It can work. But you have to devote the necessary resources to scouting and your drafting plan has to be sound and you need a little luck as well. And you need deep pocketed owners that can handle the lean years which as we have seen can really pile up.
Luck and scouting.
We have example of Detroit. They had bad scouting with Holland. And now they have good with Yzerman, who made very good picks with Seider, Edvinsson and Raymond. And I think Kasper is a good one too. But even than it`s not enough. 7 years without play off with 3\4 good-to-great picks, but they are far away from building contender. I believe they will build strong defense, but they don`t have top offensive talent still. They were not lucky with having Holland, they were not lucky with lottery. And even with 3-4 good picks out from 6 drafts they are not so close to being build. For example our retool started in 2015, we drafted Zacha, Mcleod, Hischier, Smith, Hughes and Holtz by our first first picks in the first(a lot of first word) 6 years. Only two really good picks(at least for now). But Fitz made right pick after Holtz and we were lucky to draft Bratt in later round. And he made another good pick little bit later to trade the prospect with picks and another lower potential prospects for Meier.
And Detroit`s scouts made some another good picks - Berggren, Soderblom, Mazur could be something.
Draft is an important part but even with good scouts it`s not enough. Team needs luck on the draft to find top nhl talents.