At some point, you decide to make a change. Deciding to change the way your business delivers value or the type of services that your business offers isn’t the hard part.
The hard part is deciding when to stop what you’re doing now.
What you’re doing now pays the bills. It’s safe. It’s (fairly) comfortable. People expect it. It’s shaped the way people see your business and how they think of you as a leader.
Even as you start to envision what’s next, it seems like all outside forces are pushing you to double-down on what you’ve got.
This is a problem that many of our clients face and a question I regularly ask myself: How do you build the next phase of your business while you’re working the current phase?
Business model innovation is a key activity of any business.
Okay, that’s jargony. Evolving, adapting, and optimizing the way your business creates, delivers, and exchanges value (i.e. transformation and results) is something you need to do on a regular basis.
That means testing prices, adjusting sales messaging, and iterating on existing products. But it can also mean sweeping change in the what your business offers or how it offers it.
The prospect of this is often exciting.
The reality of making it happen can be terrifying and paralyzing.
When something is working, it’s incredibly difficult to find the motivation—let alone the time—to change it. But change it you must.
Stagnation simply isn’t an option.
If you want to move from 1:1 coaching to group programs, at some point, you need to stop offering 1:1 coaching. If you want to move from physical products to digital products, at some point you need to stop offering physical products. If you want to move from small retreats to large conferences, at some point, you need to stop offering small retreats.
There are two main ways I work with clients on this big change—both of which I use myself in steering my own company.
Option 1: Shadow Offers
If the work you do is paying the bills, but you want to stop doing it, stop marketing it. The good news is that just because you stop marketing it doesn’t mean you have to stop getting paid for it.
Last year, Whitney Hess, a leader in the user experience field, worked with me to back off of her corporate gigs and add more coaching (both individual and group) to her business model. She stopped marketing her corporate consulting and started positioning her business for these new coaching offers. After a taking a few months off at the beginning of 2014, she put the plan into overdrive taking on enough corporate clients to pay the bills while welcoming a whole cohort of coaching clients. That led to her best year yet.
Often the businesses that employ this technique are getting their clients on a referral basis. Their happy former clients are sending them eager new clients, regardless of their sales pages or outside lead generation strategies. That means those sales pages can come down and their lead gen activities can stop while the revenue keeps flowing—right up until they decide to say “no” to it.
Once you take down the offers and stop actively marketing them, they become what I call “shadow offers.” They’re a part (even a big part) of the way your business generates revenue—but they’re not in the light anymore. Your business isn’t defined by them.
Often, the hardest part of making a change in your business model is teaching people a new way to see your business. By employing shadow offers, you can start the process of repositioning your business much sooner without damaging your revenue stream too early.
Option 2: Progressive Business Model Planning
In Quiet Power Strategy, one of the highlights of the program is creating a Business Model Plan. It’s not just the framework for how the business creates, delivers, and exchanges value, it’s a plan for how it will do so when all the right pieces fall into place.
However, even a forward-looking business model plan isn’t the solution for some business owners and the changes they want to make. In this case, we make 2 plans.
The first plan is a framework for how the business will create, deliver, and exchange value in the interim. It’s generally heavy on the offers that are currently generating the most revenue and incorporates an offer or two that indicates the direction the business is heading. It allows the business owner to see how she can start making decisions that support her future positioning without jeopardizing the safety of her current revenue streams.
The second plan is a framework for how the business will create, deliver, and exchange value in the future (often 12-18 months out). This is the goal plan. It reflects the projected changes when they are complete.
Moving between the first plan and the second plan isn’t like flipping a switch. It’s progressive and incremental.
We set milestones (number of sales, dollars in savings, etc…) that signal the time to make a single change from one plan to the next. Eventually, the enough milestones occur that the business model is transformed from the original plan to the new plan.
This is always how my business has evolved its model. I make a plan with a smaller change first, then make a plan for what it will look like eventually. Then, I set milestones and benchmarks for when those bigger changes will be made. That’s allowed me to transition my brand multiple times while leading my audience toward the next set of offers I’ll make.
Is it time to make a change in your business model? If that question makes you think, I guarantee the answer is yes.
Both of these options allow you to mitigate risk as you move from one business model to the next. Which one is right for you?