The ballet of business

Changing direction, products, models and marketing is a hard task for a business. We chart what it takes to turn a business around, plus profile four successful pivots.

- ALAN DEANS

Companies are increasingly ramping up returns by embarking on new growth paths. So-called pivots are being used by a diversity of businesses, with the goal of turbocharging financial returns for shareholders by expanding an existing operation or starting a new one.

Unlike mergers and acquisitions, they are not always obvious - at least in the early days. They involve scaling up part of a business to cash in on significant growth that is believed to lie just around the next corner. Managers often remain tight-lipped in case their strategies turn sour. Pivots let them demonstrate success before declaring what they are up to. If their plans don't work, they switch to something else.

It takes a talented group to spot and develop such opportunities. That can involve keeping tabs on their competitors or knowing what technologies and strategies are growing in their markets. By acting quickly, they aim to turn the tables on their competitors by snatching sales and boosting profits. Pivots can involve products, business strategies, marketing and even devising new uses for a tired old technology. This is often hush-hush so they hold an element of surprise until the time is right. The financial rewards from the best pivots can be huge and may deliver for many years before rivals find their own means of catching up.

Pivots happen in all sectors, at any time. They are made by any sized company operating in any business sector - finance, technology, retail to name a few. They share one cause - taking big risks because changes in technology or aggressive competition eats into their market share. Profits wither.