What is the one buzzword we’re hearing all around us in the business world these days?
A pivot is a strategy I have used—and you can use—to take your business from where it is to a new plane of existence.
A pivot is usually necessitated when there’s a crisis, or revenue was not what you’d hoped it would be, or something crazy is going on in the world. If you’ve been in business for awhile—or you’re looking to grow your business—and you want to make sure your business can survive any turns in a constantly changing marketplace, then you heard about pivoting long before our current global situation.
Pivot pivot pivot. Everyone’s talking about it, but what does it mean? What does it look like? How do I actually do it? Is there a strategy for it? Can it possibly be understood in a systematic way?
When you keep hearing the word, but no one is telling you what Step One is, or where and how to begin, it can be really frustrating.
A pivot means a change. It presupposes that you’re willing to change your business in some fundamental way. You’re not necessarily changing the focus or the outcome—you still have the same vision, but now you’re going to take different tactics.
You cannot solve a problem with the same level of thinking in which the problem was created. More importantly, the solution to a lot of our problems lies outside of ourselves. In times like these, you need to go out looking for those solutions.
I found some experts with some solutions recently in Harvard Business Review. Thomas Ritter and Carsten Lund Pedersen have produced a methodology called “Alignment Squared: Driving Competitiveness and Growth Through Business Model Excellence.”
They produced a workbook entitled: The Impact of the Coronavirus on Your Business Model, and they’re offering it for free. I highly recommend gathering a group of friends or co-workers or fellow entrepreneurs and working through the ideas and concepts in the workbook together.
In their material, Ritter and Pedersen share five specific areas they focus on when it comes to figuring out your pivot. They are:
These five categories comprise your business model, your business strategy. They help you ask and answer questions like: Why am I running my business? Is my reason still valid? Who is my customer? What am I selling to that customer? How am I offering value? How do I get my product in front of the customer? What is my go-to market strategy? What abilities do I need to carry out my business?
When you’re beginning to analyze your pivot, you have to first know where you’re starting from. You explore each of those five categories and answer those questions (and more).
Then the next step is relatively straightforward. You reevaluate all five of those in three different stages:
During the crisis.
Immediately after the crisis
The new normal.
As you evaluate those five categories through each phase and ask very specific questions, you’ll be able to unearth opportunities and/or weaknesses in your business. Opportunities you haven’t discovered and weaknesses you’ve overlooked.
Let me share a personal example from the short term rental world. Before Coronavirus (BC), our customers were business travelers, families with small children, and medical travelers.
Now, let’s look at our customers during the crisis. Back in March, we saw a significant amount of cancellations/refunds. It was chaotic. Business travelers and families with small children stopped traveling. We lost a lot of money.
If we hadn’t been able to pivot, we’d have been in big trouble. But the thing that quickly became apparent is that people still need a place to stay. They’re just different people now.
We started hearing stories about emergency responders (police, firemen) who were exposed to the virus and didn’t want to go back home. They needed a place to stay short-term. We heard about medical professionals who needed a place to stay. As colleges and universities began to shut down, students in dorms didn’t have a place to live. Opportunity after opportunity.
Where did we get this information about these new customers who needed a place to stay? Here’s where I’m going to give you an unconventional tip. When you’re looking for leads, ideas, problems to solve, one of the easiest places to find them is the news. The news is very good at reporting the problems in great detail. They tell you what happened, who did it, how long it’s been going on. They don’t present a solution, but they tell you what’s broken—multiple times a day.
Leveraging the news as your lead generation source is a hack to finding your new customer in many cases. It was for us. Analyzing your customers in this new situation, and watching the news with your eyes and ears open, will bring new opportunities that didn’t exist before.
So, now we know what our customer looks like during the crisis, but how do we know how that will change after the crisis and in our new normal?
We don’t. But that doesn’t mean we don’t start trying to figure it out.
As I look through this transition we’re going through, I think it’s going to be awhile before a number of individuals are willing to get on an airplane and travel and congregate in something as simple as a hotel lobby. I think, for a while, people who provide short term housing will have an advantage because we’re smaller, because there will be less people around. We can cater to more specific needs. This will create a unique window.
I’ve just shown you how we pivoted in just one of the five categories. You’ll run that same scenario with all five. Like I suggested earlier, gather a group of fellow entrepreneurs (most likely on a Zoom call), and go through that workbook together. Bounce ideas off each other. Get creative. Try to imagine a new normal in your field.
As human beings we have three responses to a crisis: fight, flight, and freeze. Freeze isn’t going to work with something like this. Flight isn’t an option, because where are you gonna go?
You have to fight.
Putting your business in position to have a fighting chance is what it’s going to take for you and me and everyone to make sure we can continue to survive and thrive.
Fortunately, we have great resources available to us to forge a new path through this wonderful wilderness we all find ourselves in right now.
Interested in pivoting into the short term rental world? Join me inside my free Facebook group where you can learn all about the process of starting and growing your short term rental business.