I just listened to a podcast about an automobile parts company that was facing significant challenges in the current COVID-19 crisis. With auto plants all over the world shut down, they were facing an unprecedented crash of all orders and sales.
To their credit, rather than laying people off and contracting, they looked for new opportunities. It turns out that one component they manufacture is pistons for various automobile applications. It just so happens that ventilators use pistons—ventilators that are now in unprecedented demand.
This company was able to shift its production to producing ventilator-sized pistons quickly. They already have partnerships with several manufacturers and a huge backlog of orders. That’s a pivot of a business model that will enable the company to not only survive this crisis, but to actually grow their revenue in 2020.
I’ve noticed that many organizations are taking the opposite approach. They are canceling projects and investments to create a surplus of cash. That isn’t necessarily a bad thing, but the question is, do you sit on that cash…or do you re-think your strategy—and thus your investments?