The only constant thing in life is change, and that’s why mastering innovation is a must in the business world. But how can you innovate when it comes to things that do not ever change? Penny Zenker answers this question with speaker and author Stephen Shapiro. They discuss the 5 Ds of differentiation to make your business constantly relevant in a market full of uncertain and ever-changing trends. Stephen also discusses why differentiation goes beyond tangible products and explains his concept of goal-free living.

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Embracing Business Innovation With Stephen Shapiro

Welcome to Take Back Time. On this show, we look to pick people’s brains so that we can work smarter and not harder. That’s what we want. As you’re yining in, I want you to be pulling out those nuggets that are going to help you to work smarter. I’m so excited to have a friend and great speaker and author. Stephen Shapiro is here with us. He’s a real innovator. He worked in innovation for more than 25 years.

About 25 years ago, he created and led a 20,000-person innovation practice from the consulting firm Accenture. That’s pretty impressive to keep all of those people innovating and being in that mindset. That’s his foundation. He’s also the author of seven books, including his latest book, PIVOTAL: Creating Stability in an Uncertain World. Without further ado, Stephen, welcome to the show.

Fantastic to be here, Penny.

Innovator’s Mindset

Being the depth of innovator that you are, how did that happen? Have you always been an innovator? Were you born with the innovation bug or how did that develop?

First of all, I think everybody is an innovator. We just innovate in different ways, but we’ll save that for a separate conversation. The reason why I’m in innovation and why I’m so passionate about innovation is because before innovation, I was focused on process optimization. What I would do when I was at Accenture is we’d go from company to company, client to client, and we would optimize their processes.

One of the things that I discovered was that when we optimized a company’s processes, they would downsize the workforce. There was a point where I hit a breaking point. I had an existential crisis and said, “I cannot do this anymore. I don’t want to help companies shrink.” I took a six-month leave of absence and reflected on what I wanted to do. I loved Accenture and I loved consulting.

I wanted to help companies grow rather than shrink with the help of a lot of great talented people. We created this 20,000-person innovation practice in about nine months. That’s when I got the innovation bug. My goal has been to help companies grow. For over 25, nearly 30 years now, I’ve never been involved in anything which result in one person losing a job. I want to create jobs in the work that I do.

It’s so interesting that when a constraint comes along, it’s like the first thing that people think of is, “We have to let people go.” There’s no, “How can we keep the people we have and grow in other ways or do things differently that are going to engage people differently?” I do this exercise in some of my events and the first thing that people want to do is they want to let go of people on their team. I’m like, “People get creative.” I can relate to that. Do you find that by innovating, you’re also optimizing?

Innovation requires optimization. It requires simplification. There are lots of different ways to build on what you said. In a lot of cases, the best way to innovate is to get people to do what they do better than anyone else. This means maybe not getting rid of them but realigning them with different activities inside of the organization where they can contribute the greatest amount.

There’s optimization, simplification, there’s fundamentally doing things in different ways. Now we’ve got AI, which is changing the rules. Everybody is worried about people losing jobs. There is that concern, but at the same time, AI allows us to instead of keeping the playing field level and reducing the number of people, what if we raise our game high, leveraging AI but still using the people that we can the best way that they can. I think it’s an interesting time for us right now.

Differentiation

How do you do that? Let’s innovate for a moment. This is the crisis that some people are experiencing. I’ll say crisis for them. Other people are seeing this as a huge opportunity, but those who are feeling that limited, and like you said, what’s one way that they could go about seeing this as a bigger opportunity? What needs to happen there?

I used a number of words. I used innovation, simplification, and optimization. There’s another word that I think is important, which is differentiation. Differentiation from my perspective is not about being different. It is rather creating value for others in a way that no one else does and no one else can.

If we can understand that, not just at a corporate level, but as an individual, what do I do better than anyone else? What is it that I do that creates value? If I can focus my energies there, then I can use, for example, AI tools to elevate my game but it requires us to do some reflection. It requires us to step back and understand, “What is it that we do great?” Most people don’t want to take the time to do that type of reflection because it’s not easy work.

In many cases, it’s difficult because we cannot see it. When I am looking at my differentiator, for example, I always hire outside parties, or a third party to do that work for me because I might influence the way my clients describe my differentiator. I might not see it the same way that an objective third party might. It does take time for us, but it’s conversation. Differentiation comes from a conversation with the people you’re creating value for.

Differentiation comes from conversations with people you are creating value for. Share on X

Like you, I’m going to pull out some of those words that you use because I’m celebrating my new book that’s coming out called The Reset Mindset. That first step you said to step back. We have to step back away from it and embrace that reflection that we don’t give ourselves time for anymore.

We’re so busy that, of course, we cannot innovate and we cannot get out of our own way. It’s because we’re not taking that essential time to be able to even see things differently. That’s the first step in this reset mindset and this reset practice is to step back away from it. I love what you said about the differentiation piece. I like to dig more into that. To me, that goes into the second piece that I talk about, which is the get perspective.

You’re giving us a new perspective, a way of looking at things is how can we dig deeper into differentiation by utilizing people’s unique skillsets or the company’s unique skillsets. Do you walk people through a way of thinking so that they can find that? Maybe go a little deeper with us into that, because I think that’s so critical what you were talking about.

For me, differentiation, we tend to focus when we hear the word differentiation, we hear different. It’s not, but that’s only a small part of it. There are five Ds that I’ve identified for differentiation. The first two Ds are all around, how do you differentiate today? How do you do something distinctive and desirable?

Those are the first two Ds. Distinctive means it’s something you do that no one else does. We could say unique. It doesn’t have to be unique, but it’s something that stands out and it’s that desirable part. It has to be desirable externally and internally. For a company, it might mean that what we create is desirable to our customers, our consumers, and our clients.

As an individual, we need to be thinking about what’s desirable to us. What do we enjoy doing? What gives us the greatest pleasure? We’re going to be at our highest levels when we get it, but that’s today. We need to worry about the future. The next two D’s are durable and dynamic. Durable means no one else can do it. Just because you are doing doesn’t mean somebody couldn’t copy it. Durable means it stands the test of time. Dynamic means that we need to shift. We need to change direction when the world changes direction.

Those are the first four Ds. The last one is about being disseminated, which means we need to, as an organization, make sure every person inside of our organization understands, internalizes our differentiator, and knows how they contribute to it because everybody in your organization contributes. Once we do that, we disseminate externally, which makes sure that we sell where we differentiate, and we market where we differentiate. Let’s not focus on everything we do. Let’s focus on the things that make us special.

Make sure every person in your organization understands and internalizes your differentiation so they can personally contribute to it. Share on X

Implementing Differentiation

I love that. I love that you’re balancing the aspects of today, but also we cannot be focused on today. Otherwise, we’ll wither and die the way that many companies are and there’s that future aspect, and then how do we live into it? What timeframe does it take when people are engaging in this process to say, “I want to bring this differentiation and live into it?” What’s an implementation timeframe that you’ve seen?

Some things can be immediate. The first step, as you’re talking about, is we need to have clarity. That takes time to at least get some level of clarity, and that clarity comes from conversation. Probably the most difficult and time-consuming part is to understand who we are. I’ll tell you a quick story which I love.

There’s a company called Radio Flyer, which is known for its original red wagon. It’s a company from 1917, the current CEO, Robert Passon, is the grandson of the founder of the company. What I love, and he told me this when I was working on my book, he said, “The way that we understand what our purpose is and our differentiator is to have conversations with people.”

I would go up to anybody and everybody and say, “Radio Flyer, what does it mean to you?” The first thing that would happen is people would start smiling and they would start telling stories. It’s like, “My wagon was a spaceship. The wind blew through my hair. It was like a magic carpet,” whatever it was. What happened is people had smiles and it brought back memories of a lifetime and they decided their differentiator is not their products.

It’s not their wagons. It is the smiles that they bring and memories that last a lifetime. Everything they do is linked to that. Every decision they make is linked to that. If you’re at customer service and you’re answering a phone, you’re not there to solve a problem. You’re not there to sell something. You’re there to bring a smile to the person on the other end of the phone. It’s going to last a lifetime.

When they built their store, their goal from the second someone got into that store, it’s not to sell a product. It is about creating that memory, that smile that will last a lifetime. Every person understands it. Every person has internalized it. Once you get that clarity, it’s now making sure everybody lives and breathes it every day.

I love that. In another context, I’ve heard people ask the question, what business are you in? To dig into what you’re saying. A jeweler is not just selling jewelry. They’re making people feel special. Like you said, it’s getting to understand what that unique positioning is that you have. Of course, there are not that many wagon makers, but I guess if you have a jeweler, it’s then what is specifically for that particular group. How do you find that? Okay, there are not that many red wagon makers, but let’s say it’s more of a generic type. Let’s take jewelry as an example. How would one jeweler differentiate themselves from another?

Let’s take Tiffany for a moment and their blue box. First of all, they’ve got their own special blue. It is like a trademarked blue color and only they can use it. What’s inside the box for most people is less important than the fact that it came in that blue box. That is one form of differentiation. I think the key that most people need to understand is that differentiators are rarely products, technology, services, or offerings.

They are capabilities that we’ve developed that allow us to then create new products, new services, and new offerings in the future. You think about Apple. Their iPhone is not their differentiator because every year they have to come up with a new one. The goal of a differentiator is something that lasts for a long period of time but I would argue it’s their design and their integration.

I’m on a Mac with another Mac, an iPhone, and two iPads. Why? Because they talk to each other beautifully. I understand them, and how they work. That is a differentiator for them, which maybe their competitors have slightly better technology specs but it’s that network effect and that simplicity that they do so well. It’s a capability that allows them to create something each and every year.

I always tell my clients, “Stop focusing on the products and technology and all the things that you think make you special because somebody is going to copy them. Somebody is going to replicate them. In a year, what you think is special will no longer be special.” The whole purpose of this is to create stability, create a foundation that will stand the test of time so that when you do need to change direction and when you do need to pivot, it’s built on a solid foundation rather than on quicksand, which is the way most people operate their businesses these days.

On quicksand.

Bright, shiny objects everywhere. We’ve got an opportunity. Most of the opportunities out there are distractions because you don’t have clarity around your differentiator. When you have clarity around your differentiator, you can distinguish opportunities from distractions. Right now, everything looks great because you have no filter or lens to be able to determine what’s what.

Pivotal

Makes a lot of sense. You mentioned your book, Pivotal, and I suppose all of this is in there, these five D’s. You mentioned that the stability factor is the core of what to work around. I want them to hear it from you. Tell us how you describe that to people and how they understand how to have stability in a time of uncertainty.

The way I find stability is to focus on what doesn’t and shouldn’t change. It’s fascinating. In the world of innovation, we’re always talking about what’s new, what’s next, what changes. The reality is if we’re constantly chasing what’s new, next, and what’s changing, we don’t have any traction. There’s no stability. We’re throwing out our past to have a different future.

What we need to do to create that level of stability is to focus on what’s now, what doesn’t change, and what will stand the test of time that if we could double down our investments here, we’d pay dividends in the future. There was a great quote, and I’ll paraphrase it here, but it was from Jeff Bezos.

It was in the Harvard Business Review, I think it was 2007, and he said, “People outside Amazon are always asking me, ‘What’s going to change in the next five to 10 years?’” He said, “This is the wrong question. They should be asking what will not change, what won’t change, and what shouldn’t change in the next 5 to 10 years, because at Amazon, we focus on the things that don’t change so that we can build flywheels that will create dividends and pay dividends for the future.”

I think that’s a powerful simple way to visualize this. What can we invest in today that will pay dividends in the future? Some things will change, but let’s first focus on that stability. I want to come back to something you said a couple of minutes ago. It’s defining the business. What business we are in.

Find out what you can invest in today that will pay dividends in the future. Share on X

Penny, you and I got connected because we’re speakers. Are we speakers? If we think of ourselves as speakers, the way we create value is by getting on a stage and delivering a speech, but we are content experts. I’m an innovation expert. I deliver my content through speeches, but I do consulting, I do advisory work, and I have an apprenticeship program.

We have different ways of delivering. Sometimes we need to reframe the business we’re in to create more value. If we’re speakers, we need to do 20, 30, 40, 50 speeches a year. There’s no depth to that. I’ve shifted my business where instead of trying to do 50 speeches a year, I want to do 15 to 20 speeches a year, and then I want to do 3 to 6 deep-dive relationships with a client where we do transformative work.

It’s more value to them. Fewer clients for me. I’m spending less time selling, which is great because selling is not my strength. We need to understand how can we go deep. How can we create greater value for our customers and clients? That’s the way that we get that stability.

Interesting. Let’s take speakers for a minute because I think that’s a great way. I know that business. You define it as a content creator and expert. Someone else might define it and there’ll be their differentiator. Tell me if I’m on the right track here. Someone else might say, “I’m an experience maker.” For them, they might not want to go deeper. They might want to create these experiences.

If I’m getting it correctly, that’s how you can in one industry have many different people who have their differentiators because of their unique offerings. You can go deep and you can implement these for large organizations or small organizations, and that brings you joy and so forth. I think it’s interesting to use and see that as an example.

Someone else might not be going to that level and might not be the content expert per se, but might be creating an experience or whatever that opened up some new ways to think about it and look at it for me. Hopefully, that’s what people are listening to as well. How do you find those unique strengths and create value only that you can create? That’s what I heard in those examples that were perfect for understanding that.

A buddy of mine, fellow speaker, Jason Hewlett, is like probably one of the most talented people on the planet. He talks about your signature move. I love that metaphor. It’s like whether it’s Michael Jackson doing the moonwalk or Elton John wearing glass. If you ever get a chance to see Jason, trust me, it’s something you want to do because he’s unbelievable.

Jason is seriously the most unbelievable speaker you will ever see. He doesn’t do the type of work that I do, but that’s great because there’s a market for what he does. He’s got signature moves that I don’t have. If you get a chance to experience different types of speakers, even in the innovation space, I’m an innovation speaker. There are so many different innovative speakers.

You’ve got some who are very academic. You’ve got some who might be a little more dynamic. Even in that, there’s a wide range. Differentiation can come in so many different forms. I have something called personality poker. It is a card deck where people trade cards. It’s all around innovation, but not too many people have a card deck that they use with a thousand people in an audience to get people that understand their contribution to innovation.

Reset Mindset

Because not many people used to be magicians. I’m throwing that out there that people might not know that about you. That’s pretty cool. It’s part of your whole offering and how you show up. That’s cool. Unfortunately, we’re out of time. Before I ask you how people can find out information about you, I’ve been asking every guest this question. I love to hear the answers in celebration of my new book that’s coming out, The Reset Mindset. How would you define what a reset mindset is with limited knowledge?

I think for me, it comes back to something we talked about earlier, which is pushing the pause button because we’re so busy and we’re moving. We’re keeping ourselves so engaged in work, but we don’t stop and ask ourselves, “Am I moving in the right direction?” Speed in the wrong direction means you’re moving further away from where you should be going. For me, it’s always very interesting to ask yourself, where am I? Where do I need to go?

My general philosophy is not about goals. I have a book called Goal Free Living, which is an anti-goal book. The general philosophy there is you want a sense of direction, not a specific destination, and then you want to meander with purpose. What that means is every day, you’re going to have new insights, new experiences, and new data that’s going to help you course-correct.

Instead of trying to go from point A to point B on a highway, take the back roads, and change direction. See what’s working, see what’s not working. It is a great way of living life. It’s about experimenting every day to see what works and what doesn’t work and testing it out. It’s a pretty common technique and innovation.

Episode Wrap-up

It’s funny that we’ve talked about this before how we have a lot of similar thinking. The reset mindset is about dynamic reassessment. That would be a great way to describe it. It is goal-free living. I love that. I’ll have to quote you and bring that into this space because I still believe in goals, but I like the idea that it makes you freer, more adaptable and doesn’t limit you, and allows you to take in whatever changes or adaptations are naturally necessary and go where it takes you. I love that. You’re celebrating because you launched your new book a couple of weeks ago. Tell people where they can get it and how they can get more information about you.

The book Pivotal: Creating Stability in an Uncertain World, you can get that at ThePivotalBook.com. If you want to learn about me, go to TheInnovationSpeaker.com. That’s probably the fastest way to find me. From there, it takes you to my speeches, but you can click on my homepage blog and other goodies, or you go to PersonalityPoker.com if you want to learn more about the card game.

Very cool. Thank you so much for being here.

My pleasure.

Thank you all who were here tuning in. A lot of gold nuggets came out of this, whether it was the five Ds focusing on the things that you can do today, the future, and then how to live into that. Many other nuggets that we could take away, even that last piece about goal-free living and being more adaptable where you’re headed. I like that it’s to have a sense of direction but not a specific destination. In light of that, thank you all for being here. My name is Penny Zenker, and we’ll see you in the next episode.

 

Important Links

• Stephen Shapiro
• PIVOTAL: Creating Stability in an Uncertain World
• Goal Free Living
• TheInnovationSpeaker.com
• PersonalityPoker.com
• https://amzn.to/4d047Wj
• https://amzn.to/4d2aV5H

 

About Stephen Shapiro

Today’s guest has presented his perspectives on innovation to audiences in over 50 countries. That’s in-person audiences, not including virtual events.

He started his work in innovation 25 years ago when he created and led a 20,000-person innovation practice for the consulting firm Accenture.

He is the author of seven books, including his latest, PIVOTAL: Creating Stability in an Uncertain World.

His clients include Marriott, 3M, P&G, Microsoft, Nike, and NASA.

In 2015, he was inducted into the Speaker Hall of Fame.

When he is not on stage speaking about innovation, he enjoys dabbling in magic and making the impossible possible.

 

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