As more and more government restrictions and emergency regulations start to ease businesses are looking at ways to recover from the COVID-19 pandemic. Nearly every industry was hit hard and is anticipating financial losses by the end of the year. But, it doesn’t have to be that way.
When surveyed, 90 percent of company executives said that the COVID-19 pandemic has fundamentally changed the way they will do business in the future. Yet just 21 percent said they felt equipped to pursue growth. According to the research, an important way to prepare for the future is to avoid cutting investments in innovation, which may seem counter-intuitive. Yet, looking back at other economic crisis, the evidence is clear that what companies need to do is:
- Adapt to changing consumer desires
- Look for new opportunities
- Keep putting resources towards innovation
Most organizations will be focusing on recovery efforts and short-term plans for improving revenue. Yet, research and history have demonstrated that is not how companies survive a crisis in the long run. As counter-intuitive as it sounds if you want to become a successful organization again you need to focus on strategic innovation. That is, make a plan for growth and change.
Strategic innovation is simply the way an organization reinvents itself or adjusts to changes in the marketplace. The focus is on business growth and gaining an advantage over your competitors. Although it is not a new concept for most companies, recovering from the COVID-19 pandemic will require a vast amount of innovation.
Focus on Growth
It is natural for organizations to want to strengthen their consumer base at this time. The thought of making plans to expand or grow may seem a distant dream. However, to overcome the challenges that COVID-19 has created, you’ll need to focus on growth and keep your eye on the long-term. There are several ways you can start to develop a strategy of growth including:
Assess – The recent pandemic has fundamentally changed the way most organizations do business. The biggest change has been the rapid adoption of new technologies to deliver products and services. Yet, some companies have also altered the products they produce. One of the best examples is the number of distilleries who have started producing hand sanitizer. As the dust settles from COVID-19, start your recovery process by assessing the changing demands and needs of consumers. Look for new patterns of spending in your own customers as well as those of your competitor. Once you identify a change, analyze what it means and its impact on your industry.
Consider – After you have assessed how consumer spending patterns have been changing, consider some ways that your organization is equipped to respond. This should go beyond short-term responses such as making brick and mortar stores pick up locations for e-commerce orders. Rather, think about what problems or issues the changing consumer behavior reveals. Then ask your innovative teams to come up with some new products or services that can help customers overcome these issues. This can include a brainstorming session where all ideas are welcome. Then you can pick the best ideas to refine.
Change – Organizations will need to accept that the way they did business just a few months ago is history. You’ll need to identify the ways in which your former business model has been permanently changed. Then it is time to contemplate ways you can transform these models into new ones to make way for future growth.
Strategic Innovation Looks Different for Everyone
It is important to understand that successful strategic innovation will look different from industry to industry and company to company. You’ll need to discover and respond to the unique challenges, opportunities and characteristics of your industry. However, one key ingredient to strategic innovation across all industries will be technology.
The tech industry has seen rapid growth in a variety of advanced technologies that will be key to strategic innovation for organizations. This includes e-commerce, AI, virtual realities, touchless technologies and more. Once you identify opportunities to pivot your business model, consider what technologies can help you get there.
Innovate with Purpose
While most organizations innovated rapidly during the COVID-19 pandemic, in the next phase they will need to be more strategic rather than reactive. Innovation at t he beginning of the crisis was fast and focused on employee safety as well as continuing company operations. Over the next several months as restrictions ease, organizations will have an opportunity to consider innovative ways forward that are focused on core business models. The expectation will be to define ways to recover from the crisis. However, it will be important to align your mission and innovation with your organization’s long term strategy.
In the short term, we are all facing an uncertain economic time. History has shown us that companies that can balance innovation during recovery with their eye on the bigger picture of future growth do better. Research by McKinsey notes that organizations that have focused on innovation came back 30 percent stronger than companies who did not.
Keeping your eye on the long term and having a plan for growth rather than mere survival will help set you apart from your competitors during the recovery stage. Consider how hard-hit the sports industry has been as COVID-19 has forced them to cancel venue matches. However, organizations like the NBA and teams like the New York Giants and San Jose Sharks have successfully innovated their sports products to be digital ones.
The key point is that organizations need to innovate with a purpose. Whether that is the well-being of employees, good environmental stewardship or building communities, organizations that have an innovation focus are more likely to be successful in the long run.
Remember that strategic innovation is a choice, but it has proven itself to be the best way forward in a crisis.