On this week’s episode of Inside Outside Innovation, we sit down with Stephen Shapiro. Steve is the author of a new book called Invisible Solutions. He spent a number of decades speaking and writing and working with corporations all around the idea of innovation. And how companies can reframe and relook at problems to get better results.
Inside Outside Innovation is the podcast that brings you the best and the brightest in the world of startups and innovation. I’m your host, Brian Ardinger founder of Insideoutside.io, a provider of research, events, and consulting services, that help innovators and entrepreneurs build better products, launch new ideas, and compete in a world of change and disruption. Each week we’ll give you a front row seat to the latest thinking, tools, tactics, and trends in collaborative innovation. Let’s get started.
Interview Transcript
Brian Ardinger: Welcome to another episode of Inside Outside Innovation. I’m your host, Brian Ardinger, and as always, we have another amazing guest. Today we have Stephen Shapiro. Stephen is a innovation instigator, hall of fame speaker, author of six books including the most recent one that I wanted to have him on the show to talk about called Invisible Solutions. So Stephen, welcome to show.
Stephen Shapiro: Hey Brian. Great to be here.
Brian Ardinger: Hey, I’m excited to have you on the show. Actually, we got connected, I was interviewing Thomas Wedellsborg a few weeks ago about his new book, and we serendipitously started talking about an example that you talk about all the time. This idea of how do you reframe problems. And we want to start there and give a little bit of background on how you got into this innovation space.
Stephen Shapiro: Sure. So, I started off life and I guess I still am a bit of a nerd. I loved math and physics and all that stuff. Growing up, I was in the math club, went to college, majored as an engineer, left university, went to work for Accenture, and I was doing a lot of engineering work. And in fact, in the early nineties, I was actually involved with something called Business Process Reengineering, which was basically efficiency work. We would optimize businesses.
And one day discovered that the more we optimize the company’s processes, the more they would downsize the workforce. I had this existential meltdown. And took a leave of absence, reinvented myself. And in 1995, 1996 timeframe, I decided to focus on growth and innovation. Wasn’t a hot topic that far back, but that’s what I put my hat on and I’ve been loving it ever since. That’s all I’ve been doing for 25 years.
Brian Ardinger: You’ve had the great opportunity to see the evolution of innovation specifically in a corporate environment and how companies look at innovation, how they treat it, how they execute on it. What are some of the things that you are seeing that people are getting wrong about innovation?
Stephen Shapiro: Well, it’s been interesting, like you said, having been in for 25 years, I’ve seen the evolution. It started off as basically R & D. And then it started sort of in the early 2000s, 2003, 2004, it started to gain some traction in terms of it being a companywide, an enterprise wide endeavor, rather than just sort of this little group. But I think the thing which I’ve seen most organizations get wrong is they collapse innovation with creativity. And they believe that quantity of ideas will drive value for the organization. And from my experience, you might get there eventually, but it’s an extremely expensive and slow way to go about it. So that to me is the biggest mistake is a focus on ideas and quantity rather than focus on questions, opportunities, and solutions that drive the greatest level of value.
Brian Ardinger: Yeah, that’s an interesting topic because you talk to corporations that are spinning up innovation labs, and they’re putting maybe 5 or 10 ideas in a year, hoping that one of those five or 10 will end up being Uber or whatever the next thing is. And not realizing that like the startup ecosystem alone is putting out thousands of these types of ideas and Uber or Twitter or whatever it comes out of those thousands of ideas.
And it’s very hard for any one organization to have that lead flow or deal flow in such a way to have enough of that throughput really to make that happen. If it’s not about ideas or if it’s not just about ideas, you know, you have to have the idea and you execute on it. What are some of the things that corporations should be thinking about when they start about thinking about innovation?
Stephen Shapiro: It comes down to, instead of focusing on the solution, it’s focusing on the question. And the thing that I found is paradoxically, the more we try to focus on the end game, the goal, the, the solution, the less likely we are to find good ones. And so what I always tell my clients to do is anytime they’re chasing ideas, chasing opportunities, just push the pause button for a moment. Just say, what are we really trying to achieve here? What’s the problem we’re trying to solve. What’s the opportunity that we’re trying to take advantage of. And is there a better way to ask the question that will get us a completely different result?
Sometimes it’s that simple, but it’s recognizing that having the answers isn’t the answer. It really is about the question. The problem, I think a lot of times as leaders feel like they have to have the answers and I think that’s actually not good leadership. A good leader is somebody who asks questions, which gets the rest of the organization to ask better questions. And when you have an organization, that’s actually thinking about it from the perspective of what creates the greatest value. And is there a different way we can do it. We now get more much greater throughput than we would otherwise.
Brian Ardinger: And that whole fear of failure. It makes sense from the standpoint of corporations and organizations that have figured out a business model that works, you know, the idea of killing that business model or failing at that business model is quite scary. But yet if you’re going to create something new that is uncertain, and unknowable have to go through some failures to figure out that and navigate that particular process.
Stephen Shapiro: Yeah. And here’s an interesting, I just want to build on something you said earlier, is I’m not sure that large corporations should be doing a lot of radical innovation. Because if you think about the way markets work, I mean, we will talk about an Uber or Lyft as sort of this breakthrough innovation, but the reality is if you think about the number of companies, small startup companies that are trying new business models and new technologies and fail. The success rate is extremely small. So, to assume that a company is going to have a high likelihood of success is a high level of egotism in some respects.
If you focus on what the real opportunity is, then you can put a separation between the opportunity and the solution. And it doesn’t mean you as an organization need to find the solution. It doesn’t even mean you need to invest in developing it. You could use open innovation and crowdsourcing to buy a solution elsewhere and could do tech scouting. You could partner, you could buy another company, you can license technology from another company. But when you put that pause between the opportunity, question, challenge, whatever you want to call it and the solution, it now opens up the range of possible opportunities.
Brian Ardinger: Right. And clearly defining what innovation means to you and your company. And how does that play out in your execution of those ideas across those horizons? That’s interesting.
Stephen Shapiro: And my definition of innovation is very simple. It’s relevance. What you’re doing, needs to keep you relevant in the minds of whether it’s your current buyers, your current clients, your future clients and customers, but it’s all about relevance. And if you don’t adapt, evolve and change enough as an organization to be relevant, then obviously you’re going to be out of business. Innovation isn’t about novelty. It’s not about creativity. It’s not about quantity. It is about adaptability and relevance.
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Brian Ardinger: You talk about this in the book a little bit. It’s almost like a process of unlearning that you have to go through. It seems like too many folks either ask the wrong questions or approach it from a lens of what they’ve done in the past. So, can you talk a little bit about the process of kind of unlearning and how companies should be thinking about how to ask those questions?
Stephen Shapiro: One of my beliefs is that expertise is the enemy of many forms of innovation. Not all innovation. Incremental innovation obviously is driven by a deep understanding of the domain in which you operate. But when you’re looking to expand. When you’re looking to shift directions, when you’re looking to create something that’s a little bigger than just a small incremental improvement, our past experiences limit us.
And a large part of that is because of just the number of the assumptions that we have built into everything we do. So, we assume that we have an understanding of our customers. We assume we have an understanding of our competition and we have assumption around our industry, but the reality is we knew our customers. We don’t necessarily know our customers because it’s trite to say it, but everything is changing super-duper fast these days. And our understanding of the market tends not to change as fast as the market is changing. And so that becomes an albatross that prevents us from being able to adapt.
Brian Ardinger: So, let’s talk about your new book. It’s called Invisible Solutions: 25 lenses that reframe and help solve difficult business problems. Tell us about what readers can expect from it.
Stephen Shapiro: Sure. So, the reason why I wrote this particular book is my previous book came out nine years ago. And when I started sending around early copies of that book, people would read it and they would say, hey, you know, this whole part about asking better questions. That’s really great. It’s profound. It’s interesting. You talk about why we need to do it and what we need to do, but I’m still struggling. How do I do it? And so soon after the book was launched, that book is called Best Practices Are Stupid. That was back in 2011. I started working on this collection of what I call lenses and lenses are nothing more than different ways to look at a problem statement.
It’s not necessarily designed to find solutions, but rather to reframe the original problem as a way of finding potentially different solutions. And so, I just started cataloging these for about a decade and one day I thought, okay, it’s time to write another book. I had 10 years of using these lenses with companies and seeing incredible breakthroughs with them. And so, I decided just to package it up and the book is really heavily focused on the tool aspect. So, it’s a very much a how book rather than sort of a why or what book that was really my goal.
Brian Ardinger: Talk a little bit about some of those lenses. I know you break them down into five categories as far as, you know, reducing abstraction, increasing abstraction zeroing in on the problem. Can you talk a little bit about some of the key lenses and maybe some examples of how their used?
Stephen Shapiro: Sure. I think they’re all useful in different situations. A good one. First thing is I think when we’re asking questions, when we’re thinking about the problems we want to solve, either it’s implicit in the problem we’re trying to solve. So, like a suggestion box. Hey, give us your suggestions while the implicit question is how do I improve the business? Well, that’s a big, broad, abstract question. And one of the things we know is if we ask those big, broad, abstract questions on average 99.9% of the ideas that are submitted will either be bad ideas or they’re low value ideas or their ideas that the organization decides not to move forward with.
And so, it just wastes so much energy. So, the reduce abstraction lenses are the ones that take something like that. Like how can we increase revenues? Which might be big, broad, abstract question. And one of the lenses is the leverage lens and the leverage lens says, what’s the one factor that will have the greatest impact. Like if we get only focus on one part of this, what would give us the greatest result? So, if you’re trying to focus on revenues, maybe the greatest leverage is particular customers. Instead of trying to be the best for every customer, let’s figure out who our best, most profitable, valuable customers are and really up our game for them.
Or it might be geographies. Maybe there’s certain geographies where we really excel, and we’ll get leverage there. So that’s just one of the lenses and it really depends on the nature of the question, but I find that the 25 lenses really do apply to almost any problem with a little bit of creativity.
Brian Ardinger: Do you recommend somebody in an organization systematically going through those lenses and using those lenses on a regular basis when they encounter every core problem? Or how should one execute on that?
Stephen Shapiro: I think there’s a lot of different ways that I’ve seen companies do it. I mean, sometimes it really is as simple as here’s a project we’re working on. Let’s just put it on hold for a moment and let’s just ask what’s the underlying problem we’re trying to solve with this project. And then let’s take a half hour. I’m not talking about days or months. I’m talking about a half hour just applying some of the lenes. And what we’ve seen is in 15 minutes, 20 minutes, 30 minutes. Just going through the lenses. Somebody’s going to have a light bulb, especially when you do it as a group of people.
When they’re having that conversation, a light bulb will go off and they’ll realize, Whoa, we were moving quickly down the wrong path. We can move in a different direction and get a better result with less. And so, it’s usually a collaborative effort. I find that’s the best way to do it is with a group, go through the lenses. You can choose a lens at random; you can divide and conquer and then come back together. But it’s not intended to be a long laborious process. And then what will happen is after a period of time after you do it, you now start to remember the lenses. If somebody asks me a problem statement, I can usually give you 20 reframes of that problem without having to whip out the lens.
Brian Ardinger: Can you give us an example of companies that have used this or some case studies that you’ve seen.
Stephen Shapiro: Sure. I remember working with a big consumer goods company. And one of the things that we were looking at that was how they were structuring their IT department. We just started to look at it. And what we realized was is that they were handling everything for almost like the worst-case scenario. So, every process was overly complicated. And so, we use the variations lens, which says, okay, like instead of designing for the exception, let’s design to handle the exceptions. Even if it takes a lot longer for the exceptions, but let’s design for the most likely cases. And we’ll have a variety of different strategies depending on the situation.
And just by using that technique, they were able to improve throughput by 60% while reducing the number of people that took to do the work. So, it’s really this mindset that let’s figure out what really, we need to be focused on. What’s going to give us the greatest value. So, like the reduced lens is one which I really like, because a lot of times when we’re talking about innovation, we’re always talking about what can we add? What features should we put into our product for working with technology? What do we do to make it more sophisticated?
But the reduced lens comes from the perspective of sometimes simplification is the best innovation. What can we do to remove just even explicitly asking that question is what can we remove to make it a better product? How can we make it more accessible? How can we make it more valuable to people? Or how can we make it more valuable to the people we needed to have it be more valuable to?
Brian Ardinger: We are living in some disruptive times over the last 12 to 14 weeks, the world has shifted dramatically. And I now think a lot of folks have understood that what disruption really does mean what are you seeing out there in the marketplace? What are the questions that companies are coming to you and asking, and what are you seeing as far as new trends?
Stephen Shapiro: Well, I think the first thing is to recognize that there’s typically, anytime you have a massive disruption, like we’re going through right now, there’s two phases that take place. The first phase is always sort of a reactive adoption. So, one of the things that we immediately saw as soon as nobody could meet in person, the problem everybody’s trying to solve is how can we meet virtually when we can’t meet in person, but that’s a reactive knee-jerk approach to the problem. It’s why Zoom’s market cap tripled in just a few months, because everybody went on to zoom. But there is a second phase, which is to me, sort of a proactive innovation, which says, okay, you know what, just simply automating what we did in the past is not necessarily the best solution.
Let’s again, put the pause button step back and say, how can we do it different? How can we do it better? And so, one of the things I’m finding is when we take the question of how do we meet virtually, well, now that can spin out into a whole number of different questions. So, for example, the resequence lens is really about timing. What could we do before? What could we do after?
We seem to assume that we need to get everybody together live, but like when I’m delivering a speech, there’s a percentage of what I deliver that’s sort of the same stories. So why would I deliver it when people are sitting live? I now, before an event, will set up a place where people can go and watch videos. Highly produced videos of me telling those stories so that when we meet live, we maximize the value of that in person conversation. So, it’s changing the conversation, changing the question, changes the way we think about the problem.
Brian Ardinger: Well, it’s fascinating times we’re living in. I do appreciate you coming on Inside Outside Innovation here to tell us a little bit about what you’re seeing and give us some insights into how to navigate this new next. If people want to find out more about your book or more about yourself, what’s the best way to do that?
Stephen Shapiro: So, you find out about the book at invisiblesolutionsbook.com. It’s a super easy place to go. And you’ll find out about me there. Another place to go, which is just a fun story. And you sort of alluded to this in the beginning is my baggage claim story, which is one of my favorites, baggageclaimstory.com. And it’s a short six-minute video of me talking about how you can take a very simple common problem and reframe it a half dozen different ways to get some very cool and interesting solutions.
Brian Ardinger: Well, Stephen, thank you again for being on Inside Outside Innovation. Looking forward to continuing the conversation and have a great day.
Stephen Shapiro: Fantastic, Brian. Thanks so much.
Brian Ardinger: That’s it for another episode of Inside Outside Innovation. If you want to learn more about our team, our content, our services, check out InsideOutside.io or follow us on Twitter @theIOpodcast or @Ardinger. Until next time, go out and innovate.
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