Many organizations find themselves needing to pivot strategically at some point. Maybe your business's growth has stagnated, or maybe you're seeing a surge in demand. If you suspect your company needs a change, here are five steps to help you analyze your current business model and determine where to modify it.
1. Track Opportunity Costs
What could your business be doing if it weren't on its current path?
You want your company to reach new milestones, so it's important to answer this question. Your business may focus on one action, or sell one product, but it could theoretically do something else. Closely track the actions your business is performing that are lucrative and make sense for the organization. Compare your areas of focus with other potential market opportunities to see where you might be missing out; these are your opportunity costs. Does your business need a change to bring a new opportunity within its grasp?
2. Document Weaknesses
Are you spending the most time on your worst projects?
Successful businesses focus on their strengths and avoid initiatives that do not fall in line with competencies. Chart where you're spending your time and what proportion of your workload these initiatives represent. Restructure and optimize your time accordingly.
3. Examine Shifts in Your Market
Does your company have the best possible market fit?
If your products or services don't quite align with your market, it may be time for a change. Companies large and small are under immense pressure to provide top services because digital media makes it easy for consumers to find competitors. You need to be the best at what you do and have a well-defined value proposition, or a reason consumers should choose you.
The best way to get started is to talk to your customers and prospects. Conduct 30-minute qualitative interview calls to learn their wants, needs and concerns. These tangible insights will help you determine whether to pivot your business model.
4. Take a Few Steps Ahead
What does the future hold for your business?
Small business owners who want their business to be around in 10, 25 or 50 years should ask this question every day. You know your market best, so take the time now to reflect on the changes you foresee. Determine whether your company is prepared to compete for the long haul and prepare to take steps to evolve with your market.
5. Ask Your Employees
Are your employees sticking around?
Employee retention is a sign of a bright future. Analyze your business from your employees' perspective to see what's working and what needs to change. Consider talking to individual employees to learn more; they're in the thick of it and well-positioned to provide useful feedback.
Change can be a good thing, especially when it happens to your business model. Be thoughtful in examining your business's past, present and future, and you may just find new opportunities to grow your business.
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