Innovating during a recession
It was during the worst economic downturn in history that the world fell in love with Mickey Mouse.
The Great Depression, which lasted for 10 years following the stock market crash in October 1929, left 15 million Americans without jobs, half the country's banks closed, and a financial system on the brink of collapse.
But Walt Disney's business was booming.By 1934, Mickey merchandise alone was earning Walt Disney Productions $600,000 a year - $12M in today's money. Disney is not alone. There are many great stories of businesses innovating and dominating markets during times of extreme hardship or uncertainty. Take World War II, the deadliest conflict in human history which claimed the lives of of 85 million people, 3% of the world's population at the time. The War was the catalyst for countless innovations and inventions that still have a big impact on our lives today. It gave us antibiotics, aerosol cans, radar, pressurized cabins, jet engines, helicopters, and nuclear energy. Colossus - the world's first programmable, digital computer - was designed during the War to break German secret codes.
Apple's iconic iPod was created during the dot-com crisis and launched in 2001. The ruthless boom and bust of the dot-com era also gave us eCommerce, VoIP, big data, and many of the technologies we use on the web. The 2008 financial crisis produced some of the biggest companies in the world today, including Uber, WhatsApp, Slack, and Airbnb. And during the COVID-19 recession we have seen clothing companies adjust to make masks and personal protective equipment. Auto manufacturers have retooled to make ventilators for hospitals. Remote working has become normal for just about everyone, and numerous technological innovations are supporting our new ways of working every day.
There is no going back after COVID-19. Our world has changed permanently, and much economic damage has been done. But as history shows, there's always opportunity during a downturn, and now is a great time to slow down and take a look at your products and processes to see where you can innovate. Clayton Christensen, the world's foremost authority on disruptive innovation, said, “Even the most successful organisations can find things they can improve on, and indeed, to avoid the innovator's dilemma, it's vital that successful businesses continue looking for ways they can improve.”
Now is a great time to challenge the way your business has done things in the past, and explore new ways of thinking that could perhaps lead to a new product line or an innovative business model.
Now is when you should be looking for new ways to use technology to your advantage. Can you save costs by closing an office and going remote? Which processes can you improve? Are there any resources you can consolidate? You may find that it takes only small improvements to make a big impact on your margins. By focusing your efforts on innovation now, you can chart a new path towards growth and ensure a head start over your competition, who may be just trying to survive.