How to pivot business during a crisis
‘The art of life lies in a constant readjustment to our surroundings’
— Kakuzo Okakura
Every business experiences difficulties on their journey to success. It is important to keep in mind that when the going gets tough, and you face insurmountable challenges, pivoting might help you revise your strategy and take an alternative approach.
Given uncertain circumstances, remote working and virtual methods of working will continue to trend for some time. It is vital to align with your team on your business goals and onboard new tools and technologies that can positively reinforce the digitisation of your business.
Prior to the pandemic, many small startups were hesitant to change their ways as they were already standing on shaky ground. However, the pandemic brought exceedingly high expectations from customers and a realisation that the marketplace needs to adapt quickly to stay in the game.
Many tech startups already work in the digital space and have shielded from the pandemic crisis. For many others, pivots are necessary in this situation as a source of growth and value creation.
Pivoting can be as simple as changing the channel at which your platform or product is provided (from mobile app to software or vice versa), to employing a new revenue model to increase monetisation, such as focusing on a different segment of the population or providing your service to businesses rather than customers (e.g. pivoting to a B2B/B2C model).
Conducting a Successful Business Pivot
Often pivoting is perceived as a magic pill that can solve any problem your company is facing. Instead, it should be backed by clear evidence and well thought-through. As pivoting represents a shift in the focus of your company or the way your business model operates, it is a significant step to take.
We’ll start by looking at some general rules, and then we will see how they apply to a situation of crisis. So what are some signs to take into consideration before pivoting and how do you do it effectively?
Don’t react but act quickly
If your offering has gained traction and interest with your customers, but you’re progressing slowly despite the amount of work you’re putting into it, you might need to consider re-evaluating your revenue model, market or product/service.
Remember, pivoting is not a milestone but an alternative method of operating. Many companies pivot multiple times and quite often miss the opportunity to execute on their ideas early enough. For instance, if you have been meaning to invest in your business’ digital presence in the wake of a crisis (like COVID19), implement a marketing strategy as early as possible to avoid wasting time, effort and money. This will allow you to remain competitive on the market.
Pause and reflect on your vision
Launching and running a successful business is not easy. If the path your business is on doesn’t feel right, if a red flag is raised concerning the efficiency of your operations, it is vital to pause and reflect on the big picture.
Take the time to listen to your most important asset, your team, and invest time in gaining a fresh perspective on the company’s long-term goals and vision.
Through these insights, you can start to channel efforts in the right direction and ultimately initiate a change by strategically transforming your business model.
Keep the good practice
Keep in mind that pivots don’t necessarily refer to exhaustive changes. It’s important to pinpoint what aspects of your business can be maintained once you’ve agreed on a new direction.
Acknowledge all the effort, time and energy spent on building this business and ensure you hang on to the practices that have helped you get to this stage. These can be your leadership style and the agility you have developed in creating a unique working culture and team dynamic.
As the Chinese proverb goes, the wise adapt themselves to circumstances, as water moulds itself to the pitcher.
Take client feedback into consideration
The feedback you receive from your clients is a useful indication for whether you should consider a business model pivot or not.
While constructive feedback on a regular basis is expected, watch out for clear trends that emerge around specific areas of the business. For instance, consistent feedback regarding the customer support system (e.g. “low response rate”), or the product features (e.g. “there aren’t enough features”) may be an indicator that you should take the time to interview some of your clients and take some of their points into consideration.
Growth Opportunities
Below are some examples of technological adoption that present growth opportunities:
Use of Smart Technology
Startups can engineer a way to adopt various emerging technologies like VR systems (e.g. in the property sector, to visualise flats) and Machine Learning (e.g. to encourage deep learning from trends that have emerged in the recruitment space during COVID-19), among many others, to provide a platform for businesses to innovate and address new problems.
Chatbots and RoboAdvisory
Over the last decade, Chatbots have replaced real time customer support. 24/7 service chatbots allow companies to provide round the clock assistance to queries and have helped cut operational costs. This not only amplifies practical efficiency but also caters to increased and speedy response rates that serve multiple purposes (e.g. customer service or in some cases, advertising).
Age of Digitalisation
This pandemic can be looked upon as an opportunity for small physically operating startups to explore the digital world. Businesses that haven’t done well during the crisis must ask themselves how they can improve their market position. To reach new levels of growth, businesses can take advantage of offering their services remotely through digital channels.
What does the Future Hold for Businesses?
Launching and managing a company is charged with many risks. Yet, when it comes to planning for success remember that preparation and execution is everything. Trying to make strategic decisions without prior thinking is risky. So, before you choose to pivot your company in a new direction, take the time to pause and prepare.
Once the world manages to sweep out of the crisis and things move towards “normalcy”, we will see a complete paradigm shift as more and more consumers will rely on digital, convenient methods of satisfying their needs.
How will you prepare and adapt to the current changes?
