Thursday, August 6, 2009

It is still not too late to innovate

At the Product Development and Management Association (PDMA) breakfast meeting this morning we talked about how this recession might impact how we measure R&D investments.

One of the attendees pointed out that we pull out of a recession when innovative new products incite people to start buying again. The impact on companies is that if you are not coming to market with innovative products soon, you may be bypassed by new competitors as we go into recovery.

Research suggests that in prior recessions the vast majority of companies who fail to prepare innovations during the latter part of the recession, disappear within a few years of the recovery. Their products lose their ability to attract customers and market share disappears.

But this recession is a little different from prior recessions. Because banks are the cause of the recession, the breadth of this recession is unusually broad. Job creation is what economists tell us will pull us out of this recession.

That could cause the innovation bubble to be pushed further into the future. It will still happen, but perhaps later than in prior recoveries.
That is good news for companies who’ve done nothing but hunker-down over the past few months. There is still time to get organized to innovate.
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