Having a reliable pivot strategy in place will help you navigate the ups and downs of the industry. Here are the best methods of pivoting the ever-changing world of business.
For a business to succeed in today’s competitive market, it needs a solid pivot strategy. Pivoting allows a business to respond to crises quickly and efficiently.
With issues like high inflation, having pivot strategies in place will allow your business to survive and thrive. You have to adapt to change to stay relevant and competitive and meet the ever-changing demands of the market.
What Is A Pivot Strategy in Business?
When used in business, the term pivot strategy refers to a planned and dramatic change in a company’s course. This is usually brought on by shifting market conditions, client demands, or internal dynamics.
Pivoting entails reassessing the current target market, product line, and business model to make significant changes to the company’s operations. The goal is to shift and align business processes to accommodate the current trends. By focusing on a new approach that better fits the changing landscape, the pivot strategy enables the company to overcome challenges.
Top Reasons to Pivot
Now that we’ve established what a pivot strategy is and how it helps a business, let’s talk about what drives it. Here are the key factors that determine a company’s need to pivot:
Markets are extremely dynamic and are dependent on various factors, including changes in consumer tastes, economic trends, technological breakthroughs, and industry disruptions. Businesses need to keep an eye on these changes and modify their tactics as necessary to be competitive.
As an example, the growth of e-commerce has forced conventional retailers to create online platforms and modify their business strategies.
Over time, customer demands and expectations change. Businesses must continuously evaluate consumer feedback, market research, and trends. This way, they can better comprehend their target market and deliver goods or services that satisfy their shifting needs. Market share and competence can decline if you don’t adjust to changing client preferences.
Technological advancement is significantly influencing and driving change in the business landscape. With tech giants introducing new tools every year, they tend to disrupt various industries. And if companies fail to adapt and integrate these new technologies, they risk falling behind their competitors. For example, companies that didn’t jump on the digitalization trend now face the challenge of reaching wider, tech-savvy consumers.
Competitors are continuously looking for ways to gain an advantage, which frequently entails launching novel goods, services, or business strategies. Businesses need to keep an eye on what their rivals are doing. They can evaluate tactics, be ready to change course if required, and plan a good pivot strategy to stay ahead.
Changes may take place even within an organization. These changes may be due to organizational development, mergers and acquisitions, management restructuring, or adjustments in organizational goals. These internal variables might necessitate alterations to operational procedures, staff responsibilities, or overall strategy focus.
On top of the abovementioned factors, here are other reasons to create a pivot strategy:
- To respond to technological or other world changes
- To increase revenue through market expansion
- To maintain relevance in the industry
- Address market testing data
- Evolve the business through a business pivot
We’ve discussed these items in depth in another blog.
Tips on Creating Your Pivot Strategy
Change is necessary. And it should be handled carefully and thoughtfully. Businesses need to do an in-depth analysis, assess the potential effects of change, and create workable plans to reduce risks brought on by new directions. You need to balance flexibility and a clear vision to ensure that changes are in line with the overall business objectives.
Here are some tips for planning and executing your pivot strategy. This will help you reduce the risks involved in pivoting and raise your chances of having a successful outcome:
1. Make sure you really need to pivot
Pivoting puts a lot of things at stake. If not done right, it can turn a challenge into a full-blown crisis. And you’ll end up losing more than not doing anything at all. So, it’s important to evaluate the situation carefully.
Is it the right time? Are you equipped with the right people, money, and resources to make a major move? Never bite off more than you can chew.
2. Pivot as soon as possible
Pivoting too late is just as bad as pivoting too soon. Once you’re sure that the situation calls for drastic measures, you need to act fast. To prevent losing time, effort, and money, you must pivot as soon as you have all the plans and resources in order.
3. Keep what’s working
Although some pivot strategies entail foregoing certain parts of your operations, this doesn’t mean scrapping all the work you’ve done. You can shelf some of your original ideas and processes, and revisit them later.
Identify which aspects of your operations can still be useful in the long run. After all, you’ve invested a good amount of time, energy, and money on them. It’s simply a matter of redirecting these existing resources to meet new goals.
4. Listen to your customer feedback
The feedback you receive from customers is an excellent indicator. While occasional negative feedback is expected, if you’re constantly getting repetitive criticisms, use it to your advantage and adjust. The common customer complaints are typically about your prices, problematic features of your product, customer service, or overall user experience. Take these as a baseline to pivot. Improve areas that customers are pointing out.
5. Make sure your pivot presents growth opportunities
If you lead your startup in a new direction without much thought as to where you’re going next, chances are, you’ll hit yet another roadblock. New issues could occur under different circumstances. To prevent this, ensure you research everything regarding your new path expansion. If the market is smaller, the customer base is less diverse, or has too much competition, it’s not worth risking. It’s better to keep looking at other options.
6. Plan your pivot
Pivoting without a plan is like steering a ship with no destination in mind. Once you’ve set your goals, you have to plan out the steps to achieve them. A pivot plan should outline the company’s steps to implement the pivot. It should include timelines, resource allocation, and key performance indicators (KPIs) to measure its success.
7. Monitor and revise
Lastly, once you start executing your plan, keep track of the progress. You have to regularly monitor the pivot’s progress to integrate it into your company’s scaling trajectory. This allows you to evaluate whether the shift is indeed producing the results you’re aiming for.
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We’ll help you put up the necessary management and communication solutions to keep your business functioning smoothly. We specialize in developing reliable teams for lengthy projects. Create a team with Full Scale!