In my blog of March 20 I suggested the crisis is a good time to be thinking about innovation, especially for those companies that still have reasonable cash flow or employees with some time on their hands. It was therefore pleasing to see my comments justified this week on two web sites. First the World Advertising Research Center has an article on how P&G, Unilever and Wal-Mart plan to use the crisis to out-innovate their competitors. P&G plans to outspend them on innovation, Wal-Mart to use the time to refocus on customer loyalty and Unilever to co-create new AXE products with customers. WARC article on innovation in the crisis
Similarly the Economist Intelligence Unit has a sponsored paper on “Taking advantage of the pit stop: How to prosper in a recession.” EIU paper Their conclusion is "A company with a strong team and a pipeline of new products or services is going to be in a winning position when the recession finally bottoms out. For the rest, playing catch-up when resources are once again scarce and expensive is going to put a significant drag on recovery."
And they make three great points here, rethinking your business model, finding new talent and finding new markets. The Innovation Manual covers new business models and new markets extensively. Both are important to growth and profitability ands both involve mind-sets, skills and tools that many managers are not familiar with. So in the Innovation Manual I place great emphasis on using evidence-based theory to identify the right people and the right tools for the task. The point the EIU makes on talent is that of making sure you don’t layoff talented people during the crisis, talent which cost you a big investment to develop. You may find it is not easy to hire similar talent when economic growth returns. I would take this point further, as follows.
Working at a top business school I also see many talented MBAs looking for work right now. Individuals who before might have thought about a career in consulting or investment banks (remember those). But now they are much more open to jobs in mainstream firms, the firms that create and deliver innovation rather than give advice or fund it. So the crisis is also a great opportunity to bring new people into your firm, people you would not normally be able to attract.
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