What is the most positive and creative idea you’ve hatched during COVID-19 lockdown? Just take a few minutes to consider this – some of the biggest companies in the world were born during times of crisis. These companies include:
- Walt Disney Company during the US Great Depression
- FedEx during in response to the 1970 US Recession
- Microsoft during the 1973 oil shock and stock market crash
Most crises in history have overlapping similarities (e.g. economic recessions, lay offs), but each also comes with unique new normals, new needs, new ways to serve, and new ways to matter.
So, for the creative business owners and entrepreneurs out there, here are three unique and strategic reasons to innovate during COVID-19.
Reason 1: Fewer will blame you for an imperfect new product or service
Schools around the world are rolling out online classes for their students. Do all of these classes have perfectly designed online platforms, well-trained technical staff to support operations, or sufficient equipment to operate them? No. Most of them have to operate despite technical or engineering hiccups. Many are offered on Zoom, Skype, or WebEx without a good-looking website, sexy branded app, or even a proper technical support team. Some are delivered hastily on a trial basis, in ways that are not necessarily sustainable over the long run but crucial in the short run.
The Coronavirus allows for a level of trial-and-error and consumer tolerance that is highly unusual. This is one of the reasons great innovations have historically emerged out of times of crisis. A market in crisis is far less likely to complain about small glitches, cosmetic imperfections, or trivial inconveniences. Consumers in times of crisis are forced to ask themselves “what is the minimum I need” rather than “what is the maximum I want”. Consumer demand is down because of COVID-19, true. But so is the demand for perfection. And this poses a great opportunity to the new, small competitor.
There are sectors visibly well positioned for this historical trial-and- error opportunity, including – but not at all limited to – logistics and delivery, virtual and augmented reality, telecommunications, sanitation and hygiene, education, refrigeration and preserved foods, and loans and credit.
What does your industry look like? Do you have an idea that you have been trying to perfect before offering it on the market? Is it something that people need right now during the pandemic? Then do not wait for it to be perfect. Try launching it. The market will buy it if consumers really need it. And even if they do not, chances are they will not find fault with you or lose confidence in you for trying.
Is your idea or product something that people may need or want even (or especially) during COVID-19?
Do you have a product that WORKS, even if it’s not yet pretty or perfect? If not, could you get it to at least work?
Reason 2: The world is at a loss of what to do or expect
In situations where no one appears to have the right answer, a solution from even the smallest player is just as sought after as that from the biggest player. No solution will be discounted or written off merely on the grounds of your inexperience, precisely because the problem is something no one has experienced before.
Tata Consultancy Services Ltd (TCS), is the largest company in India by market capitalization. Today, TCS offers consulting services to some of the largest, multinational banks and conglomerates in over 40 countries around the world.
Its big, global break came when, in the years leading up to 2000, the world panicked in anticipation of Y2K. Also known as the Millennium Bug, Y2K was a world-wide scare caused by fear that, when December 31, 1999 ends and January 1, 2000 begins, most or all electrical devices or computer systems would crash that rely on microchips or databases that calculate years in two-digit formats (e.g. ’97, ’98, ’99) because systems would not recognize the year ’00. Companies and governments the world over had no idea what would happen when Y2K hit.
No solution will be discounted or written off merely on the grounds of your inexperience, precisely because the problem is something no one has experienced before.
The anxiety spread when it dawned on people that civilization and life as we knew it could quite literally end. There were computers in our cars, airplanes, and satellites. A large part of our power plants, government operating systems, militaries, banks, and hospitals depended on or were even automated by computers. Some even predicted that governments could cease to function, the world would go into an extended power blackout, the global economy would screech to a halt, and there may even be an end to law and order, plunging the world back into the Dark Ages. Some this must sound familiar to us today during the uncertainty surrounding COVID-19.
In response to a world that, much like today’s, was at a loss of what exactly to do or expect, TCS, at the time a much smaller, primarily local, family-owned business, designed and sold Y2K conversion software, supported by call centers equipped with whole armies of low-cost, English-speaking IT engineers. The world said yes. As a result, although Y2K did not cripple the world the way some had foretold, and although TCS’ Y2K conversion software became obsolete soon after, TCS led the subsequent, unstoppable upward march of India’s call-center and IT consulting industry. Since going public four years later in 2004, its stock price has appreciated to over 3,400% from ₹65.76 in August 1, 2004 to ₹2,232.66 in August 1, 2019.
For the innovative mind, it can be easier to start a business when no one has an answer than when everyone has an answer.
Before the lockdown, have you tried to sell something and failed because there were bigger or more experienced competitors that your customer preferred to buy from?
Is your product something that could be modified to address a real need people have during the pandemic?
Is there a specific group of people who know you, like you, or trust you to whom you could get your solution to before your larger competitor can?
Reason 3: The world is being forced to reexamine its very way of life
This Corona-freeze is perhaps the only instance in recent history, and probably for the foreseeable future, where such an incredibly large number of established norms are being reexamined the world over. As a result, questions that may have been brushed off as “out there” or ideas that may been discounted as strange or alternative in the past are now finding serious, open-minded listeners.
People who survive COVID-19 get to seriously challenge norms such as the five-day work week, the school-based education system, the value of commercial real estate, the definitions of full time and part-time employment, and many, many more. In other words, COVID-19 has taken away many of the tradition-based obstacles to innovation. If the excuse “This is how it’s always been done” meant anything before COVID-19, it is definitely obsolete now.
In the aftermath of COVID-19, as the “new normal” takes shape and sets in, there will likely be four kinds of people. These four cat egories are a modern adaptation to a similar break down provided by early 20th century British historian Arnold Toynbee who, in his enormously popular 12-volume series A Study of History, researched 23 world civilizations that rose or fell in the face of crises.
The categories are:
- Category 1 – The Stragglers: People who get left behind for adapting too little or too late
- Category 2 – The Followers: People who manage to adapt well
- Category 3 – The Opportunists: People who take advantage of it all by coming up with new products and ways to serve or add value
- Category 4 – The Leaders: People who define and lead the new normal
Category 1 (the Stragglers) may include some from the older demographic who are resistant to change and less tech-savvy. It will also be made up of people, regardless of age, who failed to pay attention to changing trends and needs.
However, most people will likely fall into Category 2 (the Followers). Adapting to the new normal will probably be easier than we expected. COVID-19’s effects will not all happen at once. The short-term changes (e.g. how we travel, how we work, how we socialize) may be quite immediate. But the biggest changes, changes that shift the world’s concentrations of power and definitions of value, will come like the tide – gradual, barely noticeable, but unstoppable. Yes, COVID-19 will change the world, but there will be time to adapt.
But for the entrepreneur and business owner, the hope is to fall into Category 3 (the Opportunists), and the absolute dream, no doubt, is to come under Category 4 (the Leaders). So what puts one in the latter and not the former? At first glance, it may be money and influence. And of course. How could you possibly be an industry leader in the new era if you did not have the financial or social capital beforehand?
But this begs the question of how financial and social capital is earned in the first place. They are earned through credibility. And credibility is earned through track record. Some in Category 3 (the Opportunists) may be able to pull off a one-hit product or service because of COVID-19, but he probably will not be able to get into Category 4 (the Leader) in an industry he was not already well recognized in.
There is a great lesson here for all of us; consistently build your credibility during times of normalcy by creating and adding value. Unless you were already known for something, you will probably not be successful in raising investment (financial capital) to expand on it during a global recession. Similarly, unless you already had a group of people who believed in your abilities in something, you will probably not be able to convince a strong network of people to support you (social capital) simply through Skype, Zoom, or email during the Corona lockdown.
That is not to say that Category 3 (the Opportunist) is not worthy of pursuit. Far from it. Every track record needs to start somewhere. The Amazons and Googles of today are only in Category 4 (the Leader) during this pandemic because they went through Category 3 some time in the past. Creating a Category 3 product or service during the Coronavirus pandemic may be what you need to do to establish your track record now, so that you can be a Category 4 business next time.
In a world that is reexamining its very way of life, entrepreneurs and business leaders should not be trying to “think outside the box”. The box has changed. They should instead be trying to urgently rethink the box and their new roles in it, starting from what they are intrinsically and prominently good at doing.
Have you had an idea that was dismissed or even ridiculed in the past? Is it an idea that may make sense now in the days of the pandemic if you, say, modified it just a little?
What strengths are you known for? What do people know that you are good at? Is your product something that reflects or is birthed from your known strengths?
Who are the people who know your strengths and believe in you? And what can you do for them that they need today during the pandemic?
“Originally published at our sister organization, www.africanbusiness.institute“
Jun ShiomitsuFounder & President at AVODA Group
Founder & President of AVODA Group. Prior to this, Jun was a banker for 13 years in Japan, the UK, and Switzerland, initially as the Assistant Vice President of the Treasury Department of Citibank Japan.