Efficiency is the enemy of innovation, we often hear. Yet with the looming global economic downturn and threats of recession in the U.S., many companies are hyper-focused on efficiency.
In down markets, it’s not unusual for companies to benchmark success with efficiency metrics, but this often deprioritizes innovation.
That is a mistake. Solely focusing on efficiency stifles long-term innovation and, ultimately, success.
Innovation helps differentiate companies. It helps company leaders identify new opportunities, new products, or services, and it improves processes while enhancing the customer experience – all of which lead to growth.
Here are four ways to innovate despite (or maybe because of) the economic downturn.
1. Reduce commitments
When a downturn happens, you’re inevitably left with fewer people. Sometimes this is due to layoffs, or perhaps backfill hires are not allowed.
One of the biggest mistakes executives often make in such climates is trying to get the same amount of work done with fewer people. This is the genesis of becoming more efficient at the expense of innovation.
[ Also read CIO role: 4 ways to do more with less. ]
The do-more-with-less strategy leads to errors, reduced quality, employee burnout, and the loss of high-value contributors – which can snowball into long-term negative outcomes.
When you have fewer resources, it’s critical to commit to less so that you can still innovate with the time you have.
If possible, prioritize projects and focus on the ones that create the most impact and return on investment. Put the others on the shelf for now. You can re-evaluate your list of priorities for value and relevance when the situation improves.
2. Simplify your deliverables
Companies attempt to “boil the ocean” when money and resources are plentiful. Look at the downturn as an opportunity to revisit those plans and find ways to lower costs while keeping room for innovation.
Think about it: It’s often the business requirements that cause a loss of innovation in the first place.
For example, a startup technology company wanted to include a plethora of social logins in their app, tabling some innovative features from being developed due to budget constraints. After company leaders understood what they were giving up, they quickly realized that it didn’t matter how easy they made logging in if the app didn’t have innovative features. Without innovation in their app, they’d risk losing customers. So the company's leaders changed course, and the innovations led to a highly successful release of its app, despite less flexible ways to log in.
3. Outsource your distractions
During a downturn, you may lose the ability to hire full-time employees but still have things to do and room in your budget.
Finance might be more open to a capital expense than an operational expense during these times. This is a perfect opportunity to bring in outside help to take care of your distractions so your team can spend time and energy on innovation.
Distractions take a lot of time and effort but aren’t core to what an organization does. For example, organizations today spend a lot of time supporting their applications and systems. As a result, many choose to hire outside firms to handle these activities so that their internal teams can focus on innovation and projects that grow their top line.
For example, an IT support department of four might have been cut down to one person. Other differently skilled resources from other teams might be diverted from their usual work to help handle the load. This is a distraction, as they’re trying to keep the lights on, but these skills aren’t core to their capabilities. Meanwhile, core innovation designed to support the growth and profits of the business has been put on hold.
Outsourcing, in situations like these, is an excellent alternative.
4. Ask for help
Sometimes you simply don’t have internal resources with an invention mindset or experience innovating. Consultants can help fill the gap, facilitating discussions that drive innovation and partnering with your teams to show them how to work through the innovation process.
External experts provide a critical outside perspective and facilitate conversations that drive meaningful innovation. External resources can also streamline the time to innovate by helping teams focus on priorities instead of spending time building consensus.
Simply put, leveraging consultants enables innovation to happen faster.
Innovate now and reap the rewards later
Navigating efficiency in a downturn doesn’t mean you need to lose innovation. Companies that continue to innovate now will position themselves to compete successfully as we emerge from this economic environment.
[ Learn the non-negotiable skills, technologies, and processes CIOs are leaning on to build resilience and agility in this HBR Analytic Services report: Pillars of resilient digital transformation: How CIOs are driving organizational agility. ]