How Covid has impacted innovation

Throughout the covid-19 response we have been highlighting and celebrating organisations that have “responded” and been creative to change their focus or adapt their approach. All of this has been hugely laudable.

Yet, as we start to imagine the future of work there is more and more evidence of the impact that Covid has had on workplace productivity and more importantly innovation.

We heard the CEO of Netflix very early on bemoaning the impact it was having on innovation in their organisation. At the time many rounded on him as being out of touch and not understanding the needs of his workers. He was followed by leaders at several other large organisations all stating that a return to in person working could not come quickly enough. Even the likes of Google have come back from their original statements that they would be fully flexible and did not expect any of their team to work in their offices going forward. They have now recognised the need for the hybrid model of working and will be wanting many of their team members to balance working remotely with working together in person.

Why the change?

As we have settled into the world of work with covid we are starting to recognise the costs. In a recent article from Harvard, they published research that indicated that whilst in some organisation’s productivity had increased, this was not the case across all business by any stretch of the imagination. In fact, the article stated that only those organisations who have prior to Covid operated in an innovative way, with effective virtual collaboration being a core part of their operating approach, only those business were seeing the uplift in genuine productivity.

In the main business are actually seeing a decline. 

There is lots of evidence that individuals in organisations are busier than ever. In the same article it was recognised that people were working on average 48.5 mins per day more than before covid. Yet, the evidence shows that the output from these additional minutes Is actually declining in most business.

The number of meetings has gone up by 12.9% and the number of people attending has also increased by 13.5%. The average length of meetings has declined yet the overall time spent in virtual meetings has grown significantly. We, it seems, are spending more time talking about doing work than actually doing work.

This has resulted in an actual decline in output of between 3 and 6%. This is largely due to inefficient collaboration, wasteful ways of working and a decline in engagement as people have a reduced sense of belonging due to being remote form their teammates.

The result is that we are seeing innovation decline. In a survey by McKinsey the focus on innovation had declined from 55% (pre-crisis) to a mere 23% during the crisis. As firms tried to cope with reacting to the pandemic they inevitably took their eye off the ball when it came to innovation and the results will hit hard in the next 12 months plus.

This removal of focus on innovation is particularly affecting the area of products and services. In 2019 56% of organisations rated their focus on product and service as being highly innovative. By 2020 this figure was down to just 40%.

The focus has shifted to workplace innovation – changing the way we set up and trying to adapt to a more distributed way of working. Whilst the lens has moved internally (95% saying there are focussed on innovating in this area) the question is what will this cost those organisations who are expending a lot of time and energy on this, at the expense of really finding new ways to delight and engage their customers?

The evidence shows that those who will thrive out of the back of the crisis are those who operate in an innovative way – those who had already worked out how to connect people together wherever and however they work for the principle focus on delivering outstanding experiences for their clients.

Stop trying to engineer complex policies on how we work and get back to focussing on WHY you do what you do, WHAT you can do better and HOW to improve the service you give your customers. 

If you think we can help your business and you would like to get a feel for who we are let’s have a chat.

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