In a down economy the natural instinct is to draw inward. Cut spending, slash budgets pull back initiatives and horde cash and resources. The problem with that approach is that a down economy may in fact be the best time to win by being creative. That means investing in creativity when the competition isn’t. When it comes to leveraging an investment in innovation and “Design Thinking” it requires an investment in not only capital but risk as well. To succeed by design in a down market not only will require the opposite of withdrawal but ad some risk thrown in for good measure.
Experience suggests that all three elements are required to appear in abundance. When the formula is adhered to it almost never fails. Withdraw risk and reward opportunities are diminished. Without a creative approach risk is simple ill- advised. Too little of each creativity and risk and the return may not be worth the effort.
Companies who slash investments in their Innovation efforts may find the damage to their long term interests far outweigh the short term money savings. After all the playing field in almost every industry is global now and the competition may not be withdrawing at all, in fact they may be investing.
Every year there is a Conference held in California. The Technology, Entertainment and Design, or TED Conference. This year’s TED Conference sold out early. Perhaps the world’s most expensive Design gathering, which also expanded it’s capacity by changing venues, sold out in record time.
Companies that are succeeding by leveraging design adhere to the counter intuitive notion that to innovate quickly we need to think long term. A long view is what allows capital to be aligned, efficiencies to occur and leadership to orchestrate efforts of diverse teams on diverse assignments.
The failure of some recent business institutions dependent on tried and true methods is in many ways because they benefited the few. Design is a truly populist endeavor. Everyone benefits from the answers to problems created and made in ways that change the world around us meaningfully. Failure of old ways actually clears the path for creative thinking and new models.
For example, companies are placing a new priority on achieving design solutions that reflect well on the earth and their business practices. Advantages in sustainability will create game changing opportunities. Every company that source reduces material and shrinks footprints etc…will on the one hand achieve some success in sustainable practice. On the other hand these positives may be hard to discern on shelf or in use, in fact in some cases may actually make it harder to sell or use, opening the door for truly creative re-inventions of existing paradigms. New use models, new sharing and return models etc…game changers instead of incremental improvement.
When things aren’t going well sure, the first reaction generally is to take fewer chances not more.
“Bold moves in bad times can pay-off big…a recession creates winners and losers just like a boom”. (Wharton Professor Mauro Guillen)
Everyone will cut back on travel and freeze hiring; design is still going to be the differentiating factor after, but also during a recession. If sales as are harder to come by then the buying propositions presented need to be more compelling and design is the best way to do that.
The job ahead is made additionally difficult by the kind of cultural hurdles that must be cleared to leverage creativity and design thinking to best advantage. Most businesses are set up with protocols, firewalls and policies designed to minimize risk. Sure it Ok for Google to allow their logo to be manipulated but that will never work for us.
That kind of thinking won’t cut it in an economy down for the moment but with creativity differentiation and innovation at the core of its success or failure in the future.
It can cost more to catch up in the long run.