Assumptions are like invisible ink—they seem harmless until they’re exposed to light. And when your strategy is built on them, it’s not a matter of if it will collapse, but when. From corporate disasters to personal missteps, assumptions are the silent saboteurs of success. So, let’s pull back the curtain and see why betting on assumptions is like playing Jenga with your future.
Ever tried boarding a flight without checking the departure time? Or walking into a boardroom and assuming everyone already agrees with you? Sounds reckless, right? Yet, companies do this all the time—crafting multi-million-dollar strategies based on gut feelings, outdated “truths,” and wishful thinking. Spoiler alert: Reality doesn’t care about your assumptions. From billion-dollar failures to historic corporate face plants, the world is littered with the wreckage of leaders who assumed instead of verified.
The graveyard of certainty is where brilliant strategies go to die. Kodak‘s senior executives held the first digital camera in their hands—their own engineers invented it in 1975—and promptly buried it like a murder weapon. Their assumption? “No one will ever abandon film.” That $100 billion company now trades as a penny stock. Meanwhile, Blockbuster‘s CEO laughed Netflix‘s founders out of his office when they proposed a partnership. His assumption? “Americans will always want the experience of browsing video stores.” Which is why your children think “Blockbuster” is a vintage clothing brand. Welcome to the corporate slaughterhouse, where the murder weapon is always the same: unexamined assumptions.
The cost of comfortable certainty– Nokia‘s engineers assumed hardware would always trump software. BlackBerry believed business users would always prioritize security over apps. Meta bet $10 billion that people actually want to attend virtual work meetings as cartoon avatars. The more certain the assumption, the more catastrophic its failure. When Microsoft assumed the smartphone was a passing fad, it cost them an entire technological generation.
The demographic delusion – “Millennials don’t buy diamonds.” “Gen Z won’t pay for subscriptions.” “Boomers don’t shop online.” These age-based assumptions have all proven catastrophically wrong. When De Beers assumed younger generations wouldn’t want diamonds, lab-grown startups captured billions in market share by understanding the actual objection was ethical sourcing, not the product itself. Demographics predict far less than values and behaviors. RIP Demographics!
Assumptions vs. Data: The Battle for Clarity– Data is the antidote to assumptions. But too often, we ignore the numbers and go with our gut—because, well, it’s easier. Google’s success is built on data-driven decisions. They test everything—from button colors to algorithms—because they know assumptions are the enemy of innovation. Data doesn’t lie, but it does have a terrible sense of humor. Assumptions, on the other hand, are hilarious—until they’re not.
McDonald’s assumed it could sell burgers in Bolivia—Bolivia disagreed– The fast-food giant assumed that Bolivians would love a Big Mac just like everyone else. Turns out, Bolivian food culture values home-cooked meals, not fast food. After years of losses, McDonald‘s shut down all stores in Bolivia. Global strategies fail when they ignore local realities.
What do Titanic, Nokia, and New Coke have in common? They all sank—because someone, somewhere in a fancy boardroom, made a really dumb assumption. “This ship is unsinkable!” till iceberg says hello. “People will never give up physical keypads!” till Hello, iPhone.“Sweeter Coke? What could go wrong?” Well, everything.
Corporate history is littered with train wrecks disguised as strategic decisions. Why? Because instead of checking the facts, executives play business on “gut feeling” mode. The result? Strategy built on assumptions is like a parachute made of toilet paper. It might work—but you really don’t want to find out.
WeWork assumed it was a Tech Company—turns out, it was just fancy real estate- Adam Neumann told investors that WeWork was a tech revolution—not a real estate company with WiFi. Investors drank the Kool-Aid, and the company was valued at $47 billion. Reality check: The IPO prospectus revealed a dumpster fire of bad finances, and WeWork crashed harder than a cheap office chair. The lesson here is- Branding can’t fix a broken business model.
The Focus Group fallacy – No one in a focus group ever asked for an iPhone, Netflix, or Red Bull. People don’t know what they want until you show it to them. When Sony asked customers what they wanted in portable music, they described a better Walkman—not the iPod that would destroy Sony’s music business. If Henry Ford had asked people what they wanted, they would have said “faster horses.” Your customers can tell you what they hate, not what they’ll love. We over-index on the ” Customer is always right narrative. At best, they are mostly late “. Lesson: “Don’t find customers for your products; find products for your customers ” .
The disruption myth– Disruption isn’t what you think it is(though we have been sold that lie for ages). It’s not about technology; it’s about business models. Netflix didn’t kill Blockbuster with streaming technology; it killed it with a subscription model. Amazon didn’t kill retail with websites; it killed it with ruthless logistics and razor-thin margins. Uber didn’t kill taxis with an app; it killed them with a labor model that didn’t require medallions. The most dangerous assumption is that innovation is about products when it’s actually about economics.
The competitive blindspot – Borders was watching Barnes & Noble while Amazon was watching Borders. Hotels were obsessing over each other’s loyalty programs while Airbnb was eating their business. Your competitor isn’t who you think it is—it’s who your customers think it is. While you’re perfecting your horse-drawn carriage, someone else is inventing the car. And they’re not even thinking about you.
Assumptions are like GPS directions from your uncle who hasn’t left his neighborhood since 1998. Sure, he sounds confident, but you’re probably going to end up in a ditch.
The difference between strategy and gambling isn’t the absence of assumptions—it’s the recognition that they exist. The most dangerous assumptions aren’t the ones that prove wrong; they’re the ones you never acknowledged making in the first place. Perhaps the most valuable strategic exercise isn’t creating the perfect plan, but ruthlessly hunting down the hidden assumptions that your beautiful strategy depends upon. After all, gravity doesn’t care if you believe in it before you jump off the cliff. Your assumptions are invisible until they fail—and then suddenly, they’re the only thing you can see.
The Assumption Tax is what your strategic certainty really costs! Assumptions don’t build businesses. They bury them. So, the next time you’re about to say, “I think customers will love this,” stop. Ask yourself: “Do I think it, or do I know it?”
Because in business, the difference between assumption and reality is often the difference between success and bankruptcy.