Innovation management in times of economic crisis

Abstract

Economic downturns are the least desirable but still inevitable conditions, which bring along many negative consequences on the living standard of citizens and business survival, development, further growth, and profitability. In such circumstances of economic crises, managers turn to the so-called quick reactive strategies aimed at retaining previous profit levels, in an attempt to protect their business from the downfall - thus securing its survival. However, it is determined that in a time of economic crisis, innovation management in most cases suffers the most. It becomes a neglected field of management, left for better economic conditions. Nevertheless, the question is whether managers in periods of economic downturns should neglect investing in innovations and how they should approach the innovation management field. In this paper, strategic implications of innovation management in the time of economic crisis are presented. In the first part of the paper the usual managers’ behavior related to conducting business in times of economic crisis is described. In the second part of the paper proposals are given with regard to whether and how managers should implement innovation management strategies, in order to set up a strong base and precondition for future business growth, after the crisis is over, but also during the crisis itself.