Covid disruption is breeding innovation

Covid disruption is breeding innovation

If asked to encapsulate the coronavirus crisis in a single word, ‘disruptive’ might be the most appropriate choice.

The outbreak has impacted the life of everybody on earth, changing how we work, exercise, socialise, shop, manage our health, educate our children and take care of our families. Few events in human history can lay claim to such disruptive potential.

The question is: how do we respond to such unprecedented disruption? Do we put our lives on hold, wait out the storm and hope to return to normality once the disruption subsides?

Or do we adapt, innovate and find new ways new of tackling the situation at hand? Herein lies the paradox of disruption. In order to conquer disruption, we must be disruptive.

Key Points

  • Disruption has a lot of currency right now
  • Many more people are working from home
  • Play at home has also become a significant issue

In the world of business, disruptive companies are those that are able to innovate and create new markets that challenge existing business models.

These qualities are now more important than ever, and a handful of companies and sectors are beginning to show their disruptive mettle by responding to challenges thrown up by the crisis in new, highly creative ways.

Technology gain

The first place to look for such disruption is in the digital economy, which, during the crisis, has been shaped by one trend in particular: working from home.

Over the course of the pandemic, the UK, for instance, has seen a 10-fold increase in the number of people working from home, and those companies able to adapt and shape new patterns of consumption are winning out.

Zoom is perhaps the most well-known success story. Overnight, Zoom became the go-to video communication platform for millions of new ‘everyday’ users, including school and college students, church and concertgoers, and families and friends looking to connect while subject to social distancing measures.

Its year-to-date share price has doubled as a result.

Companies are also doubling down on the use of video communication software, compounding growth in this market. Alongside Zoom, platforms such as Microsoft Teams, Google Hangouts, and Skype and Cisco Web-ex seem to be the preferred choice of video conference platform for many companies.

Microsoft’s Teams platform with multi-application integration has been the standout performer here, gaining more than 12m daily users in a week, representing a jump of 37.5 per cent.

But video communication companies are not the only ones to benefit.

The cybersecurity market has grown significantly amid a more rapid migration to digital networks as brought about by WFH, with the Cloud’s share of security budgets expected to rise from 28 per cent in 2019 to 38 per cent on average in 2020.

CrowdStrike is one of the best recent performers, posting a 60 per cent share price rise over a matter of days.

The company has taken a fundamentally new approach to cybersecurity that leverages the network effect of crowdsourced data applied to modern security through technologies such as artificial intelligence, Cloud computing, and graph databases.