Lately, when you get to the finance segment of news reports, you are more likely to hear that the markets are down, rather than up. Just in the last week, the OECD downgraded global growth forecasts, and in response, economists have been issuing dire warnings of a coming low growth, low return world.
These are economically pessimistic times. But for all the dire predictions and negative trends I believe the commentary is missing the opportunity that these economic could conditions also represent. Because historically speaking, it’s in times of the greatest economic need, that the greatest innovation has been fostered.
"It’s in times of the greatest economic need, that the greatest innovation has been fostered"
In the Great Depression of the late 1920s and 1930s, it was investment in military infrastructure and innovation that brought an end to the dire financial conditions, making it “the most technologically progressive decade of the 20th century”. During the commodities recession, and after the 1987 stockmarket crash, it was investment in internet technologies that fueled establishment and growth of businesses that now dominate our information and communications technology industries. And right now, investment in new forms of creative business processes and services that has the potential to inspire growth over the next decade.
So if it makes sense to invest in innovation for growth, it logically follows that we need to inspire innovation through encouraging creativity. And it turns out, we’re actually living through a highly creative period, too.
As the media landscape has diversified, there have emerged more opportunities for individuals and organizations to communicate, as well as to share and to create content. Over 500 million tweets are being posted to Twitter every day. 60 hours of video content is being uploaded to YouTube every minute. More than 140,000 photos will be posted to Instagram, and a whopping 140 billion emails will be sent today. As humans, we have an ever-growing array of channels through which we can publish, consume and share ideas.
And while all this creative content development is going on, the data around these practices and channels of communication is growing ever more sophisticated, and there are emerging opportunities for improving understanding about market needs, social trends, stock availability, production efficiencies and so on. We have an extraordinary amount of data available to us, and mapping that data allows us to identify opportunities for process improvement.
"The ingredients for innovation are proliferating daily"
And with tools like lean canvas development, agile innovation management and design thinking to shape change, the basic innovation process execution resources are also widely available and understood.
So if the mix of creativity, data insights and innovation facilitation is all there, what’s holding wide scale innovation back? And why are commentators warning of a low growth and low return world?
At least part of the problem appears to be resistance to change. The great theorist of entrepreneurship, Joseph Schumpeter once said that conspicuous progress comes from organizations that invest in continuous innovation, a process he called ‘creative destruction’. It can be tempting for organizations to look at the news reports of a global economic slowdown, and think that the best way to ride out the storm is to stifle innovation, and to focus on core business activities, without embracing change. But this is a dangerous strategy. While new firms are being established every day that can shape the future of business and drive growth, companies that adhere to old business processes risk being innovated out of business.
Innovation is the key to growth in a period of global economic stagnation.
Failure to innovate may well be the barrier to getting global growth back on track.
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