Recap: Adaptability as a competitive advantage
In our previous article, we discussed how the events of 2020 led many businesses to develop a new and essential skill, organizational flexibility. For most, the development of this competency brought significant growing pains with it (ourselves included). But the development of policies and processes to identify, measure, and respond to environmental changes is a critical, long-term survival skill for all businesses.
In the wake of the pandemic, adjustments may have included new accommodations for working remotely, new delivery mechanisms for products or services, or entirely new products and services, as consumer needs shifted, and new commercial opportunities surpassed legacy offerings.
Following Lewin's Change Model, by now, many of us have 'refrozen' or 'set' our newly developed practices in place following a difficult adjustment period. While this was undoubtedly the most abrupt and universal disruption in memory, each of our businesses is continuously faced with its own unique and changing conditions. Consequently, those who can capture and expand on the lessons of this difficult adjustment and retain some element of fluidity will find themselves in possession of a powerful new competitive advantage: Adaptability.
Introduction to the strategic Pivot
Armed with our newfound capability to develop as an organization, your next step is to recognize where to go and what to change. This inflection of strategic direction is commonly referred to as a Pivot. A Pivot is not a change in your fundamental business but rather an adjustment to your strategy while leaving your core business intact.
What happens beneath the surface is highly dependent on specific firm resources and opportunities. For example, no matter the strategic direction, successfully leveraging your core comparative strengths will determine your ability to establish or retain a competitive advantage in your new endeavour. Failure to keep these core success factors in mind can result in failed experiments, wherein you are caught between the past and the future, with vital resources not allocated shrewdly to the service of your future-state.
BDO has taken the time to distill a roadmap for the successful execution of strategic pivots, the BDO Pivot Playbook for the mid-sized enterprise. The Playbook follows five critical steps that are universally applicable for strategic pivots. Together, these provide an essential playbook for executive stakeholders looking to lean-up their operations portfolio, diversify market dependency, and ultimately increase their return on invested capital.
BDO's Pivot Playbook
Determining if a Pivot is appropriate