InnovationManchester

Innovation strategy in a recession

Posted on: August 21, 2009


A good article caught by attention via the Linkedin Continuous Innovation group.

It explores the dilemmas of innovating during a economic downturn and makes three very good points.

Firstly does innovation increase profitability levels in the short term? Often companies are under pressure to find quick solutions to problems which inevitably leads to short term cost cutting measures.

Innovation contains the assumption of long term gains and cost cutting will often bite into the resources that an organisation needs to innovate

Secondly the premise that innovation is risky and risk and recession don’t often mix.

Here the distinction needs to be made between innovations with high risk and uncertain outcomes which look at future markets that have yet to be created and test and those low-risk innovation which focus on the provision of the highest value at the best price to existing markets.

Thirdly how to match future levels of demand from innovative products or services against existing cost structures

How much to invest, how long will it take to reap the benefits and how much will be reaped?” are usually the three major concerns of organizations when it comes to innovation.

What other issues do you feel impinge on innovation strategy?

We would love to hear your views

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1 Response to "Innovation strategy in a recession"

While the article makes lots of good points, I still think that innovation is a necessary part of making it out of an economic recession. I actually recently found a great new book that helps fuel this idea called Exploiting Chaos – 150 Ways to Spark Innovation During Times of Change by Jeremy Gutsche. There is actually a free preview of the book available at http://www.exploitingchaos.com.

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Innovation Manchester

Innovation Manchester is a dynamic and diverse network of innovators and entrepreneurs, working together to make Manchester a better place to do business. We’re making Manchester a global innovation leader by creating: - new connections - new business opportunities - radical city-wide solutions Be part of the innovation conversation - all you need is enthusiasm and original thinking.

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