As reported on Entrepreneur:
Even in the best of times, business leaders know that they will have to adapt their companies. That’s just the natural response to changing markets. The COVID-19 pandemic, however, has presented a new, particularly cutthroat kind of pivot-or-die test. Executives and entrepreneurs who want their businesses to survive and thrive in the future can benefit from looking at some key examples of how other companies are adapting well through the virus crisis.
3 conditions for a successful pivot
As Mauro Guillén outlines in an article for Harvard Business Review, three conditions are necessary for a business to pivot successfully. The pivot must:
Align the firm with at least one trend that the pandemic created or intensified (e.g., remote work),
Laterally extend the company’s existing capabilities in a way that cements its original strategic intent, and
Offer a sustainable path to profitability that preserves/enhances brand value in the minds of consumers.
Competitively achieving these points requires business leaders to be exceptionally aware of current short-term conditions and resources. But it also requires considering broader opportunities that can have a long-term influence on the brand’s perception and operation.
Leading examples of companies making shifts work
Upon reviewing companies that are aligning with COVID 19 trends, one good example is Red Roof Hotels. The company is now offering day rates for workers, allowing individuals to have a quiet, private space to work in which might be more comfortable and flexible and provide a needed change of scenery. Prior to the pandemic, companies were already exploring rented and coworking office spaces to provide these benefits and reduce overhead, and gig workers were finding creative ways to create temporary offices.
Electronics and appliance retailer Best Buy also stands out. With more people working online for school and business, the company increased its focus on virtual support and technology repair. TOV, a furniture designer and manufacturer, acknowledged the growth of e-commerce and focused much of their business online.
Capitalizing on existing capabilities means that your business doesn’t have to spend too much time or money to reorganize, prepare, and execute. Grocery stores like Kroger and Whole Foods, for example, are creating “dark” locations, turning shops into fulfillment centers. This allows the stores to stay within their original supply chains, offerings, and customer base while getting products to consumers faster. T3 Expo, a trade show and corporate events company, similarly took their existing skills and tools for planning to transform a convention facility into a COVID-19 hospital. The company relied on its original foundation but applied it for a completely different type of need.
Lastly, looking at sustainable paths to profitability, Walgreens began to offer delivery on grocery and personal care products, which are always in demand. This will help shift the brand’s image beyond medical and pharmacy needs. Importantly, to make this viable, Walgreens accepted a new partnership with Postmates. The more targeted partnerships you can consider and make reality, the higher the number of options you have for new services and goods. Like diversifying an investment portfolio, these different partnership avenues can ensure greater overall financial stability for the business.
One strategy can address multiple points
There is admittedly some overlap between the above points. For example, T3 Expo’s work with the COVID-19 hospital still leaned on employees’ existing ability to organize, analyze, and network. But it also proved to new potential customers that their talents were applicable in settings other than traditional corporate events, which allows the company to establish new accounts and income streams. The best pivot strategies, in fact, are those that can fulfill all three requirements at once.
Learning from tough shifts now can make future pivots easier
COVID-19 will not be with us forever. But because it forces leaders to pivot like they never have before, it’s advantageous and encouraging to see existing companies making necessary shifts and learning from their strategies, becoming flexible enough to keep their doors open even in these challenging times. In that case, we can follow their lead, make it through current challenges, and have a much easier experience adapting in more normal future times.
Author: Priya Merchant
Date: 2021 01 12
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