As companies remerge from the pandemic, controlling costs is the new priority. As a result, the cost of innovation is being watched closer than ever.
Innovation may have been the most overhyped buzzword in the business world for the past decade. Innovation Labs. Innovation Hubs. Chief Innovation Officers. Until recently, companies were “all in” on innovation at almost any cost. Innovation provided the foundation for success in the corporate world and served as the baseline for measuring digital transformation initiatives.
The irony is, even during the best of times with seemingly unlimited budgets, companies struggled to transform themselves digitally. According to a recent study by McKinsey, 84% of respondents say their organizations’ digital transformations have failed to improve performance or equipped them to sustain changes in the long term.
In the new normal, these types of metrics aren’t just unsustainable; they are unacceptable. How and on what enterprises spend money will be closely monitored. Innovation can’t end, but budgets allocated to innovation will be closely monitored.
Most digital transformation projects planned at the start of 2020 have been dramatically overhauled, if not altogether scrapped. Earlier priorities are a distant memory, and new priorities have emerged. As companies remerge after being shut down from normal operations as a result of COVID-19, controlling costs is the new priority.