- Charles Darwin -
As small business owners and entrepreneurs, we are faced with many decisions, some minor, some crucial and once in a while, we are faced with the big question, the big decision, the one which will define a new path toward our company’s vision. The answer to that question will usually result in a significant change to our venture but how can we know the right answer?
All major businesses face this decision. YouTube was intended to be an online dating service site called Tune In Hook Up, which allowed users to upload videos of themselves, the founders made the decision that the idea is too narrow and dropped it. Nintendo used to sell playing cards. Richard Branson’s Virgin was a student magazine company for a few years before he closed it, and Marriot hotels started by selling root beer.
There are also many companies that did not realize they need to make the crucial change in order to survive, and wound up disappearing. I am sure you still remember Pets.com, Atari, Borders and Circuit City stores. They had a decision to make, they could have adapted to the new reality, they could have changed, but they did not.
Charlie, Athena and I have been talking a lot about the history of change, Athena liked the concept of “pivoting” as explained by Eric Ries in his great book The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses, it seems that pivoting or making a change from the original vision of the business is becoming the norm and not the exception.
It is a very important concept to embrace for any business owner, to me the hardest part, is not the change itself but it is the realization when things do not work, when your original business vision implementation does not work.
I asked Charlie the other day “How does one know when a change or a correction is needed?”
Charlie told me “the key is to learn and measure what works and what does not. Without measuring, you cannot identify when a change is required”
He looked a bit sad as he continued “Identifying key performance indicators and measuring is one of the steps that were skipped by many out-of-business ventures, it does not need to be an elaborate process, and it should involve defining simple criteria to measure the validity of your idea”.
I thought for a minute and then asked “How do I know what to measure?”.
Charlie said “It is a great question Liz, it varies between different businesses, each business may have its own yardsticks, it may be the amount of paid/free subscribers to your service, the length of engagement with your service, the percentage of your product’s returns, and of course various financial measures such as sales, profits, and cash flow”.
My mind is full with measuring thoughts. I know I need to measure my services and products to make sure I am on the right path toward achieving my vision. I also know that it is ok to adapt, admit that something is wrong; and make a steep correction in my business.
Being adaptable in business and our lives is not a luxury; it is a must in order to survive.
Have you made any major change in your business lately? Drop me a note, I would love to hear how you realized a change is needed and what you have done!
Liz (who needs to make a big decision about her business)