Pivoting – an act of desperation?: with Dale Howarth

BUSINESS MENTOR, SPEAKER AND CPD TRAINER

By Dale Howarth

PIVOTING – AN ACT OF DESPERATION?

Photo by Jim Wilson

At this time, the pressing need for change is leaving many business owners feeling paralysed, or in a state of flux, as they work out what to do that is right for their business. With all the current disruption to commerce the term ‘pivot’ has become a buzzword, to suggest fundamental changes to a business’s strategy and direction of travel, in order to survive. However, pivoting should not be seen as an act of desperation. The sheer number of businesses that have accelerated their success by pivoting indicates that there is much more to it than a last-ditch strategy. Whilst 10% of business failures cite ‘a pivot gone bad’ contributing to their demise, 7% attribute ‘a failure to pivot’ as a critical mistake that led to failure of the business. This highlights the importance of balanced consideration to the strategy and the degree that a business pivots. It is widely accepted that businesses should only pivot when absolutely necessary, and that it must be done with considerable planning and thoughtful execution - pivoting may be the answer for some, but in reality it was never developed in the context of what we face today. Traditionally ‘pivoting’ was intended to help a business adapt and recover after experiencing new competition or other known factors such as their products moving to end of life, markets becoming saturated or a business hitting a plateau and needing a change of direction. There are some great examples of businesses that have pivoted to survive. Twitter originally started as Odeo, a platform to serve as a social channel around podcasts, but when Apple launched iTunes podcasting in June 2005 they could see the writing on the wall, they pivoted and in March 2006 Twitter was launched.

Yes, many have pivoted and seen massive success as a result, but it is not the magic cure for everyone. It’s something that should not be done to comply with the latest buzzword, but only after all other options have been fully considered. A ‘pivot’ can irreversibly change a business, which may not sit well with staff and backers. The financial cost and investment can be high. You may also give up hard-won reputation and some may see the move as a reflection of failure. For some, rather than the dramatic U-turn associated with a pivot, it may be better to consider adapting by degrees, to more slowly change direction by addressing one pressing problem at a time. In some ways it’s a simpler, more gradual and less drastic form of pivoting. Quicker, less radical, more flexible and with the current lack of stability, this can be a more prudent option. Examples include turning a popular feature of a product or service into a product in its own right, or moving part of your focus to re-position your business into a new vertical market.

Undertaking a Pivot U-turn, or adapting by degrees, can provide the reboot that some businesses need to meet mounting challenges. For many it is a logical option, the next step, but one that needs careful consideration to achieve what is right for any business - to make the situation better, not worse.

Dale Howarth is a Business Mentor, CPD Speaker and Accredited CPD Training Provider. Working with individuals and companies to make the business leaders and businesses successes of tomorrow. To find out more visit www.dalehowarth.com.