During this COVID-19 induced recession, it is interesting to consider an economist like Joseph Schumpeter. Schumpeter wrote about the idea of creative destruction not in terms of health related impairment but in terms of economic restructuring. In this model, the old ways of doing things will be destroyed after a recession or other change. Just like the mythical phoenix, though, he argues that new ideas and new ways of doing business will emerge from the ashes. Indeed, the new ideas and the new techniques themselves can cause the destruction of the old ways of doing things. During a health crisis, however, will this way of improving business still apply?

Let’s take a sports analogy like downhill skiing, which I have talked about before. My father in upstate New York used to downhill ski and walk back up the hill. Then a new idea, the rope tow, came along; instead of walking up a hill to ski you could hold on to a rope that would pull you up the hill. What a concept. Now a ski area could open up with a rope tow and attract lots of skiing business. Then came a Poma lift, the T-bar lift, finally a single-chair chair-lift, then a double-chair chair-lift. Now we regularly have the quad-chair lift, with slow loading and slow unloading but fast in-between speeds, as well as the magic carpets, or moving sidewalks, for the bunny slopes. Each innovation destroyed the old ways of doing things and attracted new skiers. And with food and other services, this made it possible to earn more revenue. 

Besides all those ski lifts there was even the gondola, the large cabin on a cable that could whisk you to very inaccessible areas, allow you to ski there on a more conventional lift, and then take you back to your car. The great thing about a gondola is you can have action packed movies with people jumping on and off of them, although I don’t recommend doing any of that. 

Nevertheless, if COVID-19 social distancing measures must persist, few of these lifts would work especially the quad chair lift since it not only seats many people together in one chair, but actually can over-fill some of the ski runs with people crowded together on any given popular ski run. What about Pomas or T-bars?  Can they be sanitized and cleaned between users? Is that necessary? Young children on a magic carpet easily fall and knock into one another on their newly purchased skis. How to manage the use of even that technology in the time of our pandemic?

In the end you cannot be certain any one type of ski lift will work or not. Even after a health inspector helps to put in place a good system, a new study could come out and indicate that what once did work is no longer going to work with this virus or the next one.

Instead of looking to Schumpeter’s creative destruction paradigm as model for business, it might be necessary to look at the Biblical character Job for good council. Job patiently endured tragedy after tragedy but eventually got through it all. Now businesses may have to endure tragedy after tragedy with patience, trying different ideas, waiting to see if they will work, then wait again to see if they will have to be changed and then carry on. The critical thing is that you keep trying new things and adjust. 

Take Taiwan’s try at baseball. They put all the teams in a sort of bubble area, separate from fans. They tested the players and set up games between teams. But then as Rodney Dangerfield once said, “I went to a fight the other night, and a baseball game broke out.” Or was that a hockey game? Either way, apparently two Taiwanese baseball teams broke out in a fight. And that ruined some of the social distancing, not only between the players, but between the players and some of the staff. So, not everything works out perfectly. Still, think ideas through carefully then implement and have some patience as you look to adjust your ideas to changing patterns.  

Doug Reynolds is a professor of Economics at the University of Alaska Fairbanks’ School of Management. He can be contacted at DBReynolds@Alaska.Edu. This column is brought to you as a public service by the UAF Community and Technical College department of Applied Business and Accounting.