Adapting to a New Innovation Reality: Trends, Technologies, Prospects
Adapting to a New Innovation Reality: Trends, Technologies, Prospects is an analytical report by GenerationS. The paper examines the current global situation and its impact on companies’ attempts to innovate, both in Russia, and worldwide. It looks at methods employed by major Russian and international companies to adapt their innovation processes during a pandemic. There is also an overview of various technologies and solutions which can be employed to ensure business efficiency in the current environment.
Analysts from the Roscongress Foundation have identified the main points made by the paper. For each one, a relevant video excerpt of a panel discussion held at one of the Foundation’s main events has been added.
The COVID-19 pandemic has led to the biggest economic downturn since the Great Depression.
According to the International Monetary Fund, the global economy is currently experiencing its biggest downturn since the Great Depression. What’s more, for the first time since that era, negative growth is forecast for developed economies (-6.1%) as well as emerging economies and developing nations (-1% and −2.2%, excluding China). Per capita income is expected to fall in more than 170 countries, with cumulative losses in global GDP of around USD 9 trillion for 2020 and 2021.
If the adopted measures are effective at halting the pandemic in the second half of 2020, developed economies, emerging economies, and developing nations will only get to see partial recovery in 2021.
The negative impact of COVID-19 has been most keenly felt in, amongst others, the oil and gas industry, aviation, and tourism. Entrepreneurs and corporations have suffered first and foremost from the closure of national borders and the implementation of self-isolation regulations. However, there are industries which have experienced growth during the pandemic, such as e-commerce.
The industries which have suffered the most during the COVID-19 pandemic are the oil and gas industry, aviation, tourism, manufacturing, construction and real estate, banking, retail, and hospitality.
The negative effect has been compounded by the essential measures put in place to control the spread of the disease. These include the closure of national borders, the implementation of self-isolation regulations, and the need to temporarily shut down manufacturing sites and enterprises due to social distancing rules. There has been a sharp drop in demand for products and services as a result.
However, there are industries which have experienced growth during the pandemic, most notably e-commerce, entertainment, and healthcare. This has not only been down to situational factors causing an increase in demand for certain types of goods and services, but also the ability of corporations to quickly and efficiently adapt their key processes in line with the new reality. This includes digitalizing operations to the point where they can move online en masse, adapting products or services to the changing needs of customers and users, and ensuring the seamless operation of supply chains.
Virtually all sectors have experienced a negative effect on their operational processes, with e‑commerce the only exception. Despite the evident downturn across industries, there are corporations which are withstanding the crisis better than others. This has been due to their ability to react and adapt rapidly to changing circumstances. These companies have also implemented the technology needed to ensure uninterrupted operation at a time of enforced social distancing.
The current situation is a contributing factor to new consumer behaviour patterns, which in all likelihood, will continue after the crisis is over.
For many corporations, this means they will have to review how they interact with their customers, and assess the use of digital channels in order to ensure higher levels of customer satisfaction.
The ability to reconfigure channels used by corporations to interact with end users and customers is essential to maintain income from buyers. It also helps attract new customers and in turn, guarantee the stable functioning of the corporation.
In the current environment, identifying new customer interaction channels is essential for banks, insurance companies, retail companies, the hospitality industry, and the tourist sector.
Ensuring seamless production and logistical processes is also key. Companies need to deliver goods and services quickly, securely, and reliably. This is particularly the case for customers who are at increased risk from COVID-19, and those at the front line in the battle against the disease, such as companies working to develop tests and treatments.
Measures to reduce costs and implement technology aimed at rapidly adapting production processes are serving as the main driver of innovation during the COVID-19 pandemic.
It is crucial to appreciate that in the current environment, all factors hindering the development of innovation — budget, processes, talent — have only intensified, and have become a real impediment for corporations looking to implement innovative processes. Corporate innovators are struggling with the fact that all new projects have been shelved. However, the current situation has also meant that corporations which already have innovative processes and infrastructures in place are only accelerating the launch of pilot projects aimed at improving stability, transparency, and operating efficiency.
COVID-19 has already demonstrated to the world that people are able to come together in a common cause — to defeat the disease and mitigate its negative effects. The same is true of corporations. Employees can see how digital transformation and innovation are enabling them to rapidly adapt to new circumstances, stay afloat, and continue to successfully do business. This in turn increases their own involvement in innovative processes. For a long time now, the need for and importance of digital transformation has not been in dispute.
Technology is becoming the main driver for companies to operate and adapt in the current environment. The range of solutions currently under development is vast. Nevertheless, it is possible to identify five key areas:
- autonomous things;
- tracking and tracing;
- online engagement and entertainment;
Adapting to a New Innovation Reality: Trends, Technologies, Prospects uses case studies and examples to demonstrate that the flexibility of innovative processes not only enables companies to rapidly adapt to the current situation, but also significantly improve performance. The development and implementation of the most effective solutions allows companies to not just operate normally, but, in many instances, more efficiently and productively.