Council Post: Tips For Measuring The Success Of Your Company’s Pivot

Founder & CEO of KUOG Corporation which specializes in Logistics for the DoD and private sector for MRO, PPE and material support.

Businesses often consider other revenue streams or pivoting into other industries to solidify their brands. As a result of the pandemic, many businesses did just that: adapted, pivoted or added other lines of revenue to survive.

If your business has undergone a pivot in the past year, you might be wondering how you can tell if the pivot was a success or if it will continue to be a success in 2021. How long should you measure key performance indicators before deciding if the pivot is worth making permanent or if reverting to pre-pandemic operations is necessary?

Answering this question isn’t always easy, so to help, I suggest keeping the following best practices in mind:

1. Set a realistic timeline before you measure the pivot’s success.

Making a pivot during the pandemic means that your business is crossing over into a new domain or an additional revenue stream in hopes of gaining market share — all while navigating what some call the “worst economic downturn of our lifetimes.”

Because of this, it would be wise of your team to consider adding an additional nine to 12 months to when you will measure the success of your pivot, and build 2021 into your plan. This will help ensure you have time to make up for any missed opportunities from the past year and those who had a head start on you.

2. Research and test quickly.

Research and test as quickly as possible for what is — or isn’t— driving traffic to your company’s new line, product or service, then adapt as needed based on what you find. 

To get started on this research and testing, look at your current customers. Clients can offer a wealth of knowledge, so conduct a survey and ask them about the new line or pivot. While customers can offer insightful feedback, they might also have experience in the domain to which you’re pivoting (a domain you are likely new to), which is why this research is critical.

If your firm originally serviced the automobile industry, for example, and you found your top-buying customers are first responders, your firm might have chosen to pivot its services to the emergency vehicles space. Your company could then survey your first responder customer base to learn what that group sees as pros and cons of working with your company, and you can, in turn, determine whether pivoting was and is still the right choice.

Making Your Pivot A Success

Before getting caught up in KPIs, ensure you have also taken a look at what you offer. Then, see if any improvements should be made to the pivot to increase the odds of finding success in the first place. One area I’ve found companies often miss when pivoting markets or products is providing value adds to customers or partners.

In other words, approach new partners and customers with an added benefit your competitors are not providing. For example, if you are a manufacturer whose manufacturing capabilities offer clean rooms for highly specialized projects, an experienced staff, and technology solutions and equipment — and you pivoted during the pandemic to create personal protective equipment — you can highlight your original offerings to your new customers as a value-add. Showcase the proficiency in your operations that made a name for your business in the first place. Make sure customers know why your expertise brings value.

Making a pivot or adding a new revenue stream might seem risky, but doing so with a calculated end goal can help hedge the risk. If you have a business plan, revisit it by looking at what worked to make your business successful pre-pandemic and what changes have come about since Covid-19’s spread that prompted the execution of a pivot or new revenue stream. Business plans that were developed with realistic goals and metrics can be valuable when looking back and working to create a new path.

Change is certain, and adapting to it helps businesses survive. Whether you have made a pivot, added a new revenue stream or maintained “business as usual,” 2020 has proven that you must adapt to the environment or be subject to a loss of revenue or even closures. As 2021 begins, you might find that your pivot was one of the more successful moves your business could have made. After all, hindsight is 2020.

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