The ongoing COVID-19 pandemic will eventually come to an end, but not before it’s given rise to the creation of new digital products, services, and businesses (collectively known as digital innovation).
These new digital innovations are inevitable because the current landscape demands them (and because organizational innovation is critical to organizational success and survival). For example, McKinsey’s recent consumer-sentiment surveys show just how much this crisis has changed commerce so far. Across the globe, consumers shop online at home and develop new habits that prompt digital innovation.
Of course, the huge number of people working from home and the abrupt shift to remote work also underscore the fact that our digital infrastructure is now just as vital as our physical one. Entrepreneurs are eager to tap into the new demands of enterprises, and we’ll soon see a new wave of B2B digital innovations offering products and services that help facilitate remote work, make distributed teams more effective, and streamline asynchronous communications.
Unsurprisingly, these realities make today’s digital startups and innovators likely targets for investors in the near future. But if you’re an entrepreneur looking to gain capital from investors for building the next Zoom or Slack, you should know that your company will have to overcome one massive challenge: security and privacy.
Digital Innovations Are Evolving
Digital innovation will be crucial for enabling businesses to survive during and after this difficult time. However, privacy regulations advanced significantly at the end of the past decade. Europe’s General Data Protection Regulation, the California Consumer Privacy Act, and similar local and regional mandates enabled legislators to help alleviate security and privacy concerns. The momentum on that front isn’t slowing, so digital innovations will need to adhere to new sets of rules and standards in a post-pandemic world.
Already, companies that were positioned well during COVID-19 needed to overcome significant hurdles to keep the world working effectively while remote. Zoom, a popular video conferencing tool, has been challenged by security issues thanks to an explosion of new users. Microsoft Azure, a cloud computing service, suffered from strained datacenter capacity in Europe. And all over the globe, apps are crashing, employee privacy is being unintentionally violated, and proprietary information is being unintentionally leaked.
As an entrepreneur, you should be asking yourself an important question: How do you balance your digital innovations with the new public awareness of security and privacy concerns? Digital innovation is inherently risky, so you’ll want to evaluate these two possible approaches:
1. Start with innovation and a clean slate.
When designing products and solutions, entrepreneurs who take this approach ask, “What could be done if we set aside all constraints, including security and privacy concerns?” You can use the clean-slate method to generate big ideas. However, if your goal is purely innovation and there are no further considerations, then the resulting product or solution will be developed with no regard for compliance, regulations, privacy, or security. This approach can be quite hazardous because it fails to account for and mitigate possible risks. You may want to consider what level of risk is tolerable in the arena the innovation is in. Do an analysis of value versus costs to determine the appetite for risk and adjust your approach accordingly.
2. Start with existing security and privacy guidelines in mind.
Coming up with a viable business idea necessitates consideration for things like budgets, time horizons, resources, and security and privacy. Innovating within existing constraints might seem like a backward approach, but some of the most creative solutions arise in spite of—or possibly as a result of—seemingly impossible limitations. While this method might not seem the most groundbreaking, adopting it will improve your chances of developing a solution that holds up under pressure. This approach considers security from the beginning, so it will improve your chances of securing funding from investors whose appetite for risk has been dampened significantly by the current crisis. Modern software design principles advocate for a secure-by-design approach.
It’s important to take these two approaches into consideration as you look into launching a new product or business post-pandemic. Buyers’ journeys will be different than before because people are more aware of security and compliance issues; they want more reassurance that they’re “safe.” If you’re investing in digital innovation, you’ll want to carefully evaluate how you bring your idea to fruition.