Big businesses are always in the process of change, be it a subtle shift or a massive pivot. Follow the success of major brands and look for these four signs that indicate it's time to change direction.
Google, Facebook, PayPal, Microsoft, Boeing: Each of these major brands have adjusted their business direction over time. Likewise, there are major brands that have crumbled as they failed to adjust course, such as Kodak, Sears, Pan Am, MySpace, Yahoo, BlackBerry and legendary gaming developer Atari. Adapting to change and altering the path of your business is key not only for survival but also for profitability and personal achievement.
Erratic movement in brand direction, or shifts in focus at inopportune times, can be just as disastrous as passivity. Stability following shake-ups comes from making the right choices at the right times. This begs the question: What signs should you look for that tell you it is time to make a directional change?
1. Sales have plateaued.
Markets are finite, which means they have limitations. Many businesses, especially those operating on a local or domestic scale, find they hit a plateau in terms of sales volume. Figures might be strong (or they might not be), but, eventually, there is a potential to cap your market. Running a brick-and-mortar business in a small town, for example, means even if you are the most popular brand around, your customer base can hit a peak that is impossible to climb beyond.
If your sales plateau, you need a directional shift in order to continue growing. Brick-and-mortar stores can look to online sales, local services can seek to offer to a greater range, and those selling nationwide can expand to international sales. Improving on sales stagnation is about looking to the next step and changing your direction to an upward movement.
Unless you operate a global enterprise like Microsoft or Google, you've really only just started to scratch the surface of potential consumer markets.
It is easier for some businesses (versus others) to access new markets. Take, for example, a local accountancy firm. How does a brand that operates within a particular area, with local offices, adapt to a sales plateau? It's all about thinking creatively. The accountancy firm could take advantage of modern technology and go remote, offering online consultancy and cloud-based financial management.
There are always options available for reaching new markets. It's just about finding the direction that works for your business.
2. Your expertise has outgrown your market.
You may find your level of expertise in your chosen industry progresses over time. As your degree of insight advances, it is likely you'll develop a capacity to offer services beyond what your current client base is looking for. Development does not mean you cannot still offer the services you originally intended, but failing to do so can be a major missed opportunity, causing you to miss out on greater options for expansion and profit growth.
Amazon is perhaps the largest and most recognizable retail brand on the planet, yet its origins are founded in the sale of books. From humble beginnings, the commercial giant quickly found success in online sales and used the expertise it acquired selling books to expand into the juggernaut it is today. Had it continued to focus on its original market, Amazon may well be the biggest book retailer in the world, but it wouldn't be anywhere near the goliath that it is today.
Take what you learn and use it to advance your brand. Allow yourself to outgrow the market you set out to conquer.
3. Your market has shifted.
Markets can be in a constant state of flux. Recent rises and falls of the casual dining experience, for example, have seen many major brands expand rapidly before experiencing serious financial struggles. To see changes in your consumers is not an uncommon scenario, though. It is something many businesses need to prepare for as demands change.
If you experience a market shift, battening down the hatches and hoping to weather the storm is not the optimum path to future success. It is more likely to lead to closures and collapse.
Adaptivity is core to business survival. Take Netflix as a prime example. The business started as a mail-order DVD rental service to rival the titan of movies, Blockbuster. Now, Netflix is the leading online streaming service, worth billions of dollars, having adapted to the changing market landscape of people looking for quicker results. Blockbuster, on the other hand, failed to adapt to the shifting market and collapsed.
If your market shifts direction, move with it.
4. Your ambition is greater than your current potential.
The evolution of your business isn't always about practicalities and strategic choices. Sometimes, ambition is the driver of change.
Often, people start a business because they have a goal or a dream they are hoping to achieve. It may be notoriety, expertise, personal accomplishment, or it may simply be for financial gain. There is no wrong answer, but there can be a wrong sector. It's tough to know when you start your business where it will take you. After years of operating, though, you'll find your rhythm and be able to assess what the future might hold. At this point, you may find the potential of your business has limits that fall short of your ambition.
If your dreams will not be satisfied by your current course, you needn't let them slip through your fingers. Let your ambition feed your choices and work to achieve what you set out to accomplish. If your goal was to revolutionize the tech industry, but your current platform isn't going to allow that, it's time to change direction. Apple is a prime example of this. After years producing meager offerings, it shifted direction to focus on design and user interface and never looked back.
Adapt and survive
There is an old Chinese proverb that states, "As the water shapes itself to the vessel that contains it, so a wise man adapts himself to circumstances." Business owners should heed this advice and heed it well. As some of the biggest names in the corporate world attest, survival – or at least growth – can often be about adapting and shifting direction. Allow your business to evolve, and you should outlast or outdo those who refuse to break from familiarity and routine.