I am Unique, Therefore I am Strategic

The next section of this article, “Strategy Rests on Unique Activities,” leads us to define strategic positioning and also the framework of what is strategy.

But the essence of strategy is in the activities – choosing to perform activities differently or to perform different activities than rivals. Otherwise, a strategy is nothing more than a marketing slogan that will not withstand competition.

In an effort to define strategic positioning, Porter looks at three distinct sources which are not mutually exclusive and often overlap.

Strategic positions can be based on customers’ needs, accessibility, or the variety of a company’s products or services.

1. Variety-based positioning: Producing a subset of an industry’s products or services and offering it to an overall market. For example, Jiffy Lube offer a single service, oil changes. They have chosen to focus on this single product and offer it to a large market.
2. Needs-based positioning: Serving most or all of the needs of a particular group of customers. IKEA offers their price-sensitive customers, who have wide furnishing needs, a complete set of furnishing products at a more cost effective price than traditional home furnishing retailers.
3. Access-based positioning: Serving a subset of customers that have been defined by access either geography or scale. For example, Carmike Cinemas operate cinemas in small towns.

Using the construct that you need a tailored set of activities to identify your position, he goes on to define strategy as…

Strategy is the creation of a unique and valuable position, involving a different set of activities.

The article gives some great examples at how various companies, like Southwest Airlines have identified their strategic position and have aligned and execute the activities required to achieve that position.

The next section, “A Sustainable Strategic Position Requires Trade-offs,” will help us understand the trade-offs that need to be considered to be sustainable.

Image source: Teaching and Developing Online.