Identifying potential solutions and business pivots

Speaker: Kelly

Welcome back to the adapting to change workshop

[Visual: Opening workshop slide introducing the topic of testing assumptions and adapting to change.]

Welcome back to the adapting to change workshop. By now you have completed your business model canvas and it's time to move on to testing your assumptions of where you believe your core business value lies.

At this stage you've identified what you believe your customers value, what you think your strengths are, and where you think opportunities exist. You can see a lot of views through there. So it's time to test if that is also true out there in the market.

Test your assumptions

[Visual: Slide titled "Test your assumptions". On-screen text states:

• What YOU believe customers value
• What YOU think your strengths are
• Where YOU think opportunities exist
• The next step is to test those assumptions with real people.
• Strong pivots are built on real insights, not purely assumptions.]

Remember that what you are trying to test is where your core business value lies. Be open to your assumptions being incorrect. This isn't always a bad thing as this is often where opportunities are.

A great example of this is Netflix. They believed their core value was convenient DVD rentals by mail. They set out to have better logistics than Blockbuster, who was the competition that they were going after.

However, through customer behavior and market trends, they started to spot that customers wanted instant access to movies. This also coincided with the time that internet speeds were increasing, and they predicted that physical media would decline.

Where they were wrong, and probably pretty happy about it, is that they thought their core value was DVD delivery. It wasn't. It was easy on-demand entertainment access. And in 2007 they pivoted, or moved, to streaming and, well, the rest is history.

How to gather quality insights

[Visual: Slide titled "How to gather quality insights". On-screen text lists sources of insights:

• Existing customers
• Potential customers
• Staff/frontline team members
• Suppliers or partners.]

So what are some of the ways we can test your assumptions?

Well, we focus on gathering quality insights. Now good insights can come from a range of places. These can be existing customers, so understanding what they love about your product or service, potential customers, employees, partners and stakeholders. From their perspective, what makes your business valuable?

[Visual: Slide updates to include methods for gathering insights:

• Surveys and questionnaires
• Social listening
• Customer support data
• Observation.]

Now, in terms of gathering these insights, there are many different methods we can use.

For example, surveys and questionnaires. Can you send out surveys via newsletters or emails or Facebook groups? Remember, with this one, try to really think about what's in it for them. If you're asking a customer to give you information or feedback, what can you give them in return? Could that be a discount voucher? Or could that be something like information via different articles?

There's also social listening. What we mean by this is monitoring social media forums. Reddit, for example, Facebook. There's a lot out there. What are people saying out there in the market? What are people complaining about?

Look at customer support data. So, this could be support tickets, feedback forms, live chat logs, and my personal favorite, observation.

Observing customers in real time to watch how they use a product. We see this a lot in the tech space. You build an amazing product. How does that actually relate to being out there in the field?

Some of the best pivots I've seen are from companies who are really out there listening to their customer and developing products to meet their needs.

[Visual: Reflection slide asking: "Who do you plan to gather your insights from? What methods will you use?"]

Time to have a think about your business. Who do you plan to gather insights from? And what methods could you use?

Take a moment to write down what comes to top of mind now.

Tips for gathering quality insights

[Visual: Slide titled "Tips for gathering quality insights". On-screen text: Focus on listening, not pitching. Avoid: "Would you buy this product?" Instead ask: "Can you tell me about the last time you experienced this problem?"]

Here's some tips for gathering quality insights.

We really want to focus on listening, not pitching. We're not asking, "Would you buy this product?" Instead, we're asking open-ended questions. Things like, "Can you tell me about the last time you experienced this problem?"

[Visual: Slide updates with additional guidance:

• Look for patterns
• One opinion isn't enough
• Repeated frustrations
• Repeated compliments
• Common workarounds
• Changes in behaviour
• Goal is to understand behaviour, not seek validation.]

What you want to do is look for patterns. So, one opinion isn't enough. Don't make the same mistake I've previously made and talk to your friends and family. They're always going to give you a biased opinion that your product is great.

What you want to do is get out there in the market to your core customers. Pay attention to repeated frustrations, repeated compliments, common workarounds, or changes in behavior.

Where is the repetition here? And what can you learn from that?

Remember that your goal is to understand behavior. We're not trying to seek validation or sell our product idea.

A great example of this is the company Slack. You may know Slack as the team communication tool now, but they started as a gaming company. They built an internal messaging tool for their teams to effectively communicate as they were building out the game.

Slack originally thought their core value was the game. They realized it was actually the team communication tool.

And when they were trying to figure this out, they might have asked their teams questions like, "What part of the games do players most enjoy? Where are we losing engagement? Where are players dropping off, for example?"

But what they started to notice was patterns from their team talking about this internal messaging tool. Then they started asking questions: "What would make your job significantly harder if it disappeared tomorrow?"

They realized it wasn't the game and the rest is history.

Practice interview

[Visual: Slide titled "Practice interview". Exercise #6 instructions: Gathering insights from a potential customer. In pairs, take turns interviewing each other. Note down anything which:

• Surprises you
• Challenges your assumptions
• Confirms what you already know.]

Now, it's time to think about the questions that you will ask out there in the market.

Write down three questions you might ask a customer when trying to test your assumptions.

Remember, keep the questions open. Listen, understand behavior. Don't focus on selling your solution.

Feel free to pause this video now and we will see you back here soon.

Identify potential solutions and business pivots

[Visual: Slide titled "Identify potential solutions & business pivots". Subtitle: "Generate practical ways your business could adapt, respond, or create value under changing conditions." Step Five.]

The final step here, which I believe is the most exciting, is identifying potential solutions and business pivots.

So, we want to use the insights that you've gained up until this point to work out potential business pivots that you can make to either grow through or survive a period of change.

Now, taking into account everything that we've done from step one to step four, we now want to look for matches between your assets or your anchors and the way that you respond.

What pivots can you make to ensure that you're meeting the changing needs of the market whilst retaining your core assets and what your customers really value about your business?

Business adaptation and pivoting

[Visual: Slide titled "Business adaptation & pivoting". Diagram shows the relationship between:

• External change
• Customer behaviour changes
• What customers actually value
• Business adaptation

Additional text:

• Pivots are not random
• Good pivots come from understanding value
• Adaptation often means changing delivery, not abandoning identity.]

Here's a great example here. If we go back to Nanam Filipino restaurant, we've already looked at the external change, the operational impacts, and the customer behavior changes as a result of that.

Example: Nanam Filipino restaurant

[Visual: Slide summarises: External change: COVID-19 lockdowns restricted dine-in hospitality. Operational impacts:

• Reduced dine-in customers
• Pressure on restaurant revenue
• Disruption to normal operations

Customer behaviour changes:

• Increased demand for takeaway
• More eating at home
• Customers wanting restaurant-quality experiences at home

What customers actually wanted:

• High-quality food
• Convenience
• Experience at home
• Trusted brand

Rather than the restaurant space itself.]

What Nanam Filipino restaurant realized is that instead of customers wanting the restaurant space itself, what customers really wanted and valued was high-quality food, convenience, experiences at home, as we've already discussed, and that trusted brand.

So, what was their pivot or their adaptation?

[Visual: Slide adds business adaptation outcomes:

• Launching "Nanam Hits Home" takeaway meals
• Creating DIY food kits for customers
• Serving both local and wider markets
• Expanded beyond dine-in

Highlighted message: "They didn't change the value they provided, they changed how it was delivered."]

They launched Nanam Hits Home takeaway meals. They created the DIY food kits for customers. This also served the local and wider market.

So you can see there's a market or geographical expansion opportunity there that they seized and they expanded beyond dining in.

So the really key point here is that they didn't change the value they provided, they just changed how it was delivered.

Brainstorming potential pivot opportunities

[Visual: Slide titled "Brainstorming potential pivot opportunities". Graphic illustrates idea generation and business adaptation concepts.]

So we now get to brainstorm potential pivot opportunities for your business.

Here's some examples to help your thinking.

If we're looking at pivot type, it could be things like a new customer segment. What's an example of that? It could be the same service for a different audience.

Thinking about new delivery methods, can you look at online subscription, etc.?

What about things like partnerships? Who else can you collaborate with?

And obviously, there's always that operational pivot that we can look internally. What does automation, AI, or outsourcing mean for our business?

[Visual: Exercise #7 slide: Get creative with potential ideas. Quantity first. Don't judge ideas too early.

Then identify:

• What customer need it responds to, or value it delivers
• What strengths it uses
• What assumptions need testing
• One small step to test it.]

Now, it's time for exercise seven.

Write down as many pivot opportunities as you can think of for your business. I want you to get creative with ideas here. Don't think about how you're going to deliver them or solve them or build them. It is really about challenging your thinking.

We're going for quantity first. Do not judge those ideas too early.

And then when you have a moment, select the most promising idea and really start to think about and identify what customer need it responds to or value it delivers, what strengths it uses, what assumptions need testing, and what is one small step to test it.

And we will cover that off more soon.

Feel free to pause this video now, and I will see you back here soon.

Testing the feasibility of a solution

[Visual: Slide titled "Testing the feasibility of a solution". Key message: "Start small. Learn quickly. Adapt early." Accompanied by a framework graphic.]

So, now you've had the opportunity to note down a few potential ideas. We want to test how feasible these are for your business.

The key principles here, starting small, learning quickly, and adapting early.

And here's some great examples.

If what you want to learn is, do my customers actually want this? Well, what are some of the possible low-risk tests that you can use?

You could have customer conversations, my personal favorite, expressions of interest, different wait lists for products, etc.

One question we really want to test is, will my customers pay for it?

Well, there's a lot of different options outside of customer conversations. You can have things like setting up pre-orders, paid pilots, limited releases.

And one of the really great questions we want to ask ourselves is, is the demand consistent or temporary? This is going to help you understand whether you invest considerable time, effort, or money into this solution.

A low-risk way you can look at this is by testing over time across different customer groups.

Wrap up: Pivoting

[Visual: Slide titled "Wrap up: Pivoting". Key messages:

• Lead with the demand when ideating your solution; you have to go to where the market is
• Identify your key business assets and leverage these
• Consider the timeframes
• Don't focus on complete clarity or perfection when designing a solution
• Recognise that you may need to change again.]

This brings us to the end of part one.

Now to wrap up for pivoting, in summary, we need to lead with demand when ideating your solution. You have to go where the market is.

Really consider the time frames. Is it a fundamental shift in the landscape or something you need to weather for the short term?

Identify your key business assets and leverage these. The aim is to protect these key assets and eliminate the things that no longer serve your business.

Don't focus on complete clarity or perfection when designing your solution. Test it, learn from it, and iterate as you go.

And finally, recognize that you may need to change again. The biggest asset a business can have is adaptability. So, how can you build this into your business?

This brings us to the end of part one of the Adapting to Change workshop.

Come back soon for part two, which is all about building agility and resilience into your business.

See you soon.