Sunday, April 8, 2012

How Many Times Will you Pivot?

When you start a business, you better have a clear vision in mind.  It's critical to get your elevator pitch down.  You need to be able to explain to others, exactly what you're business is all about in 30 seconds.

When we started TUSC, I would to people that we were in the business of building custom software for organizations...and the pitch went on for 2-5 minutes.  One day I was sitting in a board meeting with a group of CEOs.  One of my competitors was in the meeting that day.  One of my CEO friends, who was a banker, said to my competitor - "so what do you guys do?"  It was time for his elevator pitch.  He said "the same thing as Brad, but for Microsoft."  The banker looked my competitor very confused and said, "if you can explain to me what Brad's business does, that would be great, I've been trying to figure that out for 2 years now."  That's not a good sign!  In fact, that was a HUGE wake-up call for me.  Clearly we did OK at explaining what we did to our customers, who were technical people, but CEOs couldn't figure out what we did.  So your elevator pitch has to be relevant to those you give it to.  My CEO elevator pitch then was refined to "we do Oracle, anything with regards to Oracle software, so if you know anyone who has Oracle - please have them contact me."

Our original vision was to be the best consultants in the world around the Oracle software.  To us that meant we were going to build software from the ground up.  We wanted large projects that would allow us to do things right.  However, the market was in need of consultants would could tune their Oracle applications and make them run faster.  That's not what we had in mind.  We didn't want to be firefighters.  But we listened to the market.  We didn't get stuck on "no, our vision was to do big projects, now give us a big project or we're walking..."  Those little projects became our foot in the door...that later (about 5 years later) resulted in us landing large, from the ground up projects.  Which was about the same time that developing custom software was no longer in vogue.  So again, we had to pivot and listen to our customers.  We build an Oracle Apps (ERP) business.

It's not just about listening to customers, but listening to those who can help you.  There was a recent Shark Tank where the guy had wine and a great glass (individual serving of wine for sporting events, weddings, etc) to store wine in.  The sharks were only interested in the glass.  They didn't seem to like his wine.  They tried to explain that the market is WAY bigger than his wine.  But...he didn't want to sell that off because he wanted to sell more of his wine with the glass.  I get it - he came up with the concept so he could sell more wine...but...what does it matter who's wine it is?

As I always say, you can stick to your vision and end up with 100% of nothing or you partner and listen to people and end up with a whole lot more!  At the same time, you don't want to change your direction every week or for that matter very often.  You can't turn a large ship very need to make minor adjustments.  Businesses that pivot are generally the most successful business, but the optimal pivots is about 2.  So come up with a vision, run it by others, listen, refine your vision and then go try to sell your visions to customers...and LISTEN!  What is it they are asking for?
Post a Comment