Pivoting is when you take your company in a different direction after things aren't going as well as you'd hoped. This can often be used as a buzzword being thrown around that can result in a warm and fuzzy conversation about companies pivoting and magically becoming a multi-billion company like Instagram or Twitter. However, it's definitely a real thing that's more complex than it seems, and sometimes you even have to throw in the towel. Let's take a look at both situations.
I have gone through this winding pivot journey in my own businesses. You don't just wake up one day, realise what you need to change, do it and then become successful. There's a lot more to it, so let's break it down.
The warning signs.
Knowing if and when to change your strategy can be tough, but there are common warning signs that can suggest it might be time to switch it up. These include:
- You're frequently trying to educate or convince people about your product. If what you're selling isn't growing at least a little organically and you have to keep evangelising about it, it's probably not good enough.
- You're in limbo. You're not doing horribly, but you're definitely not doing as well as you planned. You're stuck in the middle, often plateauing or just breaking even (if you're making money at all). This is a dangerous place to be. The most precious thing you're wasting here is time. More on this later.
- Investors aren't interested. If you're taking your idea and trying to raise capital but it just isn't working, or they 'don't really get it'.
- You're trying to be everything to everyone. You don't have a niche audience, people are coming and going but you have no loyal, key customers.
If any of these sound familiar, it might be time for you to do your own pivot. So what does that entail? Hey would you look at that, it's below!
What it takes.
There are a few key things that are required to pull off a pivot:
- Humility, honesty and self-awareness. It takes courage to admit that what you're doing is not working, that your baby is now an ugly one that people don't like and that your idea didn't go the way you wanted it to. This is the first step. Don't let your ego get in the way of admitting you need to change. Take an unbiased, unemotional perspective as if you were consulting for somebody else's business.
- Understanding the reasons that what you're doing isn't working, and the solutions for any of the problems you or your customers are having. There needs to be a reason why you're pivoting as well as logical thought behind the change. Don't just throw darts blindfolded and hope for the best, you'll just waste more resources.
- A clear strategy for your execution, including marketing (any re-branding such as web, social media, press or promotions etc.), operations (development, content, systems, customer management, staffing etc.) and your finances (costs, revenues and budget).
- 'Success' targets. You need clear milestones to know if the change you are making is working, as well as a contingency plan if you don't hit those targets. This may result in another pivot, or simply shutting down.
- Hustle. This is not easy to do, in some cases you're almost completely starting over again.
Pivot or pack up?
I'm not trying to discourage anyone, but there are a few harsh truths worth pointing out when you're considering this path.
- Pivoting costs time and money. Every time you make changes you are using whatever resources you have available. You can pivot more than once, but if you have no cash, you can't afford to do it. Be realistic with your finances and vision. It can be done, but don't lie to yourself. This leads to my next point.
- Sometimes you just have to shut down. Not because you are choosing to quit, but because you simply cannot afford to continue, or it makes no logical sense to keep going (unless your ego is in the way). There's nothing wrong with learning from what you have done and moving on to the next thing. My mentor once told me 'one of the most expensive things in the world is missed opportunity cost'. While your stuck doing this, you can't do something else that may be worthwhile. It's motivating to hear 'DON'T EVER QUIT!' but recognise that sometimes it's not quitting, it's simply a strategic retreat that in some circumstances you have no control over.
- ALWAYS be learning. Whether you succeed or fail does not matter, and it's worth noting that failure teaches the best lessons. Do not be disheartened if your idea didn't turn out the way you wanted, sometimes things just don't work out for reason due to uncontrollable forces.
. . .
Whatever you do in business, it's important to know why. There has to be strategies in place, reasons you're taking certain directions, and an eye for opportunities. Sometimes a pivot can make your company explode, other times it can consume all the remaining cash and resources you had left. Whatever happens, always be learning, always keep your head up and always enjoy the ride! Good luck.