"Should my business pivot?"
Many businesses ask me many questions but one of the questions that has become more common over the last few months is whether their business should pivot. Regular readers will know that many of the answers to questions I overhear are often prefaced with ‘well it depends’ but this question can in many ways be easier to answer than that.
Any business should constantly adapt to changing circumstances and opportunities, and do what it needs to do to not only survive but to grow and prosper. This is normally by way of evolution but when needs demand it, it should also be by revolution. Needless to say that the coronavirus pandemic of 2020 has been a time where adapting slowly has not been enough, and revolution has often made the difference between survival and closure. These times really are about survival of the fittest.
A recent survey by Be the Business, an industry-led productivity leadership group, from discussions with its network of 250,000 people and a survey of 500 small firms, suggested that 21% had pivoted their business in a meaningful way. We can all think of many such companies selling products that they did not before lockdown, or providing services in a different way. Some obvious examples are eat in restaurants that have started offering a home delivery service, or local bakeries selling home baking kits.
Some statistics suggest that as many as 40% of companies that have pivoted in a fundamental way have actually increased sales from pre lockdown levels. For the remaining 60% of ‘pivoters’ it has at the very least produced sufficient income to ensure their survival. These numbers show how important this tactic has been for many thousands of companies.
It is probably true to say that for the majority of the early stage businesses that are in the 40% that have increased sales, that they will focus their new ‘post lockdown’ business model on the new business even if they do also re-introduce the original activities. For some, that will mean a total pivot into a new area and one where they may never have ventured without being forced to think creatively. For those in the remaining 60% many will retain some aspects of the new revenue streams and so even they will have pivoted somewhat.
However, in order to gain the biggest advantage from pivoting it is of course important to do this as soon as feasible. This will ensure the biggest gains as soon as possible, or, alternatively, the stemming of any losses in the quickest time.
In a world where many large businesses have pivoted from manufacturing cars to making ventilators, or from producing perfume or chemicals to providing hand sanitiser, every business owner and every business must play to its strengths. One of the very real strengths that smaller businesses have over larger businesses is their ability to adapt and implement changes more quickly than larger, more established rivals. The lockdown period, more than ever before, has been the time for early stage businesses to play to that strength.
Whilst it may be harsh to say, quite a number of businesses that have failed could probably have survived by pivoting rather than just trying to do exactly the same thing as they were before lockdown, or to preserve cash. So just as every business should always be looking to adapt by evolution, they should also be ready to pivot by revolution in need, or indeed simply if an opportunity presents itself.
So the answer to the question of should my business pivot, then the answer is yes absolutely, if and when necessary. The answer to the question of should your business adapt, then the answer is yes, always, and constantly.