With the advent of the coronavirus pandemic and the feedback loops produced from global lockdowns rippling through the economy we have entered the era of low-cost, ‘budget everything’ and corporate innovation is no exception.
Prior to the pandemic innovation required fertile soil and constant attention to flourish and grow. That soil isn’t so fertile anymore. As before, organisations will require a return on investment from their innovation efforts. The big change is cultures are becoming less forgiving and more demanding.
Let’s start with the fundamentals, and ask a question that is more challenging to answer now: what is innovation? What innovation was in January is different now. Definition clarity is foundational to the process of updating your interpretations to more accurately reflect the reality of our changed marketplace and the new future we are creating.
We are witnessing radically different trends in our work facilitating collaborations of corporate innovation teams from varying industries. There’s a transition to addressing short term challenges such as deploying new technologies and digital tools that enable ‘work from anywhere’ environments. Innovation teams are using adaptable skillsets, connectivity to resources, and innovation management processes to run quick pilots to determine what works and what doesn’t in this new season.
What’s most noticeable about current corporate innovation operations is significantly fewer resources and much less support. Autonomy is up, headcount is down, while budgets are slashed or frozen. Teams are embracing low-cost alternatives while gold-plated solutions are halted; high-cost consultants – gone; shiny new software – on hold; hiring – forget it. This season will be branded the low-cost/no-cost, budget era with corporate innovation teams using new strategies and practices to manage their efforts. Regardless of the specific shape of the recovery we’re operating in a scarce resource environment and these trends won’t end soon. In fact, it’s prudent to prepare for a prolonged period of operating with fewer resources and support.
We’re also witnessing more DIY (do it yourself) strategies. Innovators are being forced to manage their efforts amid frozen budgets and fewer resources while delivering against a steeper set of deliverables. Do-it-yourself strategies open opportunities to develop deeper partnerships with internal and external partners while leaning on the resources that remain. One of the least expensive practices available to all innovators is benchmarking with peers and learning what’s working and not working in other industries and organisations. For example, a one-hour phone call with a peer can open new thinking not readily available from within the four walls of your organisation. At face value, this may seem like a simple strategy. In this season reliable, dependable and simple solutions are winning the day.
Some would call this ‘Open Innovation’ whereas new strategies and practices are sourced from external collaborators. It’s an effective and immediately available practice that can be used to gain access to solutions that might not have otherwise been considered. It offers the added benefit of insight into a rapid and radically changing marketplace. The creativity, tools, frameworks, contacts, networks and opportunities are readily available, but it takes engagement to fully utilise this resource.
But a word of caution – the window for rolling out new innovations that might not have been tolerated before will soon close. The C-suite and investors are showing a relaxed and open mindset to solutions that can deliver value now, and if they offer longer-term benefits then this is a bonus. An example we’re all witnessing is a remote and ‘work from anywhere’ setup. If productivity can be maintained, we’ll see more of this in the future. In the last week alone, we’ve seen tech giants Twitter and Facebook announced their intention to permanently move to a more remote workforce. Expect more of these announcements soon.
The Theory of Constraints is a useful model to lean on now as well. Operating within clear boundaries and limited resources reflects our new reality. Fortunately, humans excel in this environment. A renewed and focused effort on ‘budget innovation’ can reveal what’s possible from a corporate innovation team. Along with the practices we’ve discussed, moving first and then persistently can serve as a framework. Many new innovations have already been created and launched as a direct result of the pandemic especially those efforts serving the health care system. There are others as well: technologies (i.e.; cyber-security to protect remote workers), practices (i.e.; Zoom meetings, distance learning) and new ventures (i.e.; startups, food delivery)
Many Fortune 500 businesses were created during downturns. A 2009 study found that over half of all Fortune 500 companies were started during a recession or downturn including General Motors, AT&T, Disney and MTV. These downturn periods reflect a term that Joseph Shumpeter coined ‘creative destruction’ that represents periods of economic churn. The pandemic is no exception. Bankruptcies are already piling up within the retail, airline and real estate sectors revealing the destruction. But we’ve also seen new businesses launch within the previous two months and this is encouraging. Over half of all new jobs created during the Great Financial Crisis were created by new businesses. To repair our economy, these new businesses need to be supported and nurtured. Corporate innovation teams would do well to pay close attention to these businesses as new opportunities for partnering and collaboration abound.
Each organisation and industry are experiencing varying degrees of consequences from this new season. For some the opportunity to take their rightful seat at the leadership table is now. Innovators with their unique skills, toolboxes and frameworks can lead in an age of abrupt and radical change. The case can be made that innovators were built for this moment. Their time to shine has presented itself in the form of a global pandemic. The only question that remains is will you take the opportunity to lead your organisation out of this season into a new future?