Relying on hope is not a strategy for continued success
By Gerhard Apfelthaler
Few phrases are as iconic, cautionary, and maybe overused as “hope is not a strategy.”
Popularized by a book published in 2003, it is a reminder that while optimism is important, success ultimately hinges on other things — understanding your environment, setting your goals, charting a course, and then executing, executing, executing.
Too often, hope becomes a substitute for the hard work and rigorous thinking that business challenges demand.
Keeping a positive attitude is always a good thing but hope all too often also carries a sense of hopelessness and inaction.
For aspiring entrepreneurs, seasoned executives, and — frankly — all of us alike, it is crucial to recognize that while hope fuels perseverance, it cannot replace strategy.
According to 2024 data from the Bureau of Labor Statistics, 20% of companies close in their first year, and nearly 50% close by their fifth year.
Not even 50 companies in the United States are in the 70-year club of the Fortune 500!
Without a sense of hope, it would probably have been impossible for the “survivors” to weather uncertainty, financial crises, shifts in technology and consumer behavior.
On the flip side, however, all of those companies that have disappeared certainly were hopeful — often until the day they closed shop.
Hope is certainly a motivator that allows leaders and organizations to push forward despite the odds, but it’s certainly not what makes them succeed.
When hope is misapplied as a decision-making tool, it can lead to disastrous outcomes.
Take, for example, businesses that disregard market conditions will continue indefinitely, ignoring even the weakest of signals.
Even if business is fine in the present, relying on internal stability is deceiving and can be a major impediment to business survival when the external environment changes.
The landscape is littered with examples — Blockbuster’s video rental business went under when Netflix offered a more convenient mail-to-home option; Netflix, in turn, survived as it pivoted to streaming.
With the emergence of competitors, Spotify made a major shift to podcasts.
During the Covid-19 pandemic, some retailers shifted to online business, home delivery, and innovative partnering strategies while others went out of business.
Southern New Hampshire University, to cite an example from my own industry, was once an obscure small college on the brink of extinction but is now a dominant player nationally with more than 170,000 students due to its shift to online learning.
However, 500 other colleges in the U.S. closed their doors in the last 10 years.
Hope, in any of these cases, did nothing to protect these companies’ interests.
Strategic foresight, on the other hand, could have.
There is a tendency to fall into wishful thinking, where one hopes that problems will solve themselves, that everything will return to “normal,” or that external forces will change for the better.
In organizations, wishful thinking can take many forms.
It might include believing that customer behavior will magically shift to align with a company’s flawed product or service.
It might involve an entrepreneur waiting for an investor to appear without actively pitching.
It might rest on the assumption that your competitors are asleep at the wheel.
A winning strategy comes from grounded analysis of the external environment, understanding the internal environment, building a winning business model, drafting a real strategy, forecasting, action, and flexibility.
It requires organizations first and foremost to understand their current and future customers, to assess competitor behavior, and to continuously iterate on their products or services.
Organizations must foster a culture of strategic thinking within their organizations — one that encourages calculated risks, celebrates learning from failure, and demands accountability.
Organizations who rely too much on hope often avoid difficult decisions.
They postpone cost-cutting measures, delay product improvements, keep outdated structures and processes in place, and shy away from making changes in leadership.
Often, they distract themselves with meaningless adjustments at the fringes — putting lipstick on a pig, as they say.
One of the most telling examples of the importance of market-driven strategy comes from the startup world.
A common piece of advice for entrepreneurs is to focus on building a Minimum Viable Product (MVP) — a lean version of their product with just enough features to satisfy early customers and gather feedback.
The MVP approach forces entrepreneurs to think strategically, relying on data and customer validation rather than just their hopes and dreams for the business.
It’s a simple concept: instead of hoping your grand idea will work, test it. Learn from your customers, adapt quickly, and evolve your product based on real-world feedback.
Management professor Henri Mintzberg has once famously described strategy as “muddling through” and he has — maybe cynically — commented that in hindsight everything looks like a strategy.
While this may be true for some successful organizations, it is certainly not for the majority, especially not for those who have disappeared into history.
Hope should be a source of inspiration for all of us, but it is strategy that ultimately wins the day.
Gerhard Apfelthaler is a professor of International Business and the dean of the School of Management at California Lutheran University.
