One thing we journalists know, sometimes a colorful quote makes all the difference.
I've linked repeatedly to a post in which I shared Boston Consulting Group's advice that companies shouldn't neglect innovation activties during downturns, even though there's a great temptation to do so. Scaling back on such activities seems like a relatively painless way to cut costs. But when the economy bounces back, companies that cut too deeply risk losing market share to competitors that maintained innovation investments.
A post by Jeffrey Phillips on the Innovate on Purpose blog makes a similar point about innovating during a recession. But Phillips includes a killer quote from former Intel CEO Craig Barrett (which Phillips pulled from an article in the Oct. 3 edition of The Economist):
You can't save your way out of a recession; you have to invest your way out.
Phillips shares another insight from the article that echoes the advice offered by BCG: A down economy is a great time for companies to recruit and hire talent they might not otherwise be able to afford. DuPont's R&D investments and hiring during the Great Depression paid off in a relatively short time, notes Phillips, with new products rapidly accounting for 40 percent of the company's sales. He writes:
In this market, there are hundreds of people available with the skills you need to innovate and increase the pace of change in your company. Furthermore, if you aren't innovating during this period, you can bet that the folks who don't have jobs and don't see a future in a larger organization will create new, smaller companies to create new products and services aimed at some segment of your customers. So, you can choose to take on some of this talent and speed your own development, or watch as that talent forms new companies to compete with you.
For an interesting take on what can happen when companies can't or won't innovate, check out my post on Conde Nast's decision to ax several of its publications, including Gourmet magazine.