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Designed to Fail

Intentionally launching flawed initiatives to occupy, fragment, or poison a market before it can pose a threat.

"Removing potential future threats by poisoning a market space before anyone attempts to establish it."

  • Simon Wardley

🤔 Explanation​

What is Designed to Fail?​

This is a strategy of tactical sabotage: deliberately introducing a doomed initiative into an emerging space to distort perception, drain competitor resources, and reduce the likelihood of serious market formation.

The aim isn’t to win the market—it’s to ruin it, or at least delay its maturation until you’re ready.

You might:

  • Launch a community standard with governance deadlocks
  • Publish an open-source library with scalability flaws
  • Fund a startup with unworkable economics that shapes expectations

These efforts occupy mindshare and fragment momentum, discouraging others from investing.

Why use Designed to Fail?​

Deploy this strategy when an adjacent or emerging market may threaten your core position. By seeding a flawed initiative, you can:

  • Prevent competitors from gaining traction.
  • Channel resources away from more impactful ventures.
  • Shape market perceptions to your advantage.

🗺️ Real-World Examples​

HD DVD Format​

Toshiba's HD DVD was launched alongside Blu-ray, fragmenting the high-definition disc market. Although technically competent, lack of studio support and deliberate confusion led to its swift decline, deterring new entrants.

Hypothetical IoT API​

A vendor-funded IoT API with inadequate security standards is released. Early adopters face breaches, tarnishing the space and discouraging competitors from similar efforts.

🚦 When to Use / When to Avoid​

🚦 Designed to Fail Strategy Self-Assessment Tool

Find out the strategic fit and organisational readiness by marking each statement as Yes/Maybe/No based on your context. Strategy Assessment Guide.

Landscape and Climate

How well does the strategy fit your context?

  • An adjacent market is forming, but lacks standards or strong leaders.
  • We risk disruption if a serious player takes root there.
  • We have the credibility to seed a plausible initiative.

Organisational Readiness (Doctrine)

How capable is your organisation to execute the strategy?

  • We can resource a short-term launch without long-term dependency.
  • We have legal clearance and PR buffers in place.
  • We know how to shut it down cleanly.

Assessment and Recommendation

Strategic Fit: Weak. Ability to Execute: Weak.

RECOMMENDATION
Consider alternative strategies or address significant gaps before proceeding.

LowHighStrategic FitHighLowAbility to Execute

Use when​

  • A threat is emerging in an ungoverned adjacent market.
  • We can sustain the initiative long enough to signal occupancy.
  • The tactical benefit outweighs the resource cost.

Avoid when​

  • The initiative risks being corrected or improved by the community.
  • Legal or brand risks outweigh strategic gains.
  • Stakeholders demand transparency that undermines the tactic.

🎯 Leadership​

Core challenge​

Leadership tension: Playing dirty without eroding trust or morale. This tactic rewards dispassionate analysis and ruthless prioritisation. Leaders who hesitate to pull the trigger, or can’t contain the fallout, should avoid it.

Key leadership skills required​

  • Cold strategic judgment
  • Reputational risk calibration
  • Legal/PR coordination
  • Fast-response governance

Ethical considerations​

This strategy walks a line between cunning and deception. Overuse breeds cynicism inside and outside your oranisation. If discovered, you risk brand damage and trust collapse.

📋 How to Execute​

  1. Identify a vulnerable or emerging market segment.
  2. Design an initiative with surface credibility but hidden flaws.
  3. Launch with marketing or partnerships to appear legitimate.
  4. Maintain control over governance and contributions to prevent self-healing.
  5. Monitor engagement and competitor responses.
  6. Allow the initiative to collapse once competitors are deterred.

📈 Measuring Success​

  • Competitors refrain from entering the target space.
  • Initiative adoption appears sufficient to signal occupancy.
  • Resource expenditure stays within planned bounds.
  • Competitors divert resources from strategic projects.

⚠️ Common Pitfalls and Warning Signs​

Unintended Adoption​

Competitors or communities may fix flaws, turning the initiative into a viable offering.

Rapid Correction​

Open-source or industry groups could standardize gaps, neutralizing the tactic.

Reputational Damage​

Exposure of the tactic can erode trust with customers and partners.

Resource Drain​

Maintaining a deceptive initiative may consume more resources than planned.

🧠 Strategic Insights​

Governance Vacuum is Key​

This strategy thrives where no one yet has control. A lack of established standards, dominant players, or clear leadership in an emerging market allows a "Designed to Fail" initiative to more easily shape perceptions and create confusion. The ambiguity of a nascent space is the fertile ground for such a ploy.

Narrative Dominance is Crucial​

The success of a "Designed to Fail" initiative hinges on controlling the narrative. The flawed project must be marketed with enough credibility and fanfare to appear legitimate, occupy mindshare, and influence competitor or ecosystem behavior. Without a convincing story, the flaws become obvious too quickly, and the strategic intent is lost.

The "Osborne Effect" Multiplier​

A well-publicized "Designed to Fail" initiative can generate an "Osborne Effect" in the targeted market. By hinting at a superior (but ultimately undelivered) future product, it can deter customers from purchasing existing, viable solutions from competitors, effectively freezing demand and poisoning the market by creating widespread purchasing hesitation.

Ecosystem Contamination and Resource Burn​

Beyond direct competitors, a sophisticated "Designed to Fail" play can contaminate the adjacent ecosystem. By launching a flawed standard or platform, it can entice third-party developers, integrators, and investors to commit resources. The inevitable collapse wastes their investment and creates disillusionment, making the entire field appear barren and raising barriers for future legitimate efforts.

Strategic Misdirection: The "Empty Fort" or "False Scapegoat"​

"Designed to Fail" initiatives can serve as powerful misdirection. Like an "Empty Fort," a visible but hollow show of occupying a space can make competitors overestimate your commitment, causing them to hesitate or misallocate resources. Alternatively, it can be a "False Scapegoat," providing a public reason for retreating from a market due to the initiative's "failure," masking deeper strategic shifts or internal weaknesses.

Short Half-Life by Design​

These initiatives are not meant to last. Their purpose is to occupy space, create temporary distortion, or achieve a specific signaling effect. If a "Designed to Fail" project persists too long or, worse, accidentally becomes viable (perhaps through community fixes), it risks failing in its strategic objective of denial or delay. Plan for its eventual, controlled collapse.

Best as a Tactical Side-Play​

"Designed to Fail" should generally be a tactical, peripheral move rather than core to a company's primary strategy. Its utility lies in specific, often defensive, contexts. Over-reliance on such "poisoning" tactics can distract from genuine value creation, damage reputation if discovered, and foster a cynical internal culture.

❓ Key Questions to Ask​

  • Threat Identification: Which adjacent emerging markets pose strategic risks?
  • Sustainability: Can we maintain a credible surface while embedding flaws?
  • Exit Strategy: How will we decommission the initiative without collateral damage?
  • Risk-Reward Balance: Do potential benefits justify reputational and legal risks?

🔀 Related Strategies​

  • Misdirection — using narrative to divert attention.

  • Sweat & Dump — handing off toxic projects.

  • Insertion — embedding flawed influence via people.

  • Licensing — controlling ecosystems through legal terms.

  • Standards Game - introducing deliberately flawed specifications to fragment competitor ecosystems and clear the path for your own standard.

⛅ Relevant Climatic Patterns​

📚 Further Reading & References​

Author

Dave Hulbert
Dave Hulbert
Builder and maintainer of Wardley Leadership Strategies