In my last blog I wrote about the need to remain relevant. This week I want to talk about how smart businesses use the market to evolve their business model or do what is commonly referred to as a “pivot”.
Most successful businesses will have multiple pivots before they find the right product/market fit. In fact, almost all of the successful entrepreneurs that I have worked with have ended up with a business model that is significantly different (and better) to the idea they started with.
As the highly successful entrepreneur Steve Blank says, “A start-up is a temporary organisation in search of a scalable, repeatable, profitable business model” and the businesses that succeed are those that build that search capacity into their business planning process.
Think about the business you are in now and compare it the original vision you had for your business. Ask yourself what’s changed and why has it changed? What was the catalyst for the change?
For most business owners it will be money (i.e. the need to make more), competition or “lucking” into a previously unforeseen market opportunity.
To successfully pivot you need to have an open mindset and use a discovery-driven planning process.
Here are my tips to help you successfully pivot and build “luck” into your business:
1. Don’t let passion get in the way of change
Passion is good and is needed to provide the drive and enthusiasm to build a successful business. But blind passion is dangerous. It can make you overprotective of your business idea and blind to oblivious flaws in your business model. To successfully pivot you need to be open to change.
2. Listen and communicate with your customers
Rather than just find out what’s working and you’re doing right, ask what their real needs and problems are. Having an open discussion with them can identify new opportunities you hadn’t previously thought of and uncover where new demand will come from. Engage in a regular feedback loop to research and refine what paying customer needs are and how you can monetise solutions to them.
3. Look externally
In addition to your existing customers, constantly check what potential customer needs and expectations are and whether they are being met. If not, great, another opportunity. If so, how well are your competitors meeting those needs and is there an opportunity to match them better? You might uncover a niche opportunity that’s highly profitable with less competition.
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