how strategic are you being in your approach to a project that you're working on right now perhaps a business that you're building or even just a goal that you're working toward an effective strategy could be the difference between success or failure in any of those Realms but what is strategy exactly that is a question that Michael Porter addressed in his article way back in 1996 published in the Harvard Business Review eventually included in this compilation in 2011 and it came to my attention thanks to a newsletter by Barrett Brooks former COO of convertkit who's now doing his own thing recently launched a podcast called good work with Barrett Brooks first guest James Clear I'll link to that down below but what I would like to do here is sketch out a summary of this article because I've realized that strategy is something that is important to me and I think very relevant to the work that I do teaching the skill of sketching out ideas because whether I'm making a visual summary of a book that I've read or planning out a project at the core what I'm attempting to do is visualize the strategy behind a book or the strategy with which I would like to approach a project so I think that me getting clear on what strategy is will support my work and I hope that the same goes for you the anchor to my visual summary is going to be one of the examples included within that article an example that has some personal significance to me in that it's a company I'm familiar with you probably are too I've got one of their products just off camera I bet you can already tell what this example is if you yourself have experienced it it is the Juggernaut that is Ikea and throughout this video I will be sharing some of the major components of Ikea's business strategy as it relates to the core ideas that Michael Porter shares in this article the first thing that Porter does is make a clear distinction between operational effectiveness and strategy operational effectiveness is essentially about just doing things well following best practices around the production and selling and delivery of whatever product or service you're offering operational effectiveness is fairly easily emulated by others so it's not going to set you apart there's going to be the assump that you do all those things well that's kind of your entry point it's a strategy that can distinguish you from your competitors or can make your project Stand Out amongst the others out there and the first aspect of strategy that Porter points out is the fact that strategy rests on unique activities it's about what you do that's different than what other people do and it's not about Mission it's not about values it's about what what you do and since Ikea is a build it-yourself Furniture offering let's bring in some of the tools that you will likely see when you open up an instruction manual for whatever piece of furniture you just purchased couple of screwdrivers and probably a hammer one of the things that makes Ikea unique is the limited customer service that they provide Ikea is not going to hold your hand through the purchasing and selection process there are stores these huge warehouses that you navigate through and where you can see sample living rooms and bedrooms and kitchens and all the products you might purchase from the shopping to the building of what you ultimately might buy a lot of it's on you on the customer there are of course employees to help you out if you need it but there's plenty that you can do on your own another thing that makes Ikea unique is their modular Furniture Design if I were to show you just this image or perhaps this one representing what might be the most sold piece of furniture ever a piece of furniture that is in my office if you see a diagram like this and you have experience with this brand you will immediately recognize it and probably have memories associated with it this of course is is part of the Billy bookcase that is sold some number of times every single minute and it also helps to illustrate the second point about strategy that a sustainable strategic position requires tradeoffs you will have to make decisions not just about the things that you'll do but the things that you will intentionally not do and to represent that in the style of an Ikea instruction manual being explicit about the fact that we do this and as a company as an individual we don't do this Ikea offers affordable clean somewhat minimal furniture options that's what they do they don't offer a ton of customer support they focus on a modular Furniture Design which means that they don't have thousands of opportunities for customization we don't hold your hand through the entire process but instead focus on self selection both as you're making your decisions about what furniture you'd like to purchase as you walk through all those different display rooms and also once you make it to the end and have your list you as the customer go to the warehouse and pick it up those decisions around the activities that Ikea will do and not do is both what makes it unique as a company and what keeps prices low for us customers so as you think about your strategy for how your taking on your project or building your company you're not going to be able to do everything that you might want to and the pursuit of everything will actually hinder your progress so you've got to ask yourself what do you do what are you about and what are you not about this is a super useful constraint that might be hard to implement at first but the thing that can ultimately set you apart and make your strategy successful and the third and most important component of strategy is that it is is fit that drives both competitive advantage and sustainability fit is about how well the activities that you choose to do fit together is there good alignment between those activities and Porter identifies three layers of fit that kind of build on each other the first layer which I will represent with the simple little mini wooden Dows that you use to help join the furniture together these little guys over here that first level of fit is simple consistency are your activities consistent with each other are they working toward the same goal do they have the same values the same theme serving the same audience this is your Baseline level of fit from there you might move to the level of fit that I will represent with the support piece here that goes into the wall into the side of a billy bookcase right here and here to support one of the shelves we'll use that to represent reinforcing activities this is where one of the activities that you do makes another one stronger so in this case the modular Furniture Design supports and reinforces the activity of limited customer service because of how relatively easy this furniture is to put together so are the activities that you're taking on in the realm of marketing and product development and product or service delivery do those activities reinforce each other if so you're on your way to a good strategy but you might not yet be at the third level of fit represented by what I think is my favorite task to complete when you're building something from Ikea where you screw this into one board and then join it to another with this little guy at a perpendicular angle that cinches everything together it's so satisfying and this represents optimization of effort can one of the activities that you choose to take on actually eliminate the need for another activity how many nails and how much time spent hammering does this Innovative joinery activity here prevent for us as the customer or from Ikea's point of you how much effort is optimized when you take into account the modular Furniture Design and and low manufacturing cost combined with limited customer service and self- selection by customer you can see how much optimization of effort is going on here because of the specific tradeoffs that Ikea is making not Desiring to be this high-end furniture store but instead focused on people shopping on a budget maybe they just moved into their first home they need some furniture that looks pretty good that's not going to break the bank they want to save money by doing things themselves they maybe even enjoy the experience of walking through all those display rooms Gathering the materials even building them yourself there's something satisfying about that so what Ikea has done is developed a very successful strategy that meets the needs of a specific customer that is based in activities that make them unique from their competitors where they are very clear about the tradeoffs that they're making what they're choosing to do what they're choosing not to do and where those combinations of activities fit together well where there's plenty of consistency across the board and in some cases where certain activities reinforce others and in the best case scenario where some of those decisions about the activities they'll take on has completely removed the need for others Ikea has made their way along this progression of fit to the point where I think it's safe to say more of their activities live in these two Realms than even in simple consistency and whether or not you you shop at Ikea I hope that this little sketch here maybe helped you to think about the strategy that you're using the activities that you are taking on related to a project that's important to you or a business that you're building it's been a helpful framework for me to think about what I do here at verbal to visual where my goal is to help people develop their visual thinking skills a big component of my strategy is making YouTube videos that fall in one of two categories I sketch out visual summaries of things that interest me mostly books books sometimes articles and I make videos specifically about visual thinking how you can develop and use these skills the first maybe brings new people into this world the second helps them get started on their own path and then perhaps after finding me here folks might dive into one of my other activities where I write books make online courses host workshops for organizations and speak at events and I think there's at least the potential for all of those activities to be reinforcing if not also optimizing my effort because the YouTube videos that I make about visual thinking will often end up in a book or a course or a workshop or a talk a talk that I give might lead someone to my YouTube channel or they can explore more a book that I read and then sketch note actually supports my own business because of what I'm able to learn and apply in a workshop that I host someone asks a question that spark the topic for a future video and all along the way I'm leaning on a style one marker one one piece of paper no fancy editing that I hope makes this skill approachable accessible for folks who are maybe new to this and perhaps have some fear of making marks that aren't just letters of sketching things out in simple diagrams and drawings my goal is to break down those barriers to getting started with this type of work and I hope that that comes across in the very activities that you get to see me doing and hear me talking about so thank you for watching this video and if you would like to dive deeper into to the world of visual thinking and develop these skills for yourself check out the resources at verbal to visual.com right now I'm particularly excited about teaching this skill with the explicit intention of helping an individual or an organization better understand and better communicate their strategy internally and externally I'm developing a program called sketch strategy that I encourage you to keep an eye out for if you want to chat about it right away feel free to reach out Doug at verbal to visual.com and do stick around here for more visual summaries of interesting ideas and for more tips on how you can develop this skill set yourself good luck developing your own strategy I'll see you again soon