Pivots: Big and Small
Pivots happen – they can be big or small, planned or opportunistic. Pivots can occur in product offerings, geographical reach, company composition or capital position. Sometimes businesses can plan in advance; at times an opportunity arises that requires a quick decision; and on occasion a challenge forces a change. Clearly the Covid-19 pandemic, with its quick arrival and widespread impact, resulted in change for every company. What have we learned? Not only can we take quick action as needed, but also that regardless of the underlying motivation and resulting change, it is critical to maintain a disciplined process including diligence, decision-making and an ongoing awareness of the overall environment.
“We know that challenge and opportunity can be two sides of a successful business story,” said Jason Kropp, partner, WilmerHale. “Just as entrepreneurial spirit and disciplined operations can combine to build a growing company. We see these attributes across our client companies as they embrace exceptional ideas alongside deep experience.”
“Warp speed” decision making To paraphrase a well-known line – with great challenge comes fast change. The pandemic forced companies to make decisions in a compressed time frame. Decisions that used to take more participants were conducted with fewer layers and/or less reach. Or perhaps all the usual participants were included, but the time-frame was radically altered with fewer meetings and streamlined email flows. Whether to upgrade this product now, or expand marketing spend today, leaders stepped up to make rapid decisions.
Careful diligence, just faster Diligence is the process of paying proper attention to the important factors of the business change. Many companies took advantage of the opportunity to raise additional funds because of a favorable window of opportunity. Some with follow-on equity offerings or additional debt, others took advantage of the IPO market and chose the past year to become publicly traded entities. Whether a brand new decision, or an acceleration of a previously laid path, company leaders maintained a focus on terms and conditions, while moving forward with new capital structures.
Ongoing Awareness It can be tempting to concentrate on external events, or, at times, to direct your attention just to the internal organization. But successful pivots demand an ongoing awareness of the full environment. From new technologies to employee well-being, cultural shifts to conference room usage, successful financial leaders continue to move forward with an awareness of company-specific data alongside larger considerations.
Where the pandemic enforced new challenges, it also opened dramatic new opportunities. From cost structures to business practices, companies are now looking ahead to a more normalized business operations, but with much to be gained by incorporating some of the pandemic-enforced pivots.