Maybe, maybe not.
Is it time to consider a pivot? Absolutely.
COVID-19 has created seismic shifts in economic conditions, consumer demand, and sentiment. Some changes might be only short-term, while other effects could be longer-lasting.
Much is uncertain, but one thing is clear. Waiting for circumstances to “return to the new normal” is a squandered opportunity.
Now is the perfect time to consider a strategic pivot for two reasons:
- An opportunity to explore. What better time to explore possibilities when so much of what we know to be true is open for discussion, and everyone is searching for a path forward!
- Sense of control. Just the process of exploring what options might be available helps you regain some power and focus on what you can control.
Pivot is a term most used with startups, but what I mean by a pivot is, “a significant shift to your business model without a change in your mission or purpose.” This would include changes to the target customer, channel, product/service offering, value proposition, revenue streams, and cost structure.
So is it time to pivot? The grass does look greener on the other side of a pandemic. But pivoting is complex, and the grass isn’t always greener.
Still, it’s smart to take a fresh look at your industry, your strategy, and your business model. At best, you might identify the need to pivot while everyone else is waiting for things to “return to normal.” At worst, the simple process of exploration can lead to ideas and opportunities that strengthen your existing strategy.
There are many factors you’ll weigh in evaluating a pivot, but below are three factors I’d like to highlight for your consideration.
Get Closer to Target Customers
First and foremost, use this opportunity to get even closer to your target customer. It’s tempting to think the answer to all of our revenue or profitability problems is to find more customers. New customers are great, but the cost of new customer acquisition is rarely understood. We vastly underestimate the cost, time, and complexity of acquiring new customers during normal market conditions, much less during or post-pandemic.
Connect with your target customer to understand how the current market conditions are affecting them and how they are responding. How do they see the future landscape, and how will they be planning? What are their new objectives and goals? Uncover:
What is causing your customer pain as it relates to the jobs they are trying to do or the goals they are trying to achieve?
What outcomes or benefits are your customers expecting as it relates to the jobs they are doing or the goals they are trying to achieve?
The objective is to get aligned with your target customers’ new expectations and needs to understand how you can best serve them now and in the future.
Are You Still Creating Meaningful Value
Once you understand your target customers’ new needs, expectations, and challenges, you can evaluate the strength of your value proposition. Evaluate how well your value proposition is a:
How exactly does your product/service alleviate these specific customer pains? Focus on the essential pains and not the nice to have.
How exactly does your product/service create functional utility, social gains, positive emotions, or cost savings?
Make these assessments internally, but then find out from your target customers how well your value proposition addresses their new pains/gains.
Your customers’ evaluation is the only one that matters.
Discover Possibilities by Challenging Assumptions
Challenging assumptions and deeply-held beliefs about your business or industry will unearth innovative ideas. It’s why disruption so often comes from outside the industry. This pandemic has shattered our norms and is forcing us to be more open-minded and innovative.
So let’s challenge some assumptions! Here a few questions you can ask in challenging your strategic assumptions. (Be sure to download my Ultimate Guide to Challenging Assumptions below.)
What are the generic business “tests” that a new concept, product, or business idea must pass to move forward in the organization? What are the assumptions underlying those requirements?
What are our limiting beliefs? What are the things we believe are not possible? What do we believe we cannot or are unwilling to do?
Create a stakeholder list. Who are the stakeholders in the business, and what are the assumptions we make about their behaviors and needs?
Look at the latest SWOT analysis. What are the assumptions behind what you consider to be internal strengths and weaknesses and external threats and opportunities?
TIP: Ask these questions with a team of diverse middle managers. Often the executive team can become too vested in the strategic assumptions. Middle management might be more open to the challenge, and they bring the added perspective that comes from being closer to the customer and market realities.
You can download my Ultimate Guide to Challenging Assumptions below.
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A pivot isn’t something to take lightly. It’s disruptive, painful, and you never want it to be the result of a panicked overreaction. If you read the predictions and forecasts of how COVID-19 will affect our lives and our businesses, it’s natural to get panicked. It’s easy to think everything will change forever.
But we have historical examples (Spanish Flu of 1918, 1968 Flu, and HIV/AIDS) that we can use to inform our future. Certain things changed forever, but in the end, humans stayed human. Our memories are rather short.
That said, we shouldn’t wait for a pandemic or other life-altering occurrence to take a hard look at our strategy and ask ourselves, “is it time to pivot?”
The answer is usually “no,” but as a result of the evaluation process, we emerge stronger.
Stay safe and be well.