12.3 C
Los Angeles
Saturday, December 9, 2023

Want Business Longevity? This Strategy is the Secret

Must read

Opinions expressed by Entrepreneur contributors are their own.

I founded my commercial real estate firm over 40 years ago and have seen tremendous disruption in my time leading it. While the coronavirus pandemic was in many ways unprecedented, our response was the same as it always has been: pivot and readjust. For instance, although we typically seek long-term tenants for our retail properties, during the holidays in 2021, we opened up availability for short-term leases to encourage retailers to rent the vacancies as a pop-up space.

Perhaps even more illustrative is our pivot in the early 2000s. We had been in business for over two decades, and our strategy up until then had been squarely focused on acquiring suburban strip mall properties — at one point, we had over 100 open-air shopping centers in our portfolio. However, around that time, I noticed my younger employees no longer purchasing suburban properties. Rather than buying a large house in the suburbs of Miami, they were choosing to purchase smaller fixer-uppers closer to downtown areas.

Our investment strategy had served us well for many years, but consumer sentiment had begun to shift, and I knew we needed to follow where the wind blew. We shifted focus and began investing in commercial properties in walkable downtown cores, and today we are the largest property owner on two of the city’s most iconic high streets.

The only way to maintain growth and overcome challenging business environments is to embrace the art of the pivot. Preparing for the type of growth that can be maintained for years and decades requires a specific mindset, and below I have outlined some frames of thought that are necessary to cultivate such a mindset.

Related: These Are the Core Elements Needed to Successfully Pivot Your Business

“Murder your darlings”

Although this phrase is more commonly used in writing and creative fields, ever since I first heard it, I have felt it is also applicable and important to the entrepreneur. In writing, “darlings” refer to aspects of a piece that an author is particularly fond of or emotionally attached to. When an author “murders their darlings,” it means they are cutting those beloved elements from their writing if they are not contributing to the overall effectiveness of the piece.

As an entrepreneur, starting your business will inevitably have an emotional aspect. You spend months or even years honing your idea and pour hours of work into your business, investing your time, money and effort into its success. It may even be that for a while, the strategy you worked so hard to cultivate is paying off, as was the case with me and my investment strategy.

Don’t become too attached to anything about your company — its strategy, structure or even product. Businesses are meant to grow and evolve, and the ones that endure are leaders who know when to move on or shift strategies.

Related: The 4 Secrets to a Successful Pivot

See mistakes as opportunities for improvement

In 1996, two expeditions attempted to summit Mount Everest. Although conditions on the mountain continued to deteriorate, those climbing had spent years training and thousands of dollars in preparation for that day, and so they decided to continue onwards and upwards. Neither expedition ever reached the top — or off of the mountain.

The 1996 Mount Everest Disaster illustrates a particularly tragic end to one of the most common logical fallacies: the sunk-cost fallacy. The sunk-cost fallacy occurs when we cannot cut our losses due to the past money or time we have spent on an activity.

In business, it’s easy to see how the sunk-cost fallacy could quickly become detrimental. Rationally, a leader may be able to look at the facts and see clearly that a strategy or product is not working, but the thought of having wasted resources can be too painful to enable them to see the problem clearly.

A company built to last won’t look at mistakes as breaking points. When something isn’t working, it provides the business with valuable information regarding refining operations and increasing growth. Reframing these moments as learning opportunities can help you recognize more quickly when it is time to pivot.

Build your company culture around it

Even if leaders are fully adept at pivoting, they will still face challenges if they cannot get their team on board. Change is hard, and if company culture isn’t built around the pillars of innovation and adaptability, change will likely be met with confusion, resistance or even anger.

Remember that you ask your employees to step out of their comfort zones every time you pivot. It will often require people to take on new tasks, enter uncharted territory and develop new skills. It is your job as a leader to ensure that throughout the process, nobody begins to feel overworked or in over their head, providing just the right amount of direction and support at the right moments while still showing trust in their capabilities.

I also want to touch on the subject of innovation. True innovation is simply solving a problem more effectively. By that definition, leaders should work to create a culture that encourages creative thinking and collaboration, and inevitably team members will be pivoting at their level every day.

It is a popular narrative now to discuss how we are in “uncertain times” of “constant disruption.” As someone who has run a company for over 40 years, I can say that while COVID-19 was undoubtedly unprecedented in many ways, we approached it like we have every other economic downturn, crisis, and changing of the tides: pivot and move forward.

Source link

More articles


Please enter your comment!
Please enter your name here

Latest article