Restructure and reinvest in innovation
Issue 1, 2009
Strategy, Technology & innovation management

Innovation is traditionally one of the first casualties of a downturn. When companies are casting around for means to retain capital just to survive, spending on developments that may or may not pay off some time in the future is an easy target for cost-cutting. This article shows that the defensive response of killing or postponing R&D is the wrong way to deal with a downturn, and that a more forward-looking approach is to restructure R&D and reinvest accordingly. Through several best-practice examples, it shows how this approach enables companies to both optimise their shortterm financial performance and strengthen their ability to compete when the upturn finally comes.