the internet’s jack-of-all-trades in the early 2000s, made a series of regrettable decisions that read like a “what not to do” in tech. Most notably, they turned down the chance to buy Google for $1 million in 1997 and Facebook for $1 billion in 2006. Instead of owning the future, Yahoo became a footnote in the success stories of the very companies it could have acquired. Talk about missing the boat—twice.
5. Excite Not Excited About Google
Speaking of missed opportunities, let’s talk about Excite. In 1999, Excite, a leading search engine, had the chance to purchase Google for a mere $750,000. They balked at the price, finding it too steep. Today, Google is worth more than the GDP of many countries, and Excite? Well, it’s exciting to think what could have been.
6. The Decca Records Snub
In 1962, Decca Records had the opportunity to sign a little-known band called The Beatles. After a lacklustre audition, Decca decided to pass, famously declaring that “guitar groups are on the way out.” The Beatles went on to become the best-selling music act of all time. As for Decca, they’re forever remembered for making perhaps the biggest blunder in music history.
7. Xerox Fumbles the Future
In the 1970s, Xerox PARC developed the first personal computer with a graphical user interface, the mouse, and Ethernet networking. Instead of capitalising on these innovations, Xerox executives failed to see their potential, allowing Apple and Microsoft to turn these ideas into gold. Xerox could have been a computing colossus but settled for being an also-ran in the annals of tech history.
8. Nokia’s Smartphone Slip Up
In the early 2000s, Nokia was the undisputed king of the mobile phone market. We all had one. And I probably invested more in colourful covers that clipped onto my old 5110 than I did on the phone itself. Seriously, where are all the phones with changeable looks these days?!
However, back to Nokia! They failed to anticipate the smartphone revolution, sticking too long to their Symbian platform while the world moved on to Android and iOS. By the time Nokia caught on, it was too late. Their market share plummeted, leading to the sale of their mobile business to Microsoft in 2013. A classic case of missing the signal.
9. Ratner’s Jewel of a Gaffe
Gerald Ratner, CEO of Ratner’s Group, a large jewellery chain, decided to make a joke about the quality of his products in 1991, describing some of them as “total crap.” The statement went viral before “viral” was even a thing, wiping £500 million off the company’s value almost overnight. Ratner’s Group never recovered, proving that sometimes, silence really is golden.
10. HP and Autonomy’s Ill-Fated Acquisition
In 2011, Hewlett-Packard (HP) purchased Autonomy, a UK software company, for a staggering $11 billion. It turned out to be a disastrous move. Within a year, HP had to write down $8.8 billion of Autonomy’s value, citing “serious accounting improprieties.” This acquisition is a textbook case of due diligence done poorly, with a side order of buyer’s remorse.
11. The Sega Saturn Surprise Launch
Sega, hoping to outmanoeuvre Sony’s PlayStation release, launched the Sega Saturn in 1995, four months ahead of schedule. Retailers and developers were caught off guard, leading to a lack of available games and retail support. The PlayStation dominated the market, and the Saturn quickly faded into obscurity, a stark reminder of the perils of premature launches.
12. Ford Edsel: The Car That Crashed
In the late 1950s, Ford introduced the Edsel, a new car named after Henry Ford’s son. Despite a massive marketing campaign, the Edsel was a commercial flop. It was overpriced, overhyped, and underwhelming in design. Ford lost $250 million on the Edsel, making it a byword for corporate hubris and market misjudgment.
From fizzy drinks to digital domains, these tales of woe remind us that even the mightiest can falter with a single misstep. But fear not, for in the long history of business blunders, there’s always a silver lining: a lesson learned, a laugh shared, and the comforting thought that, surely, it can’t happen again… right?
And as for those of us running much much smaller companies, perhaps we can rest assured that’s not likely our own bad decisions will make it into the business history books.
