There may come a time when you are forced to completely change something about your business, practically overnight, in response to an extreme situation - either good or bad. This is often referred to as a "business pivot".

Why pivot? Here are a few reasons:

• You need to recover from negative publicity following a recall or crisis, and regain customer trust.
• A competitor is taking over your niche market and you need to change direction or risk a significant drop in sales.
• One of your products has really taken off, so you decide to focus your efforts on that item in order to capitalize on its popularity.
• You discover a special process or skill set that can be leveraged to make your business immediately more productive.

Let's say you run a small home-based business, where you make and sell organic bath products. One of your items quickly becomes popular with customers, and word spreads. The next thing you know, you are receiving more orders than you can fill. This leads you to concentrate on making just that one item and to hire additional help.  Then you expand your space so you have more room for production and inventory storage. Within weeks, your business is operating very differently from when you started. Taking advantage of your situation has led to your pivot.

How do you prepare for a business pivot?

• Be ready for change - Having a few key strategies in place will help you address unexpected issues while keeping your day-to-day operations running.
• Gather information - If you've made a mistake, figure out why it happened, and what you can do to address it. When things are going extremely well, listen to what is being said about your business. If a sudden boost in popularity appears to be only a temporary trend, you may not need to make permanent changes to your business. 
• Keep the lines of communication open - You will need the support of your customers and employees, particularly if the changes directly affect them.

After the pivot

Monitor the situation. You may need to change things more than once.  Being patient and persistent is admirable, but if things are not working, you need to know when to cut your losses.

There is a learning curve for all new businesses, and many of them make several changes in the early days. Part of operating any successful business is knowing how to prepare for and respond to unexpected events and keep moving forward.

Prepare yourself by learning more about unexpected change and risk management.

 

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