How an uncertain economic environment can be the main driver of innovation


The COVID-19 pandemic has transformed the world and has also provided organizations with a great opportunity to innovate and find new growth potential.

Catastrophic circumstances such as the present one push humans to the brink, causing them to expand their imaginations. When environmental dynamics change, it creates new opportunities hitherto hidden from our vision. From finding new uses for products to designing new business models and creating absolutely new products, history is filled with interesting examples of groundbreaking innovations.

General Electric, Hewlett Packard Enterprise, MTV, CNN, FedEx, AirAsia, Burger King, Google, eBay, Airbnb, and the list goes on – if there is one thing that is common to these companies, it is that each of these innovative companies was created in the midst of a recession! The history of mankind has been a history of ingenuity and innovation in difficult times of uncertainty.

To thrive in this VUCA world, organizations and institutions must be able to innovate with agility, not only now but even after this crisis is over. In this context, digitally savvy and mature organizations have an advantage over others.

Innovation is the key

Interestingly, uncertainty as a phenomenon has increased over the past 30 years. In numerous research studies conducted in recent years, business leaders around the world have identified innovation as a key area of ​​interest in times of uncertainty.

In the first weeks after the World Health Organization declared a global pandemic, research indicates that companies in different industries have innovated rapidly. This tendency indicates the natural human tendency to react with agility when we are faced with difficult uncertainty.

New initiatives and collaborations

The pandemic has also shifted the focus of business innovation. As it began to unfold in spectacular fashion, the world witnessed many exciting examples of rapid innovation.

For example, many retailers have converted their physical locations to convenience stores, movie studios have started to consider streaming services bypassing conventional movie theaters, hotel chains have offered workspaces at daily rates, and Passenger airlines switched to cargo flights only when passenger demand declined.

New types of collaborations have also evolved, where a drugstore chain has linked up with the logistics provider and started delivering essential medicines to elderly residents of a retirement community, via drone services. Most of these interesting initiatives actually took place just weeks after the COVID-19 crisis.

Innovate with agility

In times of growing uncertainties like these, the ability to innovate with agility becomes extremely important. A critical dimension would be to realign existing knowledge, resources and technology with emerging needs.

For example, during this phase of rapid innovation, pharmaceutical companies realigned and repositioned existing drugs for the treatment of COVID-19. Alcohol companies began to venture into the manufacture of hand sanitizers and similar products, various other industry organizations changed their production capacity to manufacture products relevant to the pandemic such as face shields, equipment personal protective equipment and face masks.

In the near future, human and technological innovation will translate into smarter solutions and smoother businesses. This could include smart health, driven by data analytics and tracked by the Internet of Everything; distributed work that will encompass agile, remote and independent options; automated, contactless and cashless retail platforms; personal mobility that will be individual, electric and local; and lifelong education with flexible and hybrid options.

This catastrophic historic event certainly validated the power of human ingenuity and how innovation can thrive even in uncertain times. To ensure business continuity, it would be helpful for organizations to understand this and explore ways to realign their focus and achieve rapid growth – now and in the future.

Edited by Teja Lele Desai

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)


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