7 Corporate Innovation Challenges to Tackle in the New Normal.

Challenge 1: An uncertain landscape.

The context.

Recent shifts in the economy and customer demand can have a detrimental effect on stakeholder interest, employee motivation, and any type of long-term planning.

In the midst of it all, only one thing is really certain:

Your pre-pandemic business plan will no longer be adequate to navigate the uncharted waters ahead.

Areas of opportunity.

Some of the most impactful paradigm shifts, business trends, and investment opportunities have been the direct result of some sort of uncertainty (e.g. wars, recessions, disruptions, etc.). It’s a tale as old as time.

The current pandemic can be just the push you need to discover leaner and more effective strategies for your business. If you play your cards right, you might even end up building a stronger and more resilient company than before. Don’t believe me?

Here are two examples of companies that have thrived during times of uncertainty:

General motors

In the 2000s, GM had to be bailed out by the federal government. They cut costs, innovated, and got rid of their less profitable divisions (e.g. Hummer, Saturn). The result? By 2019 they were making revenues of $137.2 bn. Nice comeback!  

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Apple

After years of weak sales, Apple was on the brink of bankruptcy in 1997. That’s when they started designing stylish gadgets like the iPod. The rest is history.

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How to tackle the challenge.

The best remedy against uncertainty is to gather as much information as possible. Here are just a few examples of things you can do to diminish uncertainty:

• Use Smoke Testing to validate new products or services before investing in them.
• Use Design Sprints to help kick-start a new innovation strategy.
• Re-examine and update your customer journey.
• Incorporate a startup mentality to stay lean and competitive.

Stay up to date with the latest consumer trends that affect your business.

Challenge 2: Exploring alternative channels.

The context.

Many companies are experimenting with new digital schemas to achieve everyday tasks (e.g. sales visits, team sprints, facility tours, etc.).  

This trend will most likely continue even after the lockdown is over, affecting service channels, customer relationships, sales, and marketing (to name a few).

Areas of opportunity.

It’s the perfect time to explore channels that are better suited to where we are today. Making the shift to more remote channels can help companies:

• Reach a wider set of customers, partners, and suppliers.
• Save time and resources.
• Re-imagine your customer journey through remote services.
• Establish a deeper customer relationship with a more direct-to-consumer (D2C) strategy.
• Achieve higher resource efficiency through centralization (because more things can be done from headquarters).

How to tackle the challenge.

Start adopting a mindset that is more aligned with the “new normal” e.g.:

• More people will be working from home.
• More processes will be automated.
• More people will be getting their products and services digitally.
• Collaborative technology will become vital.

There are a myriad of tools available to help you stay connected at a distance, including Slack, Zoom, Notion, and Miro among others.

Challenge 3: A need for localized partnerships.

The context.

The global economy has led many businesses to establish foreign partnerships, resulting in complex supply chains.

Although this model has worked well in the past, the pandemic has caused more than a few disruptions, preventing products from getting to their final location. The resulting strain has many companies re-thinking their global supply chains, in favor of local ones.

Areas of opportunity.

Establishing more localized partnerships can be quite a challenge in itself, but the potential return on investment makes it well worth the effort.

Here are just a few opportunities to consider:

• Expanding your services while keeping your core offering intact
• Corporate venturing is a great way to accomplish this goal.
• Solving your customer problems quicker and more efficiently.
• Using local staff, partners, and services enables users to have more control over the overall quality of their offering.
• It also speeds up the supply chain enabling you to meet client demands more efficiently.
• Using drones, robotics, and AI to automate your supply chain.  

How to tackle the challenge.

Start off small, testing out pilot projects with different partners. Once you’ve found a formula that works, you can start scaling to include broader sections of your business.

Challenge 4: Adapting to the new landscape.

The context.

Although some industries have boomed since the pandemic (e.g. e-commerce, digital learning, fitness, gaming, social media, etc.), many have had to cut their losses (e.g. travel, restaurants, sports, theme parks).

Companies have already started taking steps to seek out new ways to thrive in the post-covid landscape.  

Areas of opportunity.

Here are just a few examples of how businesses can successfully adapt to the new landscape:

• Sell the same product, but explore new channels
• Products can be adapted digitally
• Services can be delivered using advanced tech-solutions
• Use the same infrastructure, to create new products
• Use your current infrastructure to produce new offerings
• Sell the same product, using an expanded infrastructure
• Focus on the areas of your business that are in highest demand
• Expand on the infrastructure that supports those areas

How to tackle the challenge.

Like most fundamental business changes, it’s best to start off small and test things as you go. Experiment with new offerings, establish new partnerships, and try out different ways to use your infrastructure.

Here are just a few examples of companies that have successfully used these strategies:

• Nike is a great example of how companies can sell the same product using new channels. When the pandemic hit in China, the company started connecting with customers digitally by offering their work-out app, Nike Training Club, for free. The result? A 35% increase in online sales between December of 2019 and February of 2020.  
• When it comes to using the same infrastructure to create new products, Netflix takes the cake with its new offering Netflix Party. The new service enables users to watch their favorite shows and movies in a synchronized manner with friends and family around the world. It also has a group chat options so you can make comments in real-time.
• Lastly, as an example of a company that is expanding its infrastructure to meet new customer demand we have Amazon. To meet their recent increase in online shoppers, the company is hiring an additional 100,000 workers. They also established a partnership with Lyft to help meet the demand for deliveries.

Challenge 5: Creating a scalable talent ecosystem.

The context.

The pandemic has resulted in a slew of companies having to make drastic staffing changes:

• Hertz announced that it plans to lay off 10,000 employees.
• TripAdvisor announced it was laying off more than 900 employees.
• Sephora laid off over 3,000 part-time and seasonal employees.
• Walmart plans to hire 150,000 temporary workers by the end of May.
• CVS plans to hire 50,000 employees to meet demand.

The uncertain landscape is shedding light on the importance of creating a scalable talent ecosystem (i.e. a flexible workforce that can more easily adapt to the needs of your business).

Areas of opportunity.

Establishing a more scalable workforce can make it easier to adapt quickly during times of increased demand or economic difficulty.

The gig economy has been here for a while, offering companies an endless amount of options in terms of flexible, seasonal, and freelance workers. All you have to do is hop on to your favorite online platform and look for the talent you need  (e.g. Upwork, Top Total, You Team, Workhoppers, etc.).

Having this additional resource can help you better prepare for the next big economic fluctuation.  

How to tackle the challenge.

Explore your options in terms of outsourcing, platforms, and freelancers that can help you build a more flexible workforce. Once you established the necessary relationships and schemas, it will be much easier to scale your resources up or down depending on your needs.

Challenge 6: Planning for the long-term.

The context.

Recent economic changes and consumer behavior shifts have rendered most of our pre-corona forecasts and projections moot. The largely uncharted economic environment ahead has a lot of elements that have yet to be revealed.

This has made long-term planning more of a challenge than usual.

Areas of opportunity.

Having a more innovative and long-term focus can help companies get ahead of the startup game and become a disruptor rather than be disrupted.  

How to tackle the challenge.

Here are just a few ways you can ensure your company has an effective long-term strategy:

• Set up your own corporate incubator to stimulate innovation and develop a pipeline of successful new ventures.
• Set up one or more internal innovation squads. This is more effective than having a few “innovation managers” working separately in different departments.
• Innovation is not a part-time gig. Make sure your teams can dedicate 100% of their time, creativity, and resources to future-proofing your business.
• Incentivize your team to share and develop winning ideas, and establish the right rewards programs to keep them motivated.

For more details on setting up the right long-term strategy, check out our article: “How to Get Your Company Ahead of the Startup Game”.

Challenge 7: Corporate hierarchy chains.

The context.

Corporate hierarchy chains tend to slow the innovation process, bringing it down to an almost glacial pace. It’s one of the reasons startups end up beating them the punch when it comes to innovation.

The recent lockdown has put a spotlight on these inefficiencies, showing that a lot of the things that were slowing us down, weren’t as critical as we thought.

Areas of opportunity.

Corporations have the know-how, talent, funds, channels, and even the customers needed to bring an idea to market at lightning speed.

All they need is the right mindset and a structure to put their resources into action.

How to tackle the challenge.

Corporate bureaucracy is real. We’ve all felt it at one point or another through excessive planning, paperwork, reports, meetings, and training sessions. It’s just the way things are.

With that in mind, here are a few tips to help you keep things moving forward:

• Make sure your team has an open platform to voice and develop new ideas.
• Digitize the process as much as possible (e.g. online forms, responses, and approvals).
• Create a culture of action within your team. Getting all the tedious pre-steps out of the way is just part of the challenge.
• Hire people that know how to get things done within the corporate environment. It’s all part of being an intrapreneur.

As a corporate innovation manager, it is key that you stay focused on your long-term goals and accept the fact that you’ll have to jump through a few hoops to get there. No pain, no gain right?

Final thoughts

Mark Twain once said: “Whenever you find yourself on the side of the majority, stop and reflect.” That’s a pretty good guideline when it comes to making change within a corporation.

Being a true innovator is hard, especially in today’s uncertain corporate landscape. There are no instruction manuals, magic formulas, or shortcuts that guarantee you a stellar result. In fact, you’ll probably have to try a few times before successfully overcoming some of the challenges described in this article. But what’s life without a little turmoil?

Despite the challenges, it’s a pretty exciting time to be a corporate innovator. The advances we’ve made in AI, robotics, digital services, and automation have given us more options than ever, right at our fingertips.

What’s more, the pandemic has shed light on how important innovation actually is within corporations, opening more minds to the possibility of new ventures and experimenting with new technologies.

As intrapreneurs, perhaps our biggest challenge will be to use the resources we have to build something great.

We can help you use venture strategy to beat the challenges facing corporations today.

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