The Pivot Paradox

The ability to pivot isn't just important, it's the difference between thriving and dying. But here's the thing: most organisations’ approach to pivoting is all wrong. They treat it as an emergency procedure, something you do when things go terribly off track. That's like saying you only need to steer a car when you're about to crash. The truth is more nuanced and far more interesting: the best organisations are constantly making minor adjustments that add up to massive transformations over time. They build the machinery for change into their everyday operations, not as a break-glass-in-case-of-emergency option.

I've spent years observing companies and ecosystems adapt or fail to adapt to change. The ones that succeed don’t just react; they develop what academics call "dynamic capabilities." That's just fancy language for being good at three things: noticing what's happening, quickly taking advantage of it, and reshaping yourself accordingly. These capabilities may sound obvious in theory, but they prove remarkably difficult in practice. Most organisations are designed for execution and efficiency within known parameters, not for detecting and adapting to shifts in those parameters. This is why incumbents so often get blindsided by startups, despite having vastly more resources. Resources aren't the constraint; the ability to rapidly redeploy them is.

Consider Microsoft. In 2014, they were a Windows company with a death wish. Their stock had flatlined for a decade. The smartphone revolution had largely passed them by, and cloud computing threatened their core business model of selling software licenses. Then something interesting happened. Satya Nadella took over and said, "We need to be cloud-first." That wasn't just a slogan; it was Microsoft acknowledging that the world had undergone a fundamental change. What's remarkable isn't that they made this pivot but how completely they executed it. They reorganised the company, reallocated engineering talent, redesigned their economic models, and even changed their culture from competitive to collaborative. The result? Microsoft's market capitalisation increased from approximately $300 billion to over $2 trillion. This wasn't just a strategy shift; it was a complete reimagining of what Microsoft could be.

The tech graveyard is filled with companies that saw the same signals but couldn't execute them. Kodak invented digital photography but couldn't bring itself to cannibalise its film business. Blockbuster saw Netflix coming but couldn't reconfigure fast enough. BlackBerry dominated the smartphone market before Apple, but couldn't quickly sense the future of touchscreen devices. In each case, the failure wasn't one of perception; these companies often saw the change coming, but rather one of mobilisation and transformation.

Why is pivoting so hard? Because it requires three distinct skills that rarely come together naturally in organisations:

First is sensing. This isn't just collecting data; it's having the intellectual honesty to see what's happening rather than what you wish was happening. It's recognising patterns before they're apparent and distinguishing signals from noise. When Google bought Android in 2005 for just $50 million, most people thought they were crazy or distracted. Why would a search company need a mobile operating system? Now, Android powers about 70% of the world's smartphones. Google sensed the mobile shift early because they were paranoid about missing it. Their leadership asked the uncomfortable questions: What if search moves primarily to mobile? What if we don't control that platform? Those questions led to one of the most strategic acquisitions in the history of technology. Contrast this with Yahoo, which had similar data but lacked the organisational ability to sense and interpret the same patterns.

The second is seizing. I'm always amazed how many organisations spot opportunities but can't marshal the resources to capture them. They get stuck in endless committees, budget cycles, or turf wars. Apple wasn't first with smartphones, but they seized the opportunity better than anyone. When Steve Jobs recognised the potential convergence of phones, internet devices, and music players, he didn't just assign a team to work on it; he reoriented much of the company around the iPhone. They reallocated resources, formed new partnerships, and completely reorganised their operations. Most companies find a thousand reasons why they can't move that decisively, and by the time they've finished debating, the opportunity has passed.

Third is reconfiguring. This is the hardest part. Many organisations can temporarily mobilise for a special project or initiative, but fundamentally changing how you operate is another matter entirely. Netflix didn't just add streaming to its DVD business; it completely transformed itself, twice, first from DVDS to streaming, then from content distributor to content creator. Each transformation required dismantling successful operations and building entirely new capabilities. This kind of willingness to cannibalise your success before someone else does is exceedingly rare.

The most interesting pivots happen at the ecosystem level. Look at Israel. Their entire tech ecosystem has sensing mechanisms built in through military service, academic connections, and dense networks of entrepreneurs. Or Toyota, which is now questioning its legendary just-in-time system after COVID exposed vulnerabilities nobody imagined. These ecosystem pivots are fascinating because they necessitate coordination among many independent actors without centralised control.

After years of observing successful pivots, I've noticed that the leaders who execute them share a distinct psychological profile. They're not emotionally attached to their original ideas or initial success. They're committed to solving problems and creating value in whatever form makes the most sense as conditions change. When Reid Hoffman started LinkedIn, he wasn't obsessed with creating a professional network; he was obsessed with helping professionals connect more effectively. That distinction matters enormously when the world shifts. It gives you permission to abandon what you've built and move toward what works.

The pivot paradox is this: to execute a successful pivot, you need the conviction to act decisively, combined with the humility to recognise when your original plan is wrong. That's psychologically difficult for most of us. We often lack the confidence to make bold moves or the humility to admit that our initial direction needs correction. The rare leaders who balance these qualities create organisations with actual adaptive capacity. They build sensing networks, create resource mobility, and foster cultures comfortable with reinvention.        

If you run an organisation, whether it's a startup, a corporation, or a public institution, ask yourself:

• Do we have mechanisms for honest sensing, or do we filter information to fit our existing views?
• Can we mobilise resources quickly when opportunities appear, or are we trapped in rigid planning cycles?
• And most importantly, are we structurally and psychologically capable of reinventing ourselves when necessary?

The best leaders aren't those who make the fewest mistakes; instead, they are those who learn from their mistakes. They're those who correct their course the fastest.

Thoughts?