Like a basketball player who keeps one foot planted while spinning on it to explore different directions, companies pivot by staying grounded in what they’ve learned while shifting directions to explore a new customer base or providing different products or services to your existing customer base. The pivot is a term coined by Eric Reis in his book The Lean Startup and it has gotten a lot of buzz in the startup and growth communities of late. Nearly every successful company has pivoted on some level and there are many classic examples. Nintendo started selling playing cards before switching to electronic games. Tote was an online clothing catalog before it pivoted and became Pinterest. So, how do you do it? For starters, make it a topic of discussion in management meetings on a regular basis.
- Discuss your business environment – your supply chain, your competition, feedback from your customers. Are there changes on the horizon that will be disruptive to your industry? They could be opportunities.
- Brainstorm for ideas on how your company could pivot to improve your position in the value chain, to get a leg up on the competition or better serve your customers.
- Decide on a course of action and execute it. Use what you have learned to this point and build on it. Do not be anchored to things that do not work, but don’t “throw the baby out with the bathwater” either. Make sure you allocate sufficient resources in terms of budget and training and marketing to implement the pivot successfully.
Being able to pivot is critical for middle market companies. The good news is, it is easier to do at this stage while everyone is accustomed to constant change. This makes it easier to pivot without leaving a divot!
Have you pivoted in your company? Share your story in the comments below.
Photo courtesy of streetballblog.
The Middle Market CFO 