Major economic shocks, such as the Covid-19 pandemic, make business prospects uncertain and companies less willing to invest in activities that are risky and whose returns are long term. Some ask: how can we prioritise innovation in the face of questions of survival? However, successful leaders know that crises will not last for ever and recovery will start eventually. The new economic landscape is likely to be very different from the old one, and in order to adapt to changing economic environments and stay competitive, organisations will have to innovate.
Embracing the change
Crises present organisations with unique opportunities that allow leaders to think more freely and move rapidly to create impactful change. As organisations grow, the structures underlying their stability, predictability and efficiency become stronger. Crises change that (1). For instance, in the face of the Covid-19 pandemic, the higher education sector has to respond to many challenges including education continuity, the impact on exams, uncertainty over admissions, and the longer-term impact, both financial and reputational. Universities, where organisational structures and processes remained unchanged for years, face a stark choice: adapt or suffer severe consequences.
Although many institutions have been tinkering around the edges with online learning for several years, progress was slow. Now universities have closed their campuses, students have been sent home, and faculty are being asked to conduct classes online. At one stroke, all universities have been pushed into offering online learning. Embracing the change and investing in innovation suddenly became a means of survival.
In times of crisis, businesses have always been forced to regenerate and innovate. Austrian economist Joseph Schumpeter referred to the “gales of creative destruction”: unstoppable but necessary forces to drive innovation in times of crisis (2). For example, in the 2008 economic crisis, companies that continued to focus on innovation, such as Amazon, were well positioned to put a substantial distance between themselves and competitors (3). On the other hand, companies that decided to de-prioritise their innovation efforts, such as General Motors, struggled to survive (3). This highlights the importance of investing in innovation before it’s too late.
How to drive innovation in a time of a crisis
Continue to invest in knowledge, human resources and structure
Research shows that continuing investment in knowledge, human resources and structures is the best way to cope with uncertain situations. New sectors and technological opportunities will emerge after the crisis and a process of re-specialization is expected to be crucial for recovery (5).
Identify new business opportunities generated by the crisis
With great change and uncertainty come great opportunities. Crisis often forces organisations to think outside the box. To deliver results and survive, they need to improve efficiency and eliminate waste. Bureaucratic processes are pushed away to make space for innovative thinking. The current situation has revealed a number of inspiring businesses that are finding new ways to evolve and seize opportunities that emerged from the crisis.
Move quickly, perfect later
Most organisations move slowly when making operational changes or commercialising innovation. This often stems from inefficient or unnecessary processes. In times of crisis, businesses must seize opportunities quickly (6). Procedures can be skipped or accelerated, rules can be side-tracked and decisions can be made more autonomously. The time for perfecting new products and services can come later.
Expand your networks and collaborate
Recent research finds that differences in individual creativity and intelligence matter far less for innovation than connections and networks. Effective networks allow people with different kinds of knowledge and ways of tackling problems to cross-fertilize ideas (4).
Rapid Response initiative
During a crisis, it’s important to gain insights from external consultants and experts who may be able to help you assess the damage your company may face, and help you respond. In the current situation, when meeting in person is impossible, seeking expert opinions must take place online.
To help businesses innovate in the current situation, Edinburgh Innovations has launched the Rapid Response initiative.
Rapid Response helps you collaborate with the University of Edinburgh’s researchers to adapt to the current situation and build resilience for survival and future growth.
The initiative consists of three opportunities:
- Rapid Response Workshops
- Rapid Response Explore- a series of webinars
- Rapid Response Funding
1. Rapid Response Workshops
This is an opportunity for your organisation to connect and collaborate with world-leading experts from the University through digital channels. Workshops are organised to discuss the specific challenges your organisation is facing or is likely to face as a result of the Covid-19 pandemic, and explore how we can help you find innovative solutions.
To take part in the Rapid Response workshops, all you have to do is submit your questions. The challenges should be focused on maintaining and growing your business, adapting and innovating during and after the pandemic. Once challenges are submitted, we will find the most relevant academic experts to help find innovative solutions to your challenge. Find out more
2. Rapid Response Explore – a series of webinars
The Explore series of webinars has been created to provide a platform for organisations to hear from leading researchers from the University of Edinburgh. The series will see academics from different disciplines sharing their expertise, discussing the latest advances in research and presenting cutting-edge innovations and their potential impact on businesses and the economy. During the webinar, you will be able to ask questions directly to the academic speaker. If specific business challenges arise from these sessions, you can take them forward to the Rapid Response Workshops. The webinar topics and schedule will be published on our social media channels. Make sure you follow us to stay up to date:
The Rapid Response Funding call offers fast-track funding to collaborate with academics to respond to challenges or opportunities triggered by the Covid-19 pandemic. The intention of this call is not to address the virus itself, but rather to support businesses that have been impacted as a result of the pandemic to take advantage of new opportunities or tackle new challenges. Applications should be driven by an academic from the University of Edinburgh.
The funding can support collaborative research, innovation projects and virtual secondments. The latter is a great way of supporting organisations that may be experiencing gaps in expertise, knowledge and resources. If you would like to know more and discuss how you can access this funding, please contact us for more details.
Join our innovators
Edinburgh Innovations has streamlined procedures to help companies collaborate with the University’s academic experts, and we already have 40 commercial projects under way in response to the pandemic. Those projects range from increasing production of disinfectant to helping businesses improve their finances. Using our latest research to help your own organisation innovate could be our next collaboration.
We don’t yet know what the global economy will look like as we emerge from the fallout of Covid-19. It might not be enough for many companies to tweak their business models; instead, they will need to rethink more radically. Organisations should use the Covid-19 pandemic as an opportunity for innovating and driving useful change, so that once the crisis is over they can regain their strength and grow. With the help of experts from the University of Edinburgh, your organisation might be able to adapt to the new economic situation faster and respond to the changing needs of your customers.
- Clark L. (2020) Innovation in a Time of Crisis. Harvard Business Publishing. https://www.harvardbusiness.org/innovation-in-a-time-of-crisis/
- Reier S. (2000) Half a Century Later, Economist’s ‘Creative Destruction’ Theory Is Apt for the Internet Age : Schumpeter: The Prophet of Bust and Boom. New York Times https://www.nytimes.com/2000/06/10/your-money/IHT-half-a-century-later-economists-creative-destruction-theory-is.html
- Anthony S., D. (2009) After Lehman: How Innovation Thrives In a Crisis. Harvard Business review. https://hbr.org/2009/09/how-innovation-thrives-in-a-cr
- Barsh J., Capozzi M., M , and Davidson J. (2008) Leadership and innovation. McKinsey Quarterly https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/leadership-and-innovation
- Filippetti A., Archibugi A. (2010) D., Innovation in times of crisis: National Systems of Innovation, structure, and demand. Res. Policy http://www.danielearchibugi.org/downloads/papers/2017/11/striking.pdf
- Lyman L. (2020) Four ways to ensure innovation continues after the crisis. Chicago Booth review https://review.chicagobooth.edu/strategy/2020/article/four-ways-ensure-innovation-continues-after-crisis