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Three Recession Scenarios, and How to Survive Them

January 16, 2020
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It’s never fun to live through a recession. For innovation groups, it can be a dangerous time. Yet, our innovation skills and agility should help us not just survive but thrive in difficult and uncertain times. Here are three recession scenarios that may hit your innovation group, and some thoughts on how to turns lemons into innovation lemonade.

Nancy Tennant. Illustration by Todd Detwiler for InnoLead.

Funding Cuts

To prepare for this inevitable setback, start now by seeing innovation work as an intellectual asset, and managing it accordingly. Consider each innovation project that fails as a “shelved” project. Strive to ensure that the learnings or findings from shelved projects are searchable and reusable. This takes some discipline. You don’t move on to the next innovation until you have archived the key learnings from the last. Then, when the recession hits, explore your shelved inventory and repurpose findings to help with low cost and fast innovations. Innovations can fail because the idea was ahead of its time; because it needs to be merged with contemporary findings; or because it needs to be part of a new partnership in your ecosystem. Dust them off and see where they can lead.

Turning a shelved idea into a launched innovation happened in a company I worked with, and it paid off. The shelved innovation was a kitchen composter. Innovators created it before the 2007 recession, and we learned the world was not ready for it. The green movement was just not in full sight of many consumers, so we shelved it. During the recession, our funding dried up, so we took the kitchen composter off the shelf and started to refresh it, using little to no funding to get it to the next level. We worked it until we were out of the recession and could put in it our innovation pipeline. The product was launched a few years ago to great acclaim.

Be Like Water

Innovation tools are problem-solving tools, and they can be paired with continuous improvement tools to support cost-cutting. If your organization moves into a cost-cutting mode, repurpose and offer your innovation toolbox to keep your group relevant, and help your company survive. One way is to find the Six Sigma/lean team and work together to help the organization save money. In a recession, you want to be like water, and fluidly adjust your practice to address the extreme organization needs that occur in recession, while preparing your innovation group for the upturn.

Innovation Projects Stopped/Slowed

If you find yourselves in a slowdown, here are some low-cost things you can do to survive the recession and get ready for an eventual return to growth.

  • Create your next two-to-five year (post-recession) innovation strategy.
  • Consider creating the content for low-cost foundational e-training on innovation. Write the scripts, create the materials, and then either hold it until you get new funding, or find the most cost-effective way to host it. With a small amount of funding, you can offer these online coursse to all employees as a bridge until you can start innovation work again.
  • Communicate past or in-process innovations so employees can see innovation happening amidst the internal company news cycle that will no doubt be dominated by gloom-and-doom. Innovation can be a beacon of hope in difficult times.
  • Form networks with other companies enduring the recession and share ideas, mentorship, and lessons of experience.
  • Work on management systems that you have not had time to address. In one recession, our innovation group put the process in place for innovators to create new kinds of ecosystems, once the recession ended.
  • Write an article or blog post to keep your organization in the innovation headlines.

The trick for innovation groups in a recession is to stay in the game by not getting the “vote of no confidence” from top leadership when everything is getting squeezed. Be adaptive and help your organization through difficult times. Think of what you can do that is low-cost to keep the innovation fires burning until you are fully funded again. Most importantly, understand that the recession will eventually end. When it does, make sure your innovation group is ready for the upturn.

 

Nancy Tennant worked for the appliance giant Whirlpool Corp. for nearly three decades, serving as the company’s first Chief Innovation Officer. She is an adjunct professor at University of Chicago and the University of Notre Dame, and the author of several books, including  Transform Your Company for the Innovation Universe.

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