Ready to pivot your business? Start here.
Have you ever tried fixing your car while driving it?
Making changes is a hell of a lot easier when you aren’t in motion.
That’s true with cars and it’s true with your business. While many businesses have been forced to stop or slow down right now, this may represent the best chance to make changes to your business model, whether changes are made out of necessity or opportunity.
Using this time to do what others aren’t doing right now will help position you to get results others won't.
But where do you start?
Pivots I’ve led have been prompted by very different circumstances, not limited to too many sales too quickly, not enough sales at all, dot-com booms, dot-com busts, financial meltdowns, bull markets so long they make us nervous, and more.
Regardless of the business or the situation, I approach pivoting business models the same way I approach building one from scratch: Breaking down the business model into digestible bites with Strategyzer’s Business Model Canvas (BMC).
Alexander Osterwalder and Yves Pigneur introduced the BMC in their book, Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. And if you aren’t familiar with the BMC, it’s a tool designed to help you break down the complexities of a business model into simpler, individual components consisting of:
Value Proposition
Customer Relationships
Channels
Customer Segments
Key Partners
Key Activities
Key Resources
Cost Structure
Revenue Streams
Using the BMC correctly is a great process for any company at virtually any stage. The process challenges many of the ingrained biases and assumptions we all have about our business, or businesses in general, including those we didn’t even realize we had.
This is obviously an important part of evaluating the merits of a startup business concept. But it’s no less an important part of evaluating what is working, what isn’t, and what to do about it in your fully operational and established business right now.
Every business is unique, but when I’m helping businesses use the BMC to develop a pivot strategy, we typically follow the same 8 steps:
Document the business model as is on a BMC.
I certainly have my own structure for this, as will anyone with a lot of BMC experience. Osterwalder and Pigneur’s Business Model Generation is obviously a good place to start with developing your own. If you are looking for something faster, I recommend Isaac Jeffries’s blog post, “How To Fill In A Business Model Canvas,” which is a great resource for how to approach this and a reasonably quick read.Work through a series of structured questions to evaluate the assumptions.
Use answers to audit each section and identify weak spots and constraints.
The goal here is to check your work and begin to identify problem areas. Weak spots may have revealed themselves in the process, which is great. Just be sure you are challenging yourself and your assumptions about your business, which is deeply personal. I’ve shared some of the questions I use to help businesses evaluate the assumptions in a guide, Reset and Rethink. You can download the guide by clicking on the link.Develop viable options that leverage strengths and solve for problems.
I recommend treating this like a brainstorming exercise and getting as many ideas, options, and alternatives on the board, even if some of them feel like dumb ideas initially. Miha Matlievski frames some of these principles in his post, “Four Rules of Brainstorming.”Select three and document them with new BMCs.
Compare options and use criteria to eliminate options.
Pick one and commit to a direction.
Execute.
This is a subject in and of itself, but suffice it to say, what’s good on paper can fall apart in practice with poor execution. Two resources I recommend to improve the execution phase of this - or any other - initiative are FranklinCovey’s 4DX and Gino Wickman’s Entrepreneurial Operating System (EOS).
This approach has worked to lead and help others lead pivots to business models as diverse as:
Large nonprofits and trade associations that need to modernize.
Solopreneur ventures that need to scale.
Sports technology startups that need investor capital to survive.
Private equity backed companies that need to increase enterprise value.
For impact companies that need to stop churning sales people.
Brick and mortar retailers that need to grow without capital investment.
And more.
Your business is unique and will have its own challenges and opportunities. The process, though, has never failed to result in an objective plan that helps leaders define their business’s or organization’s best future.
If you’d like to learn more about how I can help you lead this process, feel free to book time to discuss your unique situation.
