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Help Wanted: Innovators to Pull Us Out of this Recession

I am a firm believer in the power of innovation and have been waiting for something to wow us out this economic recession.  Unfortunately, I came to a pretty sad realization today and am afraid that we are stuck in a viscous cycle that may not end anytime soon.  Now that you are either scared or think I am a lunatic, here is why.

Small businesses no longer have the capital to innovate and are too busy figuring out how to survive.  They are cutting expenses daily and trying to operate with less in the bank.  Although banks are “turning profits”(I put that in quotes because I don’t believe them), there aren’t many new loans being given.  Honestly, small businesses aren’t even looking for the money because who knows when they’ll be able to pay it back.  

Large corporate businesses aren’t innovating either.  They are looking at this economy as a time to squash the competition and gain a larger portion of the market share.  From a business point of view, if I were the CEO, that is exactly what I would do.  It makes sense to spend money to beat the competition while they are hurting, this way when things turn around revenue will increase exponentially.  

From a consumer’s point of view and the idealist in me, I want large corporations to spend money on research and development.  If one new sensational product came out this year from a proven corporation, spirits could be lifted and new cash would be infused into the economy.  This would start a chain reaction and help lift the global economy.  

Am I asking too much?

 
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2 Responses

  1. Flavio

    This is my 28th year in a ridiculous country like Argentina. I must say that surviving under (multiple) exceptional crisis also requires creativity and innovation. Frankly, I believe the standardized way of understanding a company (to me it resembles a fast-food restaurant in some cases) is making American companies lag. When I was 20, I worked at a state-run nuclear laboratory and it was crazy how they did so much with nothing. Some of these scientists left for other institutions abroad and I heard interesting things– and I am glad for them and for everybody. Even if they were very smart and creative, they must do better at more modern, better-stocked labs.

    Hopefully the crisis will force these companies to face their challenges differently. Think about it– this might be their only chance to rip bureaucracy and reset their priorities. Take a look at the automobile industry. The idea of both GM and Chrysler going bankrupt is just ludicrous. Isn’t the US the biggest market for cars in the world? One would expect domestic players to know their clients’ taste and needs best, have the most expertise in logistics, reach the most agreements with partner companies. Maybe even have their lobbyists convince the government it’s only for their worker’s sake that they require unfair advantages. I have the feeling that in the past it was easy to cover mistakes by just pouring in more money.
    So this is quite an extraordinary situation. American companies have a good record in innovation, but resources and financing is something they barely ever lacked. Hopefully, not only the strongest but the smartest players should survive. And once the economy is back on track, it should make the difference.

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