Innovation Management in Times of Economic Crisis

Abstract

Since the last quarter of 2008, countries all around the world have been facing a deep economic crisis and the changes therewith connected, and it has been estimated that crisis repercussions will be in effect until 2014, or even longer in certain industries. The industries in general have been weakened and shaken, unemployment has risen, and investments crucial for innovations and future growth are under risk. In many countries, governments have endorsed expenditure of billions of dollars for the purpose of founding stimulating funds, but the hard work of rebuilding of the damaged economies has just begun. The primary task of managers is to enforce various business decisions, mainly cost-inspired, in order to keep their organizations afloat, but they seem unaware of the fact that the key to return to long-term growth under these conditions is precisely the human capacity to innovate. By rational investments, national governments can slow down the economic downfall, speed up economic recovery and place a foundation for a strong and sustainable growth. However, most managers seem not to understand the possibility to use that basis in an efficient way, but only through innovation. This paper describes the process of innovation management in times of economic downturn, with the accent on its strategic implications to companies’ business. We present the usual managerial behavior in a time of economic crisis, but also give recommendations for fruitful business behavior during such times.