In business, it can be referred to as a pivot. This is your ability to adapt to market changes, demand, and even how the public perceives your product or services.
American Express began as a mail service. In 1993, IBM posted an $8 billion loss — in one quarter. Netflix used to rent DVDs. None of these companies failed, because they adapted to change. IBM, for example, stopped selling hardware and focused on software. And you know how Netflix and American Express pivoted.
Because you know the success that followed, it is easy to view these pivots as positive. But entrepreneurs make these decisions daily. We wanted to show how change can be positive — and what to look for before pivoting your business.
Truly believing in change
People usually build a business based on passion. It may be rooted in a product, a service, or a drive to be successful or financially independent. Your business can become a very personal thing — you might not see the product, you see the time spent sacrificing and working.
To change your business's direction may feel like you're negating your efforts. That perspective will only inhibit you. Look at your previous work as the scaffolding that brought you to where you are now.
Does your idea have a shelf life?
Current success and stability come with no guarantees. Blockbuster and Nokia are two companies whose products didn't survive external changes. People streamed movies and bought smartphones.
When you adapt to change, consider how your product or service can be altered, not scrapped. In the 1990s, when Apple was nearing bankruptcy, they didn't abandon their computers — they created an iPod to meet the demand of people who preferred their music streamed.
Foster the right culture
When environmental, economic, or political factors force you to pivot, what will your employees say? A rigid, unbending business plan might create employees who are worried about change. Foster a culture that encourages new ideas and encourages mistakes — because there is no such thing as wrong. There's success, and learning from missteps.
If the time comes to take your company in a new direction, it will be viewed as an extension of your innovation. By embracing change and encouraging your leaders to do the same, you can improve the present and the future.
At Maxwell Dunn, we're proud to be trusted advisors for entrepreneurs and business owners. The demands of running a business don't have to be faced alone — we go beyond legal services as a full business advisory firm. Contact us to schedule your consultation.
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