Change is inevitable in today’s fast-paced business world. What worked for your company yesterday may no longer work today. Whether owing to altering market trends, technological breakthroughs, or a pandemic, there may come a point when you need to change up your business strategy to be relevant and successful. In this article, we'll explore what to do when your current business model no longer works.
(1) Recognise the Problem
The first step in pivoting your business model is recognising that your current model no longer works. This can be a difficult and uncomfortable realisation, especially if your current model has been successful in the past. However, ignoring the problem or hoping that things will go back to the way they were is not a viable solution. Instead, it's important to accept that change is necessary and start looking for new opportunities.
(2) Evaluate Your Current Business Model
Once you've recognised that there is a problem, the next step is to evaluate your current business model. Ask yourself what's working and what's not. Are you generating enough revenue? Are you struggling to keep up with your competitors? Are you facing any new challenges or obstacles? The answers to these questions will help you identify the strengths and weaknesses of your current business model.
How can you evaluate your business model?
- Assess Your Business Activity Model
In order to evaluate your business model, it's important to evaluate your business activity model. A business activity model describes the activities and processes that are required to operate your business. This may include activities such as production, marketing, sales, and customer service. By evaluating your business activity model, you can identify areas where you may be able to improve efficiency or reduce costs.
- Business Process Analysis for Evaluation
One way to evaluate your business activity model is to conduct a business process analysis. This involves breaking down each process in your business activity model into individual steps and analysing each step to identify opportunities for improvement. For example, you may find that certain steps in your production process are inefficient, or that your marketing strategy is not effectively reaching your target audience.
- Data Analytics For Evaluation
Another way to evaluate your business activity model is to use data analytics. By collecting and analysing data on your business activities, you can identify patterns and trends that may be impacting your business model. For example, you may find that certain products or services are more profitable than others, or that certain marketing channels are more effective at generating leads.
- Making Post-Assessment Adjustments
Once you've evaluated your business activity model, you can make adjustments to improve efficiency or reduce costs. This may involve streamlining your production process, outsourcing certain activities, or automating certain tasks. By improving your business activity model, you can make your overall business model more effective and profitable.
(3) Explore New Models
With a clear understanding of your current business model, it's time to explore new business models. This may involve conducting market research, analysing your competitors, or seeking the advice of industry experts. Some potential new business models to consider include:
- Diversifying your products or services
- Shifting your target audience
- Changing your pricing strategy
- Moving to a subscription-based model
- Developing a new distribution strategy
- Partnering with other companies
(4) Implementing Your New Plan
Once you've identified a new business model, it's time to start implementing it. This may involve making significant changes to your operations, marketing, sales, or customer service. It's important to communicate these changes clearly to your employees, customers, and stakeholders, and to provide support and training as needed.
(5) Monitor and Adjust
Implementing a new business model is not a one-time event. It requires ongoing monitoring and adjustment to ensure its success. This may involve collecting feedback from customers, analysing sales data, or making adjustments to your operations. It's important to stay flexible and open to new ideas as you continue to adapt to changing market conditions.
Remember, business models are not set in stone, and things that worked before may actually be setting you back now. By staying flexible and open to change, you can continue to grow your business, remain relevant, and stay ahead of the curve. Mishoura can link you with the best business solicitors that will help you recognise when it’s time to pivot your business model. A corporate legal team will ensure that your business is restructured in the most strategic way, without any legal shortcomings. From legal documentation and contracts to dealing with day-to-day legal challenges, Mishoura can connect you with corporate lawyers that suit all your business needs.
Written By Omar Shams