Change and transformation are a natural part of building and managing a business. Here’s what you need to know about pivoting your business to success.
How to successfully pivot your business?
As an entrepreneur or business owner, you must always be prepared to navigate through uncharted waters when customers’ attitudes and needs change or the business environment becomes turbulent. And sometimes this may mean having to start from scratch and abandoning everything you’d previously invested in the business.
This is especially true as the world navigates the worst economic catastrophe in modern history. The spread of COVID-19 forced many businesses to quickly adjust their strategy to keep their companies.
But pivots aren’t just about adjusting to disasters. Even when everything in your business is going well, a time may come when you feel it’s time to optimize your sales funnels or reposition your product in the market, and the only thing that makes sense is to forego the original business model and start over.
Essentially, that’s what a pivot is all about—shifting to a new business model or strategy to survive in the market or increase revenue. Twitter, Slack, Starbucks, YouTube, Airbnb, Instagram, and Starbucks are just a few companies that have pivoted towards success.
However, pivoting isn’t a cure-all for businesses that aren’t satisfied with their growth trajectory. For starters, there’s a right and wrong time to pivot. Secondly, how you pivot can mean the difference between success and failure.
1. Conduct Market Research
Every business is built around meeting a specific customer need. And when there’s a shift in customer attitudes and needs or you want your merchandise to serve a different customer segment than originally intended, you have no other option than to pivot your business with the new goal in mind.
Regardless of the changes you want to make, it’s important that you start by talking to and listening to your customers. Find out how your target audience feels about your business but what struggles they may be going through. Use your customer feedback to make necessary changes to your business model.
Don’t limit yourself to your current market when exploring opportunities in the marketplace. To gain a deeper understanding of your market, conduct market research with emerging industry trends in mind. And since your competition could be in the same situation you’re in, you may need to look at how they’re leveraging their strengths and strategies. You can adapt the winning strategies and find ways to reinvent their missteps to gain a competitive advantage.
Also read: How to start a tutoring business online
2. Write a New Business Plan
As mentioned, you can’t avoid change when running a business. And when change comes, even the most comprehensive and well-crafted business plans require a re-do. It would be virtually impossible to reassess and repurpose your business model without adjusting your business plan accordingly.
It’s important that you develop a new business plan that will not only help check the feasibility of the changes but also give a holistic picture of how the transition process will look like. The idea is to review your current plan and come up with a new one that includes all the elements needed to ensure the pivot delivers the positive results you want.
Make sure your plan covers the new financial obligations, product changes, revamped business processes and operations, altered distribution channels, and a realistic schedule for completing the pivot. Use a business plan template that caters to your industry as a starting point.
3. Lean on Your Core Competencies
Don’t let your previous struggles and challenges go to waste. Just because your initial idea didn’t work or there was a shift in customer needs doesn’t necessarily mean your business has failed. And by choosing to pivot, you’re simply implementing a slight variation in the processes or model your business will take to accomplish a specific goal.
No matter how tempting it is, don’t stretch too far outside your line of business or skill set. It’s important that you maintain your company’s identity and lean on your core competencies and strengths even as you repurpose your business strategy and reposition your brand in the market.
Also read: Hire a business plan writer
4. Start Small to Mitigate Your Risk
If you’ve ever undertaken any strategic change in your company, you know how challenging it can be to monitor and track performance. Plus, there’s always a level of risk that comes with the change. You’re already dealing with uncertainties and the last thing you should do is change your entire business model at once.
The best option is to implement small changes gradually, so it’s easy to monitor how things are working. Test the new business model within a defined time period, allowing your team to put less than 30 percent of their time into it. You don’t want to spread your employees thin by focusing on so many things that you lose your current customer segment. If possible, develop a prototype and measure its performance in the market.
Further read: How to start a business with no money
5. Communicate Your Changes and Align Your Team
Take the time to create a comprehensive communication plan that will loop in your employees, investors, and current customers. You’ll need to come up with a compelling story that will demonstrate precisely that you’re making the right strategic move. All stakeholders need to see what might have been going awry and how changing course will bring value to the organization.
Keep in mind that some of the investors and clients will be wary of whatever changes you’re about to make. As such, you need to train and equip your frontline employees to answer any questions, address arising issues, or sort out any confusion. Lastly, be empathetic and show continuity, so that everyone can view the changes as an impressive shift and not a sign of unreliability or instability.
Avanti is a voracious reader of books in psychology and physics while being an experienced digital marketeer and ukelele artist. She writes on remote work, technology, space, quantum physics, and productivity.
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