Don’t Pivot Away From Your Old Businesses
Instead pivot around them
The relentless digital disruption of one industry after another has led many companies to quickly disengage from their older businesses and enter new, more promising ones. Strategy experts warn against exiting mature businesses too late. CEOs, considering their legacy, understandably focus on the new. But it turns out that the best response to constant and potentially devastating change isn’t a headlong, one-and-done pivot to the new.
Digital-first strategies can not only give you a jump on disruption but also breathe new life into old businesses and enable you to seize new opportunities in existing businesses. That’s what my colleagues and I found in our on-going study of over 1,300 companies, about 100 of which have learned to pursue repeated renewal and reinvention through a series of strategic pivots, applying innovation equally in the old, the now, and the new.
These companies fight the urge to prematurely abandon legacy businesses. They nurture rather than simply exploit today’s “cash cows.” And they use the additional value they uncover to fuel the new, embracing the start-up mentality of scaling rapidly when new technologies and markets solidify, often suddenly.
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