Every business will undergo a series of changes as it grows and develops and (hopefully) becomes a success. But there are a series of questions that every entrepreneur should consider before pivoting their business in a completely new direction…
1. Why are you pivoting?
Before even considering a change of direction for your business, you need to be able to articulate the exact reason for that decision. Micah Rosenbloom, a venture partner at Founder Collective, says: “Understand the motivation for the pivot. Do you feel like you have a viable product, but you misjudged the go-to-market plan? Did you underestimate the complexity of the product you seek to build? These may be perfectly good reasons to pivot.
“Be honest with your advisers, trusted investors and senior team. Reassess your options. There is no shame in starting a company that fails to change the world, but a badly handled pivot can cause more damage than hitting the stop button.”
2. What are you customers saying?
Your customers are the ones that you’re really working for. At the end of the day, they’re the ones who will be paying your bills so it’s important that you take time to question what they’re saying about your product or service.
“A single customer may not always be right, but when all of your customers are mentioning the same feature as something they really like, you can bet that that feature is a keeper,” says Daniel Russell, founder & CEO, Attentiv. “Similarly, when all of your customers are mentioning the same roadblock or annoyance, you can bet that that aspect of your product is something that needs to be reworked.”
3. What can you offer?
Having worked out what your customers are saying – and hopefully what they want from your product. Think next about what you can offer that is different from your competitors.
“One of the tried-and-true methods of building a business is by offering such useful products and terrific service that you disrupt the local market, winning customers away from your competitors,” Richard Branson says. “We at Virgin have done this with a particular focus on disruptive change."
“From our first ventures, like our music stores and record label, to some of our flagship businesses today, including our airlines and space tourism companies, we have approached business development proactively and opportunistically, looking for openings where we can surprise and delight customers by offering something truly different.”
4. What is the plan?
It’s all well and good announcing that you’re going to pivot your business to a new direction. But you’ll need to communicate an exact plan with your team. Take the time to answer this question on your own or with your leadership team before you even think about communicating the pivot to your wider employees.
“What are the exact steps that need to be taken to pivot? What resources inside and outside the company are needed to succeed? Who is responsible for which steps of the process? What needs to happen before the pivot even starts?” Barry Moltz, author of How to Get Unstuck: 25 Ways to Get Your Business Growing Again, says. “The answers to these questions need to be outlined in a shared document of no more than a few pages.”
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