I remember years ago attending a science conference in Salt Lake City, Utah. One of the hot-button issues was the routing of rivers in the American West. I visited a booth with a wide table that angled down toward the floor. Sand covered the table’s surface and a small hose was positioned at the high end of the table. When a presenter turned on the hose, a thin stream of water began to run down the middle of the sandy surface.
For a moment, the water traveled in a semi-straight line. But as it navigated the idiosyncrasies of the sand, it twisted and meandered its way down to the bottom of the table. The water was shut off and the sand smoothed out, and the experiment was repeated. Again, the water traveled in unpredictable ways. It was as if gravity barely had an influence as it flowed like a twisting ribbon.
The point of the presentation was to show the natural course of rivers, opposed to the unwaveringly unnatural paths of channelized rivers. In the past, if the river in your city was too meandering for your preferences, you simply dug a straight trench and turned the river into a glorified irrigation ditch.
Why do I bring up the topic of naturally flowing rivers versus the straight routes of human-made channels? Because small businesses need to take cues from both of these phenomena. First, you need to be focused and forward-moving like a channelized river. But you can’t be immovable. When factors arise, trends emerge, or disasters strike, you need to be able to nimbly react. You see, the ability to pivot business is what separates you from the RadioShacks of the world.
No single event in our lifetimes has reinforced this truth more than the COVID-19 pandemic. Even the most rigid businesses were forced to adapt or face grim results. And even as the world begins to cautiously emerge from the trauma of lockdowns, uncertainty abounds. Global cases seem to spike just as often as they decline, suggesting more volatility in the future. But you can harness that volatility into something positive.
“Through all the challenges and struggles caused by the coronavirus pandemic, there has been an outpouring of care, creativity, and innovation,” says small business expert Derek Miller. “Artists have moved their performances and pieces online, wowing audiences and helping them through periods of anxiety and stress. Businesses have found new ways to thrive, changing direction by reaching new audiences or offering new products at speeds that would have seemed impossible 6 months earlier. You can be part of this change. If you have reached a crossroads where you need to pivot to survive, know that the challenges you face can help you grow your business and come out on the other side stronger than ever.”
Of course, there’s nothing easy about changing your business operations. A pivot can be frightening and difficult. But if you move like water downhill, you can let the obstacles you encounter serve as guides for which way you should turn. And the momentum of your business can continue to carry you in the right direction.
Understanding a Business Pivot
There will always be varying degrees to words. If an entrepreneur announces they’re pivoting their business, it could mean as many different things as if that entrepreneur were to say that they’re dating someone. The term “dating” could mean that the couple went out for dinner once and they are considering doing it again. Or it could mean they have been together for 11 months and spend holidays in each other’s hometowns.
In its simplest form, pivoting means that you are changing a strategy. For example, you might be adjusting the way you ship your products to better align with the current business environment. Or you might be adjusting what you’re shipping, meaning a total reconfiguration of your production process. But let’s not stop there. Pivoting could also mean dropping the shipping model altogether and moving to a digital product that requires no production or shipping and can be resold in the blink of an eye.
Here are some examples of possible pivots that a small business might consider:
- Targeting a customer base in a new way
- Targeting a new customer segment
- Introducing a new product
- Expanding an existing product
- Minimizing an existing product
- Dropping an existing product
- Manufacturing an existing product in a new way
- Delivering an existing product in a new way
- Introducing a new service
- Expanding an existing service
- Minimizing an existing service
- Dropping an existing service
It’s true that some of the actions on this list might seem more like adjustments than pivots. But in certain situations, a small business might be required to undergo a drastic change in order to bring them to pass. So if the energy required is substantial, you can probably refer to it as a “pivot.”
To Pivot or Not to Pivot?
It can be tempting to look at a pivot as a cure. You might look at plummeting sales and think, “I need to pivot in order to save my business.” But this misguided approach takes the strategy out of the action and places the focus on simply doing something different.
What your business needs is a brilliant idea that is profitable, connects with customers, and stands out from the competition. The process needed to bring your idea to life is what you might refer to as the pivot. But pivots don’t save businesses any more than obtaining a business license is what made Apple a worldwide technology leader.
Brilliant ideas don’t come easy. If they did, your competitors would probably already have them out in the market. But you can take comfort in knowing that the very obstacles you’re facing can serve as muses to inspire your mind. For example, when some distilleries faced plummeting sales during lockdown, they looked at how their businesses could actually contribute beneficial solutions to the specific factors that were killing their revenue. Within weeks, some of these distilleries were selling hand sanitizer.
Is a pivot in your future? If you answer “yes” to a couple of the following questions, it might be.
- Have your sales stagnated?
- Is your customer base shrinking?
- Are your competitors crowding you out?
- Is a flagship product or service floundering?
- Have you identified an opportunity tied to the current environment?
Whether a brilliant idea hits you in the shower or during an hours-long brainstorm, the important thing is that your plan meets needs other than your own. You must step outside of your role in the company and sincerely ask if the idea you’re proposing will allow you to redirect around an obstacle like water does so that you can keep moving confidently toward your destination. If you only worry about what you want out of the pivot, your progress will easily be halted and you could end up in a worse spot than where you started.
“The pandemic highlighted the importance of meeting customer needs,” insists small business writer Katherine O’Malley. “For example, any retail store that didn’t implement BOPIS (buy online, pickup in-store) probably lost revenue as customers demanded it and will continue to use it in the future. Businesses will need to ‘develop a systematic understanding of changing habits’ to survive as customers will continue to evolve—the next shift in customer needs is simply one pandemic, hurricane, or technology change away. Successful businesses have always been creative and adaptable. While the coronavirus pandemic is a horror-show no one wants to ever repeat, there is some comfort in the positive ways businesses may have changed forever.”
Your customers are an amazing source of wisdom, so look to them. Perhaps their actions will speak so loudly that you will be able to discern the strategies necessary to meet their needs. Or you might need to reach out to them and ask. A simple SurveyMonkey email can yield amazing insights into how you can better reach them and make their lives easier.
Tips to Help You Successfully Pivot Business
Once you’ve identified a new way to move your business, it’s time to put your strategies into action. Your timeline will require a delicate balance, as you’ll face dueling pressures. For starters, you’ll feel the need to do your due diligence. Think back to all the research that went into starting your business in the first place. This pivot should be handled with similar (albeit less intensive) thoughtfulness and care.
On the other hand, your brilliant idea is piping hot out of the oven and needs to be served before it gets too cold. Each day you unnecessarily delay only adds to the costs and potentially mitigates its positive impacts.
Only you will know how fast to proceed, as there’s no universal cadence. Just remember to match your enthusiasm with an equal dose of research so that you’re able to effectively land the pivot.
Here are some additional tips to guide your pivot in a way that brings lasting results:
Don’t Feel the Need to Throw the Baby Out With the Bathwater
Some business owners equate a pivot with completely giving up on their current operations. Nothing could be further from the truth, as you will typically be able to retain many of the best aspects of your business.
Think back to the example of distilleries pivoting to hand sanitizer during the pandemic. These businesses maintained nearly all of their fundamental operations, with the biggest change coming in the form of the product they were shipping out of their warehouses. Countless modifications were clearly required, but it was a redirection of their future rather than a repudiation of everything they’d been doing in the past.
Check In On Your Competitors
Brilliant ideas usually have a distinct nature to them, but that doesn’t mean other businesses are doing something in a similar vein to what you’re planning. Be sure to research the market and see how your pivot will play out among competitors.
Once again, this is a time when you’ll need to distance yourself from the emotional bond you feel with your idea. Ruthlessly consider how your strategies would compare to the competition and how they might be received by customers.
Clearly Communicate Your Idea
Speaking of your customers, it’s essential that you stick close by them throughout the pivot. You’ll need to convey why you’re adapting and how it will benefit them. Never rely on them to extrapolate these facts on their own. Your ability to connect with them will come down to how well you know them.
“During this period, you may need to conduct first-hand research to understand your audience,” says Miller. “Any data before 2020 is likely outdated if your customers’ behavior changed dramatically during the pandemic. Take time to learn what your customers are doing and what they are feeling during this time.”
By letting your customers in on your business secrets, you establish a symbiotic relationship that sets your business up for lasting success.
Seek Input From All Angles
There’s no doubt that you’re a smart individual. After all, it takes brains to start a business. But you don’t own the exclusive rights to brilliant ideas for your business. In fact, many of the best strategies will come from other sources. These include:
- Your Uber driver
- Your aunt
- Your spouse
- Your child
- Your colleague
- Your barista
- Your mechanic
- Your LinkedIn contact
- Your doctor
- Your mentor
- Your nemesis
The thing is, none of these sources are available if you don’t allow them to be. When was the last time someone grabbed you and proclaimed, “I have an idea you simply must listen to!” Develop a reputation as someone who respects the insights of others, then live like a sponge so that you can collect any and all wisdom that’s emanating from those around you.
Foster a Culture of Boldness
You can help prime the pump by letting your employees know that it’s OK to take bold steps into the dark. When others believe that you have the courage to run with new ideas, they’ll be more likely to offer them up.
But it’s more than just expanding the source of new strategies. You must have your employees’ buy-in for any pivot to succeed. To ensure your pivot is an all-hands-on-deck operation, communicate your reasons for change, seek input, provide updates, and build a shared enthusiasm for the future.
Conduct a Test
Even the best ideas are best handled with a scaled approach. So if you think that your bakery should convert to a shop that sells custom purses, don’t sell those ovens quite yet. Start by experimenting with your ability to create and sell these purses.
“One of the main ways to reduce the risk associated with change is to only make it temporary,” explains Miller. “Instead of viewing your pivot as a dramatic change, test out a few new options and see how your customers respond. Testing isn’t anything new. Businesses have been testing new services and products through pop-up shops or testing markets for decades […] If your customers like the experience, you can start building excitement for when the change becomes permanent.”
Yes, it all comes down to confirming what you believe. Imagine how much more confidently you can move forward once you’ve proven the feasibility of your plan and seen the positive reactions.
Finally, Proceed With an Open Mind
Your team could dedicate an entire year to research and planning, then watch your business pivot go in completely unexpected directions. For this reason, you’ll need to embark on this adventure with a healthy dose of flexibility.
When you pivot business operations, always keep your foot on the gas pedal and your hand on the wheel. Building positive inertia helps you navigate the unexpected without stalling. Because nothing kills team morale faster than getting stuck in the small business doldrums, where you sit around in a confused and frustrated state.
Of course, all this forward-moving talk needs to be balanced with the idea that it’s OK to take your foot off the gas if you discover that your pivot is not everything you hoped it would be. Never let your idea forcefully drive your business into even more serious problems.
As long as you learn from the experience, you’ll be better informed and equipped for your next business pivot. Some pivots will be smash successes and others will provide harsh lessons, but they’ll all benefit your business.