The current financial crisis is affecting virtually every organisation to some extent and as a result fewer investments are being made. Actually, cost efficiency is a term that we hear mentioned a lot lately. Therefore, people question whether innovation will be high on the agenda. I dare to argue that it should be, otherwise these organisations will fall behind. This blog post is the first of two about innovation in a time of recession, and specifically focusses on innovation and strategic agility.

Innovation and strategic agility
In a previous post on the Innovation Playground blog, the author states that the best investment you can make right now is to invest in the innovation capability of your organisation and reorganise to become an agile corporation. But what actually is strategic agility? On the website www.strategicagility.com the concept is defined as follows:

“The ability to continuously adjust and adapt strategic direction in core business, as a function of strategic ambitions and changing circumstances, and create not just new product and services, but also new business models and innovative ways to create value for a company.”

Strategic agility is already important in normal economic times, but even more so in difficult times. Because the environment changes quickly and organisations have to adjust to them. In times of high economic growth not much drive exists to change the organisation, but in difficult economic times one simply needs to change. Lower budgets make people more creative.

How to become more strategically agile?
According to the authors of the book Fast Strategy, three essential capabilities need to be in place to be strategically agile: strategic sensitivity (both the sharpness of perception and the intensity of awareness and attention), resource fluidity (the internal capability to reconfigure business systems and redeploy resources rapidly) and collective commitment (the ability of the top team to make bold decisions –fast, without being bogged in “win-lose” politics at the top). In the end, a lot of companies have overcapacity because of a shrinking production. Being agile involves resource fluidity: being able to put that overcapacity to use in a different way.

Act now!
This is the right time to use the overcapacity for innovation purposes. If you invest wisely to become more innovative and agile, your organisation will have a competitive advantage when the economy turns around.

The Canadian company Ecobee launched a thermostat that can be controlled trough the internet.

“The ecobee Smart Thermostat is a 7-day programmable thermostat designed to help you conserve energy, save money and reduce your environmental impact. The ecobee Smart Thermostat provides ease and flexibility in the management of your home environment and comfort.”

In itself the Ecobee isn’t a great example of ‘out off the box’ thinking, but is a nice SIT (Systematic Inventive Thinking) example. Specifically this is an example of the ‘dividing’ exercise where the functions of a product are split to see if they add value in that way. In this case the controls are taken of the thermostat and offered in a different way (the web). Another example of ‘dividing’ would be the remote control of televisions.

SIT is very powerful as it forces you to think in ways you are not used to leading to very creative ideas. The SIT workshops we run with our clients always lead to ideas that are pursued further. Give it a try!