Focusing on less, but more promising initiatives, organizations can revive their innovation program during times of crisis.
Facing economically hard times, companies often tend to cut down their innovation expenses to brace or make up for potentially lost revenue. But is this approach advisable at all? In our work and many strategy projects with business of all of all sizes, we have made experiences that point to a different recommendation. Therefore, we have formed three theses on innovation strategy in economic down-turn. With these theses in mind, you can ensure that your organization uses its innovation resources sensibly in times of crisis.
By cutting a certain percentage of expenses across the board, companies keep all of their lousy projects alive, while also hampering their most promising and successful initiatives. A far better way is to reset your innovation strategy and focus on fewer projects that are worth being pushed through hard times. Meanwhile, an „innovation standstill-agreement“ can be put on all other projects that are not in line with the adapted innovation strategy. So, in short: concentrated, bold strategic moves instead of blanket cuts.
During times of down-turn, many contributors to innovation within an organization are very busy with their day-to-day jobs and tasks. This is why you should adapt your innovation team and reduce it to the max: Dare to reduce your team to those who are not engaged elsewhere, but are able commit 100 percent of their time to innovation. All others will be involved based on the „need-to-know“ principle, and can fully focus on their other tasks for better results.
Like we mentioned in our last post, especially during economically harder times, users tend to look for a clear and forthcoming value when considering new solutions or business models. That is why you should focus on those innovations that pay off for your users in a foreseeable future, and also help to clearly display these benefits, rather than pouring innovation resources into fancy, high-risk solutions and business models.
If you want to further increase your company’s resilience against the effects of a possible recession, then please join our event Success Through Digitized Strategy: Innovation Management on November 30. Get in touch with leading experts in the field of corporate strategy and innovation research, and learn how a digitized approach to innovation can help to transform creative ideas into initiatives that create sustainable value and ensure long-term success.
