“It’s an environment the likes of which managers have never seen—a Great Disruption in which the old rules for success become recipes for failure, and ‘doing more with less’ will not be nearly enough to survive.”—Scott D. Anthony, The Silver Lining: An Innovation Playbook for Uncertain Times, Harvard Business Press, 2009
The inevitable constraints this tough economy imposes on companies provide fertile ground for innovation because necessity truly is the mother of invention. Companies that learn to innovate more quickly, cheaply and with less risk will emerge from the downturn stronger than ever.
To succeed, smart executives will need to adopt a different mindset and effective frameworks to determine what to start doing, stop doing and do differently. Consultant and author Scott D. Anthony, who earned his MBA at Harvard Business School, prescribes a disruptive-innovation mindset. His book is well-worth the read for historical perspectives and inspiration.
Over the last decade, technological improvements have made starting and scaling businesses easier than ever. Brazil, Russia, China, India and other emerging markets prove U.S. leaders have more competitors at home and abroad. Industries are frantically converging and colliding.
These changes make it more difficult for great companies to maintain success—a problem that has caused leaders to lose sleep for some time (even before the 2008 financial market collapse).
Tough business environments force companies to take a hard look at innovation. While output may shrink and unemployment is sure to rise, companies that master these challenges have a chance to thrive. Those that don’t are sure to struggle.
A Historical Perspective
While no one can predict with certainty how the global economic crisis will play out, many companies face serious challenges:
- Should they cut costs and streamline innovation projects until business picks up?
- Should they play it safe until the current storm passes?
If history is a guide, the answer is a definitive “no.” We can restore hope and gain a better perspective by taking a step back and considering how past downturns were resolved.
Many successful companies have been launched during recessions. Grim economic times can highlight previously hidden problems or cause old problems to intensify. When a deep-seated customer problem emerges, search for novel ways to address it.
A number of game-changing products, services and business-model innovations were developed or launched in daunting economic climates.
Thirteen of the 25 companies on the Dow Jones Industrial Average, as of December 2008, were formed during an economic downturn, including 3M, General Electric, Microsoft and Walt Disney.
Instead of trying to best their competitors, disruptors change the game. They typically transform existing markets or create new ones by focusing on convenience, simplicity, accessibility or affordability.
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The complete 2,000 word article includes these important concepts:
- A Historical Perspective
- Disruptive Innovations
- Bad Times, Good Times
- The Transformation Imperative
- Disruptive Guidelines
- The Executive Challenge
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