The onslaught of Coronavirus (COVID-19) has sent businesses scrambling to find their footing in this new environment. These days, many small businesses are struggling simply to stay in operation, let alone hope to achieve a profitable quarter or see revenues jump as a result of special offers or discounts. It’s a time when once widely accepted business models are coming into question.
It is likely many businesses will attempt to pivot operations within the next few months. Seeing customer demand for some goods and services dwindle, nimbler business leaders will opt for re-examining what worked before, what isn’t working any longer, and where the business might turn next to maintain growth (or even survive to fight at a later time).
Here are tips for preparing to pivot, should this approach make sense for your small business:
Hold onto functions and operations that still work.
“Pivot” generally doesn’t mean scrapping all of your business functions and operations. Look at facets of your business that can be kept in place, or maybe tweaked a little to achieve greater efficiency. Pivoting doesn’t mean starting from scratch.
Improve communications with key constituencies.
If there’s ever a time to over-communicate, doing so while attempting to pivot is a necessity. Consider two key stakeholders:
- Chances are your workforce is now working remotely. Thanks to advances in digital technology, there’s no reason to lose touch with them at any point during the ongoing pandemic. Collaborative and video software makes it possible to stick to a regular schedule of online meetings, stay updated on current projects and initiatives, and simply to keep employees informed of plans to pivot during a critical time.
- Employ the same technology to stay connected with customers and prospects. (You might also call your most trusted customers and invite them to offer feedback on your plans to pivot the business.) Face-to-face meetings aren’t practical at this time but maintaining the strength of your existing relationships is critically important. These are the people and businesses you want returning to you when the crisis has passed.
For further high-quality communications, leverage your company’s social media presence to “let your audience know what is shifting within your company, what new services you are providing, how this will improve your clients’ shopping experience and how this can benefit them!” says Patrick Barnhill of Specialist ID, Inc.
Identify areas where cost-cutting makes sense.
No one likes sharply reducing operational expenses and salaries, but looking closely at these actions is part of any strategic pivoting effort. Experts suggest making sure you have “at least three months of additional runway,” Forbes notes, adding that key actions include “office space elimination, hiring freezes, salary reductions, furlough, controlled marketing spend, working capital initiatives and renegotiating major contract expenses.” Again, it won’t be easy, but building up your business’s cash reserves makes pivoting more economically viable in the long run.
Make a plan.
Pivoting a business should never be undertaken on a whim. The process requires careful analysis of red flags that prompted thoughts of a pivot in the first place. Red flags, in addition to the global pandemic, can include a wave of customer complaints and negative online feedback, an influx of new or more aggressive competitors, price undercutting by business rivals, and too much attention given to one product line over other possible sources of revenue generation.
With this analysis in place, start to assemble a plan that ensures you have all the right elements in place, including:
- A comprehensive grasp of the economic implications
- The need to retain key top performers and/or recruit new staff
- A viable schedule for undertaking and completing the pivot
Business and uncertainty never make for a good mix, but like it or not, uncertainty is where we are at this time. Comprehensive planning and preparation will make the effort to pivot more amenable to all involved and increase the likelihood that the effort will work.
To enhance your communications strategy during this time of crisis, sign up for our complimentary TAB BOSS Webinar, “6 Tips for Crisis Communications During the Era of Coronavirus.”