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What is Pivoting, and Steps for Entrepreneurs for How to Pivot in Business

Books & Resources, Inspiration, Leadership

Sooner or later, an entrepreneur will find themselves wondering – do I need to pivot? After all, few businesses never need to change strategic direction. Frequently, changes in technology and consumer behaviour require adjusting how we do business. In fact, it can be argued that companies who fail to pivot end up, well – failures. Blockbuster is a famous example. By sticking to DVDs and ignoring the rise of digital streaming, they went out of business in 2014. To understand what is pivoting, and steps for entrepreneurs for how to pivot in business.

What is pivoting

Essentially, a pivot is a significant change that impacts the way a business is conducted. A pivot is strategic, not tactical. For example, changing the colour of employee uniforms or redesigning business cards is not a pivot. However, if those changes were part of adding a product line to target a new customer base, then it is a pivot.

Examples of a pivot in business

There are many ways to pivot in business. It could be a subtle shift in pricing strategy to attract a different market segment. Or it could be a major transformation, like eliminating product lines to focus on something entirely new. Here are some examples of a pivot in business:

Implementing new technology

Technology should be upgraded regularly. But sometimes, a bigger shift is required. Like switching from a paper based system to digital processes. This can be a big learning curve for customers and staff who are used to the old way of doing things.

Adding products or services

This is a pivot because it impacts operations, staffing, and marketing. For example, a hair salon decides to offer tanning. A cake shop adds a gift bag package to make party planning a one-stop shop. Or, a landscaping company expands its services to include eavestrough cleaning. Sometimes, these pivots can be achieved with a sub-contracting relationship or collaboration with a local company.

Eliminating products or services

Sometimes a pivot is letting go of something. Like discontinuing a product or service. There may be many reasons for this. If demand declined, it’s easier to just stop offering it. However, it could be supply chain issues or rising material costs which makes that line unprofitable. Then, the pivot would be replacing it with an alternative source of revenue.

Changing existing processes

Pivoting can be changing existing processes in any area of the business. This could be connected to using new technology, like switching to a chatbot instead of using live support agents. Also, it could involve shifting away from automation to a more personalised customer experience. Like, sending out a sales rep to meet a potential customer instead of offering an online quote.

Shifting target market

Another pivot is when a business decides to focus on a different sector of the market. Perhaps this is to differentiate, because there are just so many competitors going for the same target audience. So with a new pricing strategy aligned with updated marketing messaging, an entrepreneur may focus on a different niche. Though the market may be smaller in that segment, often the higher profit margins means it’s better for business.

How to pivot: Steps for Entrepreneurs

Ok, so now that you understand what is pivoting, you may be wondering how to implement in your company. These 10 steps for entrepreneurs will walk you through how to pivot in business.

1. Acknowledgement

First, recognize that it’s time for a change in direction. This starts with acknowledging that something isn’t working in the business. Maybe revenue has flatlined, or profits are shrinking. Or staff turnover is rising, and customer retention is dropping.

2. Acceptance

This step is all about mindset. It is important to accept that the business is going to change. This can be a challenge for entrepreneurs, because a pivot may move them away from their initial vision for their business. Resistance to change is a huge barrier to a successful pivot. So take a moment to lean in and fully accept that things are going to be different.

3. Agreement

Every business has its own structure and culture, so this step looks different for everyone. Essentially, it’s about making sure that key stakeholders are on the same page. Key decision makers should be in agreement about making a pivot in the business. Otherwise, it makes implementation very difficult. This step is about leadership and communication.

4. Brainstorm

Next, it’s brainstorming. Ideally, all stakeholders will be involved in this step. And also, it’s good practice to get some outside perspective. A mentor or a business coach will offer fresh insight and ideas. Step outside the day to day of the business and turn off the phones. Be creative and open to fresh ideas. This step is about getting a list of ideas for how to pivot the business. Also, be clear about the issues the company is facing, and the business goals.

5. Evaluate

Now that there is a list of ideas, it’s time to evaluate. Research market conditions and do competitive analysis. Do a risk assessment of each pivot idea. As much as possible, identify costs, barriers, and problems. All of this data is a guide for entrepreneurs for decision making and implementation.

6. Decide

After considering all the information gathered in Step 5, it’s time to make a decision. As with Step 3, key stakeholders should be involved in the decision making process.

7. Commit

Next, commit. Meaning, fully embrace the decision, and be ready to see it through. There are many failed pivots because entrepreneurs went into it half-hearted. For example, new software was purchased but not all the functions are being used. Or a new product is added without a new marketing strategy to promote it. So commit to the decision and have a positive mindset about a successful pivot.

8. Plan

Now that a decision has been made, it’s time to plan to roll out the pivot. Project planning is a skill, and this is a step which may benefit from some outside help. It is important to have a workflow, a checklist, and a timeline of each step and action to roll out the change in the business. After all, a failure to plan is a plan to fail!

9. Implement

Finally, it’s time to implement the pivot. Depending on the scale and scope of the project plan, one person should be responsible for managing this. Because change is difficult. And implementation involves many steps and moving parts. Communication is so important, so that suppliers, staff, and customers understand what is happening at every stage.

10. Measure

Lastly, measure the results and outcomes of the change in direction in the business. Was the pivot successful? This depends on how success is defined, which links back to Step 1. For example, if the issue was no revenue growth, and revenue increased in the months following the changes implemented, then the pivot was a success.

Conclusion

This summarises what is pivoting, and steps for entrepreneurs for how to pivot in business. Following these 10 steps will guide any business owner on how to identify, choose, plan, and implement a strategic change of direction. A pivot is not a decision to make quickly. Taking the time to analyse, research, and plan will increase the success of a pivot to reach business goals.

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What is CX

Books & Resources, Customer Experience

Buzzwords and acronyms come and go in business. So if you’ve seen CX and not known what it means, you are not alone. CX means Customer Experience, and it’s not a trend. It’s a foundation of good business, because it impacts customer purchase decisions. Also, strong CX creates referrals and repeat business. Additionally, it builds revenue because studies show that customers are willing to pay more when they have a positive customer experience. Clearly, it’s important for entrepreneurs to understand what is CX and how to use it strategically.

Understanding CX

First, to explain what is CX. CX describes the overall perception and feelings a customer has when, well – being a customer. From the first interaction to completing a purchase, the customer journey includes many steps and stages. Understandably, this is different for every business. Because for a retail store, an attractive entrance and welcome greeting is the first impression. Meanwhile, for an e-commerce business, the ease of finding product information matters first. Therefore, it’s important that every business considers the journey their own customers experience.

Customer Journey Mapping

And what is customer journey mapping? It’s a visual of the stages, touchpoints, and emotions a customer experiences. It’s looking at your business from the viewpoint of your customer. From awareness to the decision process, then receiving the product or service, and on to the post-sales relationship. The goal is that every customer has a positive experience and is not only a loyal, repeat buyer, but an advocate. Meaning, that they give your business positive reviews online and refers you to family and friends.

CX for the Entrepreneur

Due to the importance of CX on purchase decisions and customer retention, it’s become a separate function for most large corporations. After all, it’s been measured that improving CX by 1 point can mean millions of dollars in revenue for many industries. So a CX department with trained professionals is a worthwhile investment. (Note: I completed the Professional Certificate in Customer Experience course at The CX Academy)

However, the reality is that most small businesses don’t have the resources to hire a dedicated CX professional. Like with many aspects of entrepreneurship, CX is a DIY activity. Rather than getting into a complicated framework of explaining and measuring CX, I’m going to explain the foundations of what is CX for small businesses. Quite simply, understanding customer experience are these 4 elements:

1. Deliver Promises

Be sure that the reality of what your customer experiences matches what is being presented with your brand messaging. If your company is putting itself out there as being professional and informed, then staff shouldn’t be in a torn uniform, or poorly trained. If a 30 minute sales call is booked for Monday at noon, show up and complete it in 30 minutes.

2. Clearly Communicate

Information gaps and errors loses consumer trust – fast. And people talk more about a bad experience than a good one. So clearly communicate – in emails, on the website, and in any customer facing documents. Don’t be vague, as in “respond soon”. Instead, say “respond before the end of the next business day.”

3. Be Consistent

Document processes and monitor KPIs so that standards of service are maintained at all times. Because every customer should have a quality experience, every time, Someone shouldn’t have great service on a Monday and terrible service on Friday.

4. Reduce Effort

Finally, a pillar of good CX is to reduce effort for your customers. Quite simply, make it easy for them to do business with you. This covers alot of ground. For example, automating processes to update their payment information or contact details. Or providing online options to reschedule appointments at their convenience. It may mean reducing the number of clicks required to place an order on your website. Implementing a 1-click checkout transformed Amazon into the ecommerce giant it is today. Essentially, view everything from the perspective of your customer, and brainstorm ways to make interactions easier and faster.

Examples of Good CX

Surprisingly, good CX is often because of what doesn’t happen. As in, there is no frustration, no wrong information, or no long wait. Alternatively, good CX is created from small acts of communication and appreciation that add up to just feeling good about buying from that business. Here are a few examples of good CX:

Clear Communication

A service call is booked for Tuesday at 2pm. An email on Monday morning reminds the customer, and provides a link to reschedule if they require it.
Emailed updates or tracking links so customers can monitor the processing of deliveries and returns.

Appreciation

Tucking a branded notecard with a handwritten thank you when packaging orders.
After renewing a snow removal service for another year, the customer receives an email thanking them for their loyalty. It includes a discount code for a local home decor store. This is a powerful collab! For more examples on how to use collaborations to grow your business, read this article..

Recognition

A customer calling to talk about their lawn cutting service doesn’t have to give their full name and address, because their customer profile pops up on screen by keying in the phone number they are calling from.
Arriving at a salon and being greeted by name, before offering your usual order of black coffee.

Examples of Bad CX

Unfortunately, there are many examples of bad CX. Primarily because companies have not done the work required for understanding customer experience. Remember, CX is as much about perception and emotion than fact. It may only be 5 minutes on hold, but if the customer was expecting to wait 1 minute, this will be a negative experience. Examples include:

Online

After reading the FAQ of a website and needing more help, you click on “Contact Us” which just leads back to a Help Section and the same FAQ page.
An item listed on sale for $19.99 gets added to the cart for $24.99.

In person

Changing rooms are locked and no staff person is around to unlock them.
Items are not tagged with the correct price. Or are missing tags and signage.

Communication Gaps

Sending in an enquiry or question and being informed that a representative will respond shortly. What is shortly? 1 hour? 1 day? Lack of clarity is bad CX.
The sales rep explains the service will take 3 hours and the technician will arrive at 9am. Then the technician arrives at noon and says the work requires 6 hours.

CX and your business

As shown above, CX can positively or negatively impact revenue. Strong CX contributes to customer retention, repeat business, and referrals. However, just one bad CX experience can cost you a customer forever, negative reviews, and word of mouth. Now that you have a solid understanding of what is CX and why it matters to your business, here are some ways to start making improvements. Look at your business from your client’s perspective, and consider:

How easy is it to find contact details?
How long is the wait to connect with a person?
Do customers ask questions that are not covered in the FAQ?
Are there gaps between what is being promised and what actually happens?
Are delays or changes clearly communicated?
What communication do our customers get AFTER to thank them for their business?

Overall, make CX important when making decisions about customer communication, ordering, payment processing, and delivery.

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What is a CRM and why every service business needs one

Books & Resources, Customer Experience, Leadership

If you are an entrepreneur running a service business without a CRM, you are missing out. Truly. A CRM is a Customer Relationship Management software. They can be fairly simple or very sophisticated. In all cases, it’s a powerful tool to manage customer communication and relationships. Read on to understand what is a CRM and why every service business needs one.

CRM explained

Essentially, CRM software is a database. It’s a hub to centralise all available information about customers. Though this includes basics like contact details, it also captures purchase history, preferences, and past communication.

Features of a CRM

Next, let’s look at the key features of a CRM. Understanding its functionality will make it clear the value of using it in a service business.

1. Analytics and Reporting

Because smart business decisions are based on data, tracking KPIs (Key Performance Indicators) is very important. However, without software, this can be tedious and time consuming. Therefore, the reporting capabilities of a CRM is a valuable feature. Furthermore, these can be customised to fit each individual business. And this makes it easy to run reports on measurements that matter to your business.

2. Automating Communication

Since many CRMs have email marketing features, this allows for client communication to be automated. For example, setting up a happy birthday message to send on the right date means less administrative work. Also, this feature can be used to build loyalty and boost sales. See the next session for specific examples to implement in your business. Even if a CRM doesn’t have its own email marketing function, it can connect to MailChimp, FloDesk, or Klaviyo using Zapier.

3. Scheduling and Reminders

Use the scheduling feature of a CRM, and never forget a followup call again. This can be short term, like a post-service call for next Tuesday. Also, it can be long term, like setting a call for when a customer returns from vacation in a few months. Either way, it means centralising customer activity into one software. This is streamlining, which saves time and improves focus. Overall, it is smarter to use a CRM than crowd a calendar with tasks or search through a jumble of notes.

4. Customising and Centralising Data

CRMs offer many ways of tagging and categorising customers. Also, they usually allow for custom labels, so you can personalise for your business. By uploading files, photos, and documents, all information about a customer can be centralised. This cuts down on paper filing, as well as flipping through online folders and email boxes. Keeping all customer data in one place cuts down on administration time, and powers opportunities to build loyalty and drive sales. More importantly, it empowers all staff to have access to the same information.

5 Ways to use a CRM in a service business

Next, here are some real examples of how to use a CRM in a service business. Remember that when selling services to customers, the relationship they have with your company is critical for success. After all, when there are many options for landscaping, or dog walking, or house painting – then it’s their feelings and experience as your customer that determines whether they will buy from your business again. So here are 5 ideas you can use today:

1. Build Customer Relationships

For a service business, consumer relationships have a huge impact on the bottom line. Acquiring a new customer can be costly, so building a base of loyal, repeat customers provides stable revenue. When a business is starting out, it’s easy to keep track of customer details in a notepad online, or on paper. But as the client list grows, it’s impossible to remember it all. So use a CRM to record everything your customers care about. Did someone mention it’s their son’s birthday next week? Add that to their file in your CRM! Because a year from now, when you casually pass along Happy Birthday greetings in an email, their mind will be blown. This is a powerful way to build customer relationships.

2. Build Customer Trust

Consumer trust is another factor that matters in a service business. Trust can be lost so quickly, which is why the data management function of a CRM has so much value. Every opportunity to demonstrate attention to detail builds consumer trust in your business.

Here is an example. In my last business, a customer once called in very upset because she’d been expecting services that day – but no one had shown up. She wasn’t even on the schedule! It looked like a screw up on our side, which would have hurt the relationship.

However, a quick scan of her file in the CRM showed that a month earlier, she had emailed in to cancel service for that day. Which she forgot about. After a gentle reminder of this, the situation immediately turned. Instead of being angry, she became apologetic. Using the CRM to record customer communication transformed the situation and prevented loss of trust.

3. Encourage Repeat Business

Use a CRM to leverage whatever seasonal cycles happen in your business, and craft a communication to encourage repeat business. If spring is a peak time for your window washing business, then use your CRM to filter everyone who booked that service last spring – and send them a message inviting them to book again. Reminder emails like this can be set up to go out at appropriate intervals. Alternatively, it can be automated to be sent a certain number of weeks or months after their last purchase.

4. Close More Leads

No business closes 100% of leads. Whatever the closing rate is, a CRM can be used strategically to increase it. Just connect the CRM with email follow ups to automate and streamline the sales process.

Personalise the messages using the data you have about the lead. For example, the email can be set up with fields for first names, address, service description, and the price quoted. When the potential customer receives that followup, they have all the information they need to make a decision and take action, without having to dig through their own records.

5. Upsell

For businesses offering multiple service lines, use the filtering capabilities of a CRM to upsell customers. For example, a landscaping business can send its lawn cutting customers emails inviting them to book leaf blowing. Or a hair salon sends information about colour treatments to customers who have never booked it. Knowing customers and what services they have used is an opportunity to promote the other services you offer, in a meaningful way.

CRM and Service Businesses

In summary, a CRM is a powerful tool to manage customer information. It centralises data, which streamlines processes and cuts down on administrative time. More importantly, it enables personalised communication which builds customer relationships and loyalty. And finally, it provides a way to generate reports that drive analysis and smart business decisions. For these reasons, every entrepreneur with a service business will benefit from having a CRM.

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Books & Resources