A well-known business book called Good to Great highlights the decisions made by a few select companies on their journey from being good companies to becoming “great.”

It’s an interesting read, and when read through the right lens it can offer some potentially useful insights into business strategy.

But all of the accolades and praise around the genius of the book misses a key point:

You can’t develop a formula for success without looking at the failures.

When I was in high school, my finance class played a stock game. On the first day of class, each student was given $50,000 to invest with the goal of ending the semester with the most money in their fake account.

At the end of the semester, there was a clear trend. Each of the top students in the class had used the same strategy. They put all of their money on a single, volatile stock.

Taking the Good to Great approach, the data was very clear. The best way to make money in the stock market was to put all of your money on a single, volatile stock.

But what we miss is that all of the lowest-ranking students in the class had taken the exact same strategy.

Looking at the top performers didn’t identify the best method, it identified the method with the best upside. It just so happened that this method also happened to have the biggest downside.

Overall, it doesn’t matter if we’re looking at stocks, Fortune 100 companies, professional athletes, or anything else. We can’t just look at the best examples to identify our path. We have to look at the whole picture, including the failures.

-Brandon