The Art of the Pivot
by Morgan Hays
The COVID-19 pandemic has created many new, painful and challenging situations for the business community and the product management discipline particularly. Product managers, as the hub of the business, are particularly impacted by the increased and sudden uncertainty that the pandemic has brought to the market.
In situations of uncertainty, mastering ‘the art of the pivot’ can be particularly beneficial as it may turn a change in the customer needs into a new revenue opportunity. How do you determine whether a pivot is necessary, how to execute on it and finally how do you measure success and determine next steps?
What is a Pivot?
A ‘pivot’ occurs when either the product’s primary use case changes or the way that the company fundamentally delivers on that use case changes. For example, Netflix executed a ‘pivot’ when they moved to streaming in the early teens. In this instance, they continued to meet their customers’ primary use case, but fundamentally shifted from an operations-centric business to a software and networking business.
When to Pivot?
The primary factor in deciding to ‘pivot’ is a deep understanding of your customer’s needs. Have external forces, such as the COVID-19 pandemic, changed your customer’s jobs to be done set? In my experience, major changes do not always change a customer’s needs. For example, during the 2008 financial crisis, I was working on a new consumer-focused search platform for a large technology company. Despite the significant impact and uncertainty that the crisis caused, it became clear through rigorous customer research that the crisis did not change consumers’ fundamental needs to find the right content at the right time.
An example of a major change creating the need for a pivot is the introduction of the iPad. When the iPad launched, it became the first mobile device that could credibly replace a TV in a consumer’s home. At the time of the launch, all of the cable operators in the United States delivered video programming through a proprietary stack of hardware and software. Again, through careful customer research and observation it became clear that customer needs HAD changed. Consumers now desired flexibility and mobility in the way that they consumed video content in the home. This change drove a fundamental shift in the delivery of video programming. Cable operators added an application-layer-only delivery model that complemented the original proprietary model.
How do you Pivot?
In the event that your understanding of your customer’s needs suggests a pivot is required, the next step is determining your pivot (internal) promotion storyline, based on data and incremental changes. The key element here is ‘incremental’. By taking this conservative approach, you will develop credibility with your internal peers and show an appreciation for the value of the current product and business. This last element is particularly important. During times of great uncertainty, such as today’s COVID-19 pandemic, there is typically a sense of protectiveness about the current product due to the significant time and energy that you and your peers have put into the existing product. Hence, after drawing your conclusions from the data you collected, think about the pivot holistically.
To guide your thinking, answer the following questions:
What is the potential user experience?
How will this product generate cash?
How will it be sold?
What is the sales cycle?
What are the marketing investments and how will the product be positioned?
How does this product relate to the current business?
The key to generating consensus internally for your ‘pivot’ is to craft your answers to these questions into a narrative around a lighthouse customer. By centering on an early and credible lighthouse customer and walking through the entire product experience for that customer your peers will have a tangible means of seeing your answers impact a real customer and therefore the business.
Measuring Success and Next Steps
Measuring the success of the pivot, similar to determining whether a pivot is necessary, is a function of customer feedback. This feedback should take both quantitative and qualitative forms. First, what are the sales and customer success teams saying about the customers’ product feedback? Second, what are customers actually doing with the product? What is their adoption curve and which jobs is the product satisfying for them? By combining qualitative and quantitative feedback into a narrative you will reinforce the importance of the customer’s voice to your sales and customer success peers and showcase your ability to transform usage data into actionable insights.
The content of this blog contribution is based on the BPMA event “The Art of the Pivot: Knowing When to Change Your Product and How To Do It” that was held on June 25, 2020. More information about this event can be found here.
About the Author
Morgan is a product executive with deep experience creating software platforms and applications in the media industry. His 20 years of experience as both a startup founder and executive at public companies has given him a wide array of experiences and a strong sense of pragmatism and appreciation for the value of a powerful story. You can reach Morgan at morgan.hays@gmail.com