The New York Times has a piece on innovation during recessions. The gist of the article is that business leaders are often tempted to cut innovation, particularly in bad economic climates. Managers see the short-term costs of innovation, while the long-term benefits (in terms of new revenue streams, new products, new practices, new customers, etc.) are uncertain. As a result, when managers tighten their belts, innovation is often the first thing to go.
But cutting back doesn’t have to mean a wholesale rejection of innovation. Rather, by embedding innovation throughout the organization, short-term necessities can be balanced against long-term goals. Call it the Goldilocks Principle applied to innovation. And in some cases, tough times can actually spur innovation by forcing managers to re-examine their own assumptions. The companies that get it right will be well-positioned for success and growth once the economy recovers.