FCAT Research
How COVID-19 Changes the Future of Innovation
By: SOPHIA MOWLANEJAD | Septemeber 10, 2020
Sadly, it’s too easy to tally up the losses from COVID-19 – as of the end of August, more than 700,000 lives, millions of jobs, more than 100,000 small businesses in the U.S., and seven to ten months of learning for students. COVID-19 has also disrupted innovation because of how isolated knowledge workers, immigration restrictions, and broken global value chains have impeded knowledge sharing. But crises also present opportunities, and this one is no exception. In fact, COVID-19 has unleashed innovation beyond traditional hotbeds like Silicon Valley, big pharma, and research labs, in unexpected areas like:
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  • Hospitals. COVID-19 has rallied designers, manufacturers, doctors, regulators, mayors, governors and hospital administrators to find new ways to deliver healthcare with nascent technologies, like using 3D printers to fabricate respirators and HoloLens augmented reality to teach staff how to use them. To limit visits, hospitals are finding ways to offer remote care -- Mayo Clinic is reinventing the patient journey to move everything from infusions to rehab to lab tests and imaging to the living room. Service model innovation is coming at a crucial time -- cancer screenings, for example, have plummeted more than 80% from last year. So hospitals are trialing wearables, sensor-embedded clothing and smart home and office tech to collect screening data instead. A startup is carbonizing hemp to create clothes that can track health metrics like heart rate and communicate them to healthcare providers, or let an asthma sufferer know that based on their respiratory rate and the pollen count they should take an extra inhaler to work.
  • Education. Trials are in place to equip classrooms with thermal cameras to detect elevated temperatures, drones to disinfect surfaces, or facial recognition software to track physical distancing and help with contact tracing. 81% of teachers see great value in digital learning tools like AI, VR, or AR. Some public schools are experimenting with VR, because it’s been shown to stimulate creativity, help retain information, and increase engagement. There are also some early attempts to address the digital equity gap exposed by at-home learning. A third of children whose families earn $30,000 or less don’t have a high speed internet connection at home. A subsidized program at the University of California Irvine’s School of Education matches undergraduates training to become teachers with lower-income families that want to create a learning pod to supplement or replace school learning. And a Kansas startup is working with school districts to turn buses into rolling WiFi hotspots that service students without internet access.
  • Developing nations. COVID-19 death rates per capita in Vietnam and Rwanda are much lower than in much of Europe and the U.S. Developing countries with larger populations at risk of COVID-19, fewer resources, and less healthcare capacity needed to innovate new approaches, test them, and deliver them quickly. And that innovation has paid off. Vietnam, with a population of nearly 100 million, has used real-time data and contact tracing technologies to curb COVID-19 deaths to less than 20. Senegal developed an immune-based diagnostic test that shows results in 10 minutes and costs $1, while engineering students at a university in Dakar built a multifunctional robot that can measure patients’ blood pressure and temperature. In Rwanda, the government waived transaction fees on mobile payments and the country went cashless to reinforce distancing measures. Ghana and Rwanda have been so successful with contact tracing and with using drones to transport COVID-19 samples to test sites, that some states like Massachusetts and North Carolina have adapted their approach.
  • Space. The work-from-home revolution can thank satellite internet for keeping millions connected. Beyond that, satellite data is being used to decipher patterns of energy use, transportation, migration, and other economic activities to understand the effectiveness and impact of virus containment measures like quarantines. Innovative ways to manufacture in space are also getting attention, especially in healthcare. Because tissues tend to collapse under their own weight, printing muscle tissue is almost impossible on earth, but easier in zero-gravity. In fact, some heart tissue was printed on the International Space Station last July. With many organs in short supply, space manufacturing could be used to supply lungs for COVID-19 patients needing a transplant. A company 3D printing human tissues in space is also working with KFC to 3D print chicken nuggets, one way to meet the higher demand for meat alternatives during the pandemic. Beyond human and meat tissue, a variety of products seeing greater demand post-COVID-19, from medical implants to fiber-optic cables, could be more easily cultivated in space.

Part of what’s facilitating a faster pace of innovation is that some traditional hurdles are coming down. That’s par for the course in a crisis. During the Great Depression, the federal government wanted to assess unemployment data more than once a decade but didn’t have the resources to conduct annual counts. So they developed faster and cheaper ways to collect data like household sampling, the precursor to our monthly unemployment figures. What barriers are coming down now?

  • Data. Just like during the Great Depression, policymakers are finding new ways to more accurately collect real-time data about unemployment claims and the spread of COVID-19. Experts say we jumped five years ahead in consumer and business digital adoption in weeks, rapidly accelerating the digitization of data and commerce across industries. For example, the nation’s largest public health care system New York City Health + Hospital transitioned from multiple different medical records, scheduling, financial, and data storage platforms to a unified enterprise-wide electronic medical record across their 11 hospitals spanning 70 locations. Hospital administrators said that they reaped large efficiency gains by data sharing across medical screening notes, vital sign monitoring, and patient workups among other areas which allowed them to focus more on patient care. They expect these COVID-19-related investments will leave them better prepared to manage and balance demand across their hospital networks in the future leading to better patient outcomes and experiences.
  • Regulatory. Regulatory barriers are dropping to support programs like Operation Warp Speed, the effort to accelerate the development, manufacturing, and distribution of a COVID-19 vaccine by easing how the government, public and private enterprises work together. Federal and state government have also relaxed licensing laws and reimbursement policies that impeded telehealth, and markets responded. Telehealth services were up more than 4,000% YOY in March 2020, and experts predict more than a billion telehealth care visits by the end of this year. Beyond healthcare, the Office of the Comptroller of the Currency leveled barriers to let banks enter the cryptocurrency custody market, with the goal of bringing in trusted players, reducing fraud and costs, and stoking innovation. In June, Mastercard accelerated its cryptocurrency partnership program to make it easier for people to buy, hold, and exchange crypto, and introduced a rewards program giving 1.5% back in Bitcoin.
  • Infrastructure and network.
  • COVID-19 has been an historic stress test for our country’s network infrastructure. Verizon says that there has been 1200% growth in the use of collaboration tools on its network, and that every day sees New Year’s Eve-level of text messages, with nine billion messages a day. And while internet access was important pre-COVID-19, it’s now essential for work and school. But studies estimate that up to 42 million Americans – primarily in lower-income and rural households -- lack broadband access. To close that gap, the coronavirus stimulus package includes hundreds of millions of dollars to expand broadband in rural areas and improve public networks. Beyond government initiatives, big tech is starting to address the digital divide: Google and T-Mobile are providing 100,000 free points of access to improve Wi-Fi and broadband, Amazon’s donating 10,000 devices and Verizon is discounting its internet service for 250,000 students.

COVID-19 has upped the ante for innovation. Sixty percent of financial services firms say that the pandemic sped up their digital transformation a great deal. And consumers are adopting new behaviors at a rapid clip – Zoom has become a household name and contactless payments have jumped 40%. McKinsey found that companies that stayed focused on innovation through the Great Recession outperformed the market by more than 30% and continued to deliver accelerated growth over the next three to five years. So, how should you think about continuing to innovate and help your customers thrive during and after this crisis?

 
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1 https://www.forbes.com/sites/brucejapsen/2020/06/25/mayo-clinic-and-tech-firm-launch-hospital-care-at-home-venture/#4e0009fa1ec1
2 https://www.washingtonpost.com/health/for-those-at-risk-for-cancer-weighing-the-risk-of-COVID-19-19-with-delays-in-screening-and-treatment/2020/07/17/0707ea72-c13c-11ea-b4f6-cb39cd8940fb_story.html
3 https://www.forbes.com/sites/forbestechcouncil/2020/07/23/innovative-technology-is-the-future-of-education/#19c6792270e3
4 https://www.forbes.com/sites/forbestechcouncil/2020/07/23/innovative-technology-is-the-future-of-education/#53984bbf70e3
5 https://www.educationdive.com/news/the-deep-south-was-left-particularly-disadvantaged-by-coronavirus-closures/580774/
6 https://www.wsj.com/articles/can-you-form-a-school-pod-without-fueling-inequality-these-groups-are-trying-11596542410
7 https://www.axios.com/online-school-what-works-85668c44-c31b-4b06-b1e6-4a55cb7d4730.html
8 https://hbr.org/2020/06/using-reverse-innovation-to-fight-covid-19
9 https://www.reuters.com/article/us-health-coronavirus-vietnam-cases/vietnam-reports-31-new-COVID-19-19-cases-one-death-idUSKCN2550HE
10 https://www.barrons.com/news/senegal-engineering-students-fight-virus-with-inventions-01589349908
11 https://hbr.org/2020/06/using-reverse-innovation-to-fight-covid-19
https://www.businessinsider.com/zipline-drones-deliver-masks-for-coronavirus-doctors-2020-6
12 https://www.nytimes.com/interactive/2020/climate/coronavirus-pollution.html
13 https://medium.com/made-in-space/the-future-of-space-manufacturing-tech-highlighted-at-ces-2019-f133a2de9f6d
14 https://www.forbes.com/sites/johnkoetsier/2020/06/12/COVID-19-19-accelerated-e-commerce-growth-4-to-6-years/#4db2b960600f
15 https://www.usnews.com/news/healthiest-communities/articles/2020-06-02/COVID-19-19-and-the-transformation-of-telehealth https://www.cnbc.com/2020/04/03/telehealth-visits-could-top-1-billion-in-2020-amid-the-coronavirus-crisis.html
16 https://www.forbes.com/sites/matthougan/2020/07/27/the-occs-notice-on-crypto-is-a-really-big-deal/#42a9c6f63014
17 https://www.businesswire.com/news/home/20200720005148/en/Mastercard-Accelerates-Crypto-Card-Partner-Program-Making
18 https://www.axios.com/verizon-says-collaboration-tools-use-up-1200-during-coronavirus-0c94e19d-8335-43ea-8652-72302a1a796b.html https://www.cnbc.com/2020/03/27/verizon-ceo-amid-covid19-cell-calls-hit-highs-only-seen-at-peak-times.html
19 https://www.forbes.com/sites/niallmccarthy/2020/02/07/report-42-million-americans-do-not-have-access-to-broadband-infographic/#1ee25baab12a
20 https://www.cnn.com/2020/04/29/us/rural-broadband-access-coronavirus-trnd/index.html
21 https://www.mercurynews.com/2020/04/20/california-to-give-70000-devices-to-students-expand-internet-access-for-distance-learning/
22 https://www.cnbc.com/2020/04/29/mastercard-sees-40percent-jump-in-contactless-payments-due-to-coronavirus.html
23 https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/innovation-in-a-crisis-why-it-is-more-critical-than-ever
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