Master the ability to pivot your business to leverage success

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Business plans are like panning for gold. Miners had to start with just a guess about an area, cover a creek, and then sift and sift through endless piles of dirt. Prospecting has all but disappeared, but it’s a useful metaphor for how business leaders approach a problem, solve it, refine and revisit it, and continually adapt—even to the point of destroying the essentials of their business. This skill is called “intellectual range of motion” and it is one of the most important tools of a business leader – especially if you are selling your expertise.

Peloton, for example, continues to exhibit this intellectual range of motion. While it had some pain points – lower subscription growth, stock redemption issues and a wave of layoffs – Peloton shows a willingness to explore and change direction.

Today, Peloton has 5 million customers and is worth $3 billion. However, despite significant brand equity, Peloton is substantially changing its business model. The company is muddling the waters of service-based versus product business dynamics and launching a “Fitness as a Service” product, where people can access Peloton’s training and instructors without the bike itself.

Related: Why Founders Should Always View Pivots as Opportunities

Intellectual range of motion: a powerful tool

The extent to which an idea can be changed based on an entrepreneur’s intuition and imagination falls within their intellectual range of motion. A wide range of motion allows an entrepreneur to turn an idea into a revenue growth opportunity. In contrast, business leaders with narrow intellectual swathes fail to recognize an opportunity because of the limits of their imagination.

Intellectual range of motion is valued more in a founder of a service company than in a product company. That’s because services are much more malleable than products. For example, modifying a product to take advantage of an opportunity might require sourcing new raw materials, reconfiguring an assembly line, rewriting software code, developing a new manufacturing process, and much more. Services have none of that, so time from idea to execution is measured in days and sometimes hours.

As a founder, I grew my company by increasing my intellectual range of motion. For example, the industry I operate in, business mentoring communities, is over 200 years old with a few hundred companies. All of these companies are horizontal providers, which means they don’t serve a specific vertical industry. My company, on the other hand, serves a single industry – the professional services industry.

This industry specialization has attracted many and has allowed our company to grow consistently. The idea of ​​this form of differentiation was found in another business entirely: SaaS. The software category has matured and many successful SaaS companies now specialize in a vertical industry. My idea was that this could (and should) work in the business mentor community sector – and it did. Recognizing a winning strategy in another industry and successfully transferring it to another is an example of intellectual range of motion.

Related: Is it time to streamline your business? These are the only two signs you need to look out for.

Key strategies for improving intellectual range of motion

For entrepreneurs and founders who want to achieve better intellectual ranges of motion, there are some critical actions to take:

1. Ask: What does the world need from me right now?

This question is not asked often enough. The reason this issue is overlooked is that business owners fall into the rut of delivering what they always delivered. Due to experience curve benefits, the longer a company provides a service, the lower the cost and the higher the margin. Business owners are profit driven and will not discontinue a profitable line of service until absolutely necessary. As a result, they stick to knitting for a long time and miss opportunities. Over time, this behavior restricts intellectual range of motion.

Blockbuster Video has already provided us with a remarkable service: hit home movies for rent. They stuck to VHS tapes but lost out on mail-order DVDs and streaming video. As a result, they went bankrupt and now we all watch Netflix content. Blockbuster Video is out of market; the market evolved into services that reached them, and eventually into fully digital and personalized streaming platforms. This is something professional services company founders need to consistently ask themselves to stay competitive in the marketplace, but the lesson remains for large companies like Blockbuster as well.

Related: Don’t Make the Same Mistake as Leaders at Kodak, Blockbuster, and Xerox Make When Disruption Comes to Your Industry

2. Locate wasted resources in legacy operations

A common reason why new ideas that could lead to great growth opportunities are not pursued is that entrepreneurs incorrectly think they don’t have the resources. However, the resources they need are available, they are just consumed with legacy operations.

Legacy service offerings are ready for optimization. Entrepreneurs must look for ways to provide these services with far fewer resources. These newly freed resources could be allocated to today’s wild idea that could be tomorrow’s goose that lays the golden eggs.

Related: 4 mistakes to avoid when expanding your infrastructure

3. Produce a roadmap of future offers

It is better to organize the roadmap for offering services by identifying limits. Today’s businesses and tomorrow’s businesses are always competing for scarce resources. There is only so much money, time and talent for everyone. In the absence of a roadmap organized by time limits, today’s businesses win the competition for resources. A roadmap ensures that tomorrow’s businesses get the resources they need.

For example, threshold 1 of your roadmap should be set to offers in the market for the next year. Boundary 2 should be defined as an offer on the market two years from now. And threshold 3 should be defined as offers on the market in three years. By planning the roadmap in this way, an entrepreneur’s intellectual range of motion increases by stimulating his imagination.

Related: 6 Ways to Push Your Limits and Accomplish Things You Never Thought Possible

Business leaders who want to leverage their success – or simply maintain it – should look to see how they can improve their intellectual range of motion. In the long run, they might just strike gold.

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