Author Archives: Stephen Shapiro

Taking Risk to Avoid Losses

Back in the 1980′s, executives used to joke that you would never get fired for buying “Big Blue” (IBM) computers. It’s not that IBM was the best, but you knew they would not screw up.When I worked for Accenture (then Andersen Consulting), the Economist once called us “The McDonalds of the consulting industry. You know what you will get and it’s not fillet mignon.” People hired us not to get highly creative solutions, but rather to be assured of a successfully implemented solution.There is a reason why consulting firms are so successful.People choose safe, tried and true solutions over those which may be better yet have a risk of failure.This is human nature. People take risks to minimize losses, yet play it safe when it comes to increasing gains.But how much of a gain must be dangled in front of us before we will risk giving up the sure thing? … Continue reading

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Unlocking Perfection - Cleaning Michaelangelo

Antoine de Saint-Exupery, author of “The Little Prince”, once said:”Perfection is finally attained not when there is no longer anything to add but when there is no longer anything to take away.”This is a brilliant quote because it describes the challenge many innovators face. Too often, new products are overly complex and end up ‘over-serving’ their customers. My new computer with Vista and Office 2007 is a perfect example of that. 99% of the software’s functionality goes unused, yet these complexities slow down my computer and reduce ease of use. Being able to do everything for everyone is not perfection.Next time you are designing a process, a product, or a service, ask yourself, “What can I remove?” For most consumers, simplicity is more important than comprehensiveness (and complexity).The concept of ‘taking away’ is also a great time management technique. In addition to your to do list, be …

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Early ATM

“Build it and they will come.” We hear that mantra a lot. But with innovation, it is often more like, “Solve a pain and they will come.” The ultimate success of the Automated Teller Machine (ATM) is a great example of this.The other night I was having dinner with someone who in the mid-1970′s worked with Citibank, the second largest bank at the time. He shared with me the story of the birth of the ATM, at least from his perspective.In 1977, after investing hundreds of millions of dollars in ATM technology research and development, Citibank decided to install machines across all of New York City. But at first, they were not very popular. The technology was confusing to first-time users, the machines were not always accurate (they sometimes dispensed the wrong amount of money), and they were impersonal. I was told that customers who used ATM machines were so … Continue reading

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Amazon Kindle DX

In an earlier blog entry on content, readers provided a number of interesting comments. If you haven’t already read that article (and the comments), you may want to do so in order to understand this new article.Many did not agree with my point of view. And that is great. I only wanted to stimulate some conversation.Let me first address some of the comments (and I appreciate the time that everyone took in writing comments). The comment is in italics with my response following.”I wonder if the Kindle model requires a subsidy to offset the upfront cost of technology development and/or design manufacturing.” Two thoughts come to mind. 1) No one has an issue paying $150 for an iPod even though the cost of the music is pretty much the same. 2) As new generations of eBook readers hit the market, prices will drop. Several are now on the market for … Continue reading

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Innovation Metrics

Sometimes the question you ask is more important than the actions you take.During President Obama’s inauguration speech, he said:”The question we ask today is not whether our government is too big or too small, but whether it works – whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified.”This is brilliant in its simplicity. The same thought applies to innovation.The question you need to ask is not whether you are developing creative products, processes or business ideas, but whether your innovation efforts work – whether they serve your customers, serve your employees, and ultimately serve your shareholders.Innovation is not about change for change sake. It is about purposeful change that creates value that reduces costs, increases sales, or improves cash flow.In these troubling times, asking the right question is more important than ever. Do your innovation efforts work?Stephen …

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Centrifugal Force

Some time ago I received a newsletter that had 10 wacky patents. Here’s my favorite:Apparatus for Facilitating the Birth of a Child by Centrifugal Force: With this invention, the mother-to-be is strapped down to a table that is then is spun to allow centrifugal force to take its course and aid in childbirth. This invention by a husband and wife team was patented in 1965, but surprisingly hasn’t caught on in maternity wards around the country.This raises an interesting question. Do patents help or hinder innovation?The intent of patents was to protect those who make large investments in innovation. For example, a pharmaceutical company that spends billions of dollars on drug development and testing needs protection. Clearly these patents help innovation. No one would invest that much money if someone could come in and replicate their idea.But what about patents that protect ideas; concepts where no real investment has …

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Old Elvis

We often hear that content is king. But I wonder if this is still true.Let’s take some very simple examples.I am sure most of you know that the iPod was not a revolutionary invention. It was merely a new spin on the already existing MP3 player. The real innovation was the integration of the iPod with iTunes. This changed the game. Using this model, the distribution of content became as important as the creators (the musicians) and the publishers (the record labels). Apple is now one of the most powerful and profitable players in the music industry.I now own an Amazon Kindle. I have to admit, I love it (I’ll blog about that another time). But what strikes me is that we are seeing the same ‘content distributor as king’ dynamics unfold again. In the book business, the author’s royalty is a pretty small slice of the pie. I should … Continue reading

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