PIVOTING YOUR BUSINESS IN A NEW DIRECTION

Sooner or later, all businesses, even the most successful, run out of room to grow. Faced with this unpleasant reality, they are compelled to reinvent themselves periodically. The ability to pull off this difficult feat—to jump from the maturity stage of one business to the growth stage of the next—is what separates high performers from those whose time at the top is all too brief.
  

Entrepreneurs are known for their tenacity and their fearless spirit, but sometimes they need to change the direction of their business and chart a new path especially when they reach a point where they realize that their original product or solution is no longer going to be a best fit, or the niche market they were targeting is too narrow, or they discover that their business plan is not working and needs a major overhaul. But instead of surrendering and failing, these businesses do something great: they reinvent or pivot to a new position, pursue a new market, or adjust their product to better deliver what customers really want to buy.

The potential consequences are dire for any organization that fails to reinvent itself in time. Once a company runs up against a major stall in its growth, it has less than a 10% chance of ever fully recovering. Those odds are certainly daunting, and they do much to explain why two-thirds of stalled companies are later acquired, taken private, or forced into bankruptcy.

There’s no shortage of explanations for this stalling—from failure to stick with the core or sticking with it for too long to problems with execution, misreading of consumer tastes, etc. What those theories have in common is the notion that stalling results from a failure to fix what is clearly broken in a company.

Many of the best-known companies in the world have gone through a few important pivots during their histories…

•         Nokia was founded in 1865 as a Finnish paper mill and later went on to manufacture rubber goods. In 1992, Nokia made its first mobile phone and pivoted to focus on the mobile phone market.

• ·       Twitter started out as a podcast discovery service named Odeo, but the founders didn’t think they could compete with iTunes in the podcasting niche, so instead they pivoted and turned Twitter into the social media platform that it is today.

• ·      Instagram started out as “Burbn,” a gaming and photo app. The founders decided to get rid of the gaming features to focus on the photo capabilities instead — and in 2012 Facebook bought Instagram for $1 billion.

Pivoting can be scary, because it’s often hard to know which market, which product, service, or solution, or which audience is really “right” for what you sell. But pivoting doesn’t have to be a sign of weakness — it’s often a sign of strength and confidence. Pivoting is a way of saying that you’re not afraid to venture off in search of bigger opportunities.

Companies can make a successful pivot if they’re willing to look for opportunities and adapt to the changing realities of their business.