Know What is Pivoting in Business & Why Every Stakeholder Should Know About it
As the time progresses, every business needs to adapt to the changing market conditions. It is considered the symbol of proactivity that allows them to stay alive in the industry. Those businesses that are not well aligned with the changing conditions, always struggle to find a solid existence in the market. This particular strategy to shift mindset is called Pivot in business. It is the most important tool in current times, because it allows companies to transform their services according to the emerging market requirements.
The difference between a successful and non-successful business is the mindset to bring flexibility in services. We have seen many startups and small businesses fail in the mid stages due to not having ‘Plan-B’ in their armory. The pivot in business is therefore such an important concept that allows you to thrive in the market even in the most difficult conditions.
All you need to do is to just realize the areas where you can shift your business in the wake of an unsuccessful first industry venture. If you are from a tech industry, you can take various software outsourcing services to do this transition perfectly. There are certainly a lot of gaps available in the market that can be fulfilled with the timely business transformation.
Being a business stakeholder, you must need to know this concept because hard times can come into anyone’s journey. In this article, we will talk about pivot in business in more detail, so that you can understand how business mindset can be transformed when times are challenging. Let us first understand what is pivoting in business and how important it is to thrive in the tough market conditions.
What is Pivoting in Business?
To become a successful business, you always have to work with a secondary plan. It has become an important requirement of the modern financial world that cannot be ignored under any circumstances. As learned by different lessons in history, there could be times when businesses might be forced to change their core direction and adapt a new strategy to remain alive in the market.
This shift in business strategy is called pivot in business. It is an important concept that should be kept in mind by all the stakeholders, because any company can face tough challenges in different stages of their business journey.
We have seen many examples in the world where businesses have altered their direction to keep their wheels on track. This is not considered a surrender to competition, but a timely change of business strategy to get good returns from the market.
Today, every business must need to learn this concept because the past few years have given everyone some hard lessons. They need to know how they could move to any other domain when the time is not right or their functional requirements are quickly changing. It has certainly saved many businesses from going bankrupt, as well as losing their identity to a premature failure.
Pivot in Business During the Pandemic
We all know very well how last couple of years went badly due to the arrival of pandemic. It sent shocking waves in every industry, forcing many small businesses and startups to shut down their ventures. Those who remained successful in surviving that time, gained a little profit by pivoting their business to a new direction. This has given everyone a lesson how important pivoting is, especially in this era where you can meet different types of challenges any time.
Those businesses that have identified the areas where they can progress in pandemic are now reaping huge rewards from the market. It was undoubtedly a very tough time that gave plenty of lessons to everyone. Many businesses opted to pivot towards online channels to take some advantage of the rising trend.
This precisely worked for them, allowing their businesses to prosper fully even during the pandemic. Many business process outsourcing experts have seen this as a perfect example of pivoting in business strategy. It has helped to save many companies during the pandemic, especially the ones that didn’t had much capital to standby in those challenging conditions.
The Financial Impact of Pivoting
Before starting to pivot a business, you must also need to think about the financial impact. It is a very realistic question that should be answered before diving into any new venture. A lot of startups often fail at pivoting due to not analyzing the risk they are taking during this process. This a common problem seen among many small businesses in the industry. Their lack of knowledge doesn’t describes anything to them regarding the end results. Yes, the strategy to change the direction is encouraging, but if it is not done smartly knowing the risks involved in financing, then it could ultimately falter as well.
The best way to avoid this scenario is by looking deep into the matters that are related to financing. As per the best suggestions, it is recommended to hire a financial advisor who can guide you to take the correct steps in this transition. You can also take help from different financial consultants in this regard, as they also provide detailed insights about plenty of things.
Once you have done the financial analysis, you can take the call for pivoting easily. It will clear up your mind by giving a proper explanation about the risk involved. If you think your business can take that risk effectively, then transition will become effortless for you. So, managing the finances during pivoting is hugely important, especially when you are running a startup or small business with a little capital.
When Should You Start Pivoting?
The signs that lets you know about the need of pivoting doesn’t come in plain sight. The detrimental effects are always hidden, and as a business owner, you must need to find them by looking with an eagle eye. If you will ignore them without giving any attention, then it would only prove to be costly for your business. Therefore, it is recommended to look for the signs that describes the need for pivoting with some clear hints.
If you do not know what those signs are, take a look at the points given below. This will help you to know the correct business state that needs urgent attention.
Failing to Improve Sales
Every company thrives on generating sales from the market. It is the bread and butter of every organization, no matter how big or small it is. If the sales are not good enough, then any company can come to its knees within a matter of time. That is the reason why generating sales is always termed important for every organization. The business owners always pay heavy attention to it because their stakes are directly involved in it. If anything goes out of the line, they react quickly with an anticipation to fix it using all the available means.
So, it is quite obvious that if the sales of any company is continuously decreasing, then something is required to pull it back on track. That is where the need of pivot in business arises, and only intelligent minds can assess it at an early stage. It lets you know that the current business paradigm is not working, and new strategy is required to fix it properly. This is definitely the first sign of a failing business that should never be ignored by the relevant stakeholders.
Limited Market Response
If your business is continuously getting lesser response from the market, it might be hinting for a change in strategy. This is one of the earliest sign of a failing business you must need to look at. Sometimes, people ignore it at the first stage. They think that their company is just started and it will need some time to get established in the market. However, this time becomes lengthy for them without giving any proper leads. And by the time they come to notice it, the damage has already been done.
It is therefore recommended to analyze this factor at the first place to avoid any future failures. It is quite a natural thing that can be noticed easily by the stakeholders. All they need to do is to just look at the general reviews of the market. This will let them know what the people think about them and whether they need to optimize their services or not. It offers a good reality check, so that you can build secondary plans with great proactivity.
High Market Competition
When the market competition is high, it becomes difficult for small businesses and startups to survive in the market. The stronghold of established players often reduces the chances of SMBs to grow in the industry. This is generally seen in all the sectors, which is why startups often struggle to make their name among the big players. However, it also presents a unique opportunity to them to seriously think about their future. It gives them a chance to think about pivot in business if they really want to succeed in the longer term.
Therefore, high competition is also an hint about the need of pivot in business. It can be noticed by those stakeholders that are intelligent in assessing the market condition. They can make quick plans to change the direction and give their business some sort of stability in the market. And those who will try to fight uselessly with the high competition will certainly make their survival difficult in the industry.
Another aspect that can inspire you to bring change in the business is the need of modernization. It is certainly very important to know that only those businesses can succeed in the market that offers new age services. So, if you are struggling a bit to find customers in the market, try to modernize your business perspective. You might need to introduce new services or products that can engage them quickly. This will definitely require a great pivot in business that can change the entire fortune of the company.
Many small businesses and startups have adopted this strategy to gain good leads from the market. They smartly outlined the areas where they can excel, precisely by introducing new set of services and products.
That takes us to the end of this blog in which we have discussed about the concept of pivot in business. It is very important for every stakeholder to fully understand this idea. The modern market is quite volatile and it can change very quickly within just a few time. Understanding the concept of pivoting in business helps you to prepare for all types of challenges. In this article, we have explained about it in detail, so that you can know how to perform pivoting in business when the times are tough.
Meanwhile, if you are looking for an agency that can help you to pivot our outsource projects timely, contact us today. We are quite well versed in the tech sector, and have got years in experience in offering quality services to the range of clients. We can help your business in the transition, precisely by providing a wide array of tech services.