Strategy · Proving to Growing
Success strategies
You write down three to five choices that set you apart, each with the price you pay for it, and that reinforce each other.
Does this sound familiar?
- Your success strategies are 'customer focus', 'delivering quality' and 'becoming more efficient'. Your biggest competitor has the same three.
- 'Roll out a new ERP system' is on your list of success strategies. In a year it's done, and then what?
- You want the best service and the lowest price. Your team doesn't know which one comes first when it comes to the crunch.
- A competitor picks up your best idea, and six months later your lead has gone.
Who it's for, and when
For founders who fill the Success strategies box with good intentions or projects. The choices take shape in Proving, when you see why customers pick you. From Organising onwards you write them down, and in Growing they count the most, because that's when competitors start copying you. In Searching it's too early: you don't yet know what you win on.
The model
“Strategy is making trade-offs in competing.”
In 1996 Michael Porter wrote that a lot of companies confuse improvement with strategy. Working faster, making fewer mistakes, better software: he calls that operational effectiveness. You need it, but a competitor can copy it. When everyone makes the same improvements, they all move forward and nobody gets ahead.
For Porter, a strategy means doing different things from your competitor, or doing the same things in a different way. That takes choices with a price. If you want to be the cheapest, you can't also offer the most extensive service. Porter calls these trade-offs. A competitor who wants to copy you would have to give up what they have now, and they usually won't.
The strongest part of his article is about fit. Southwest Airlines flew only short direct routes, with one type of aircraft, no meals and no assigned seats. That meant a plane was ready to go again in fifteen minutes and could fly more often. Porter drew it as an activity-system map: the choices as circles, with lines where one helps another. You'll find that map written out under Apply it. On the strategy canvas, your success strategies are those choices: three to five, for three to ten years. The lesson Your sandbox says where you play and the lesson What you do better than anyone says what you're good at; here you write down how you win in that field.
Michael E. Porter, What Is Strategy?, Harvard Business Review (1996); brought to the One-Page Strategic Plan by Verne Harnish, Scaling Up (2014).
Something only you do
A success strategy describes something you do differently from the rest of your market. Any competitor can write 'we respond faster'. Very few will write 'we only work to fixed prices per project, never on time and materials'.
The price you pay
Every choice comes with something you can't do or won't do because of it. Write that down next to it. If you can't name a price, it's a wish everyone has.
The choices fit together
Put your choices side by side and see whether they help each other. A fixed rate goes with a standard way of working, and that goes with engineers you train yourself. A competitor can copy one choice. Three choices that lean on each other have to be copied all at once, and that rarely works.
Built to last for years
A success strategy stays in place for three to ten years. Anything that's finished after a year, like a new system or a renovation, is a project. It doesn't belong in this box.
Pitfalls
Choices that work against each other
Wanting to be the cheapest while giving every customer their own account manager. Each sounds good on its own. Together they cost you your margin.
Half-copying what someone else does
A competitor wins with a subscription, so you offer one too, alongside your one-off jobs. Porter saw that companies trying to do both got stuck in the middle. Commit to a choice fully, or leave it alone.
Watch and read
How to draw Porter's activity-system map yourself: the choices as circles, and the lines where they help each other.
Watch on YouTubeThe example from Porter's article, told by the founder himself: short flights, no meals, no assigned seats, and why those choices together mean the plane flies more often.
Watch on YouTubeRoger Martin, former dean of the Rotman School, shows that strategy is a coherent set of choices about how you win, and that a list of initiatives and budgets doesn't replace those choices.
Watch on YouTubeTo go further
Porter's whole article explained in drawings, for when you want more than the map: why improving doesn't give you a position, and how trade-offs and fit do.
Watch on YouTubeRead
On Competition (Updated and Expanded Edition)
Michael E. Porter · 2008 · ISBN 9781422126967
Contains the full article What Is Strategy?, with Southwest Airlines and IKEA as examples of choices that fit together. It's a collection; you can read the article itself in an evening.
View the bookPlaying to Win: How Strategy Really Works
A.G. Lafley en Roger L. Martin · 2013 · ISBN 9781422187395
The same idea as five connected choices, worked through with examples from Procter & Gamble. Goes well with the Roger Martin video. More practical than Porter.
View the bookApply it
- 1
Write down why you won your last five jobs
Write down what the customer said or did when they chose you. Look at two jobs you lost as well, and what you lost them on.
- 2
Turn them into choices
Next to each reason, write what you deliberately do differently from the rest. Start the sentence with 'we' and make it concrete enough that a new employee could act on it tomorrow.
- 3
Write the price next to each choice
What don't you do because of it, or who do you let go? If you can't say, it's an improvement. Cross it out or make it sharper.
- 4
Put them side by side
Write your choices one under the other, then what you do for each, and then the lines: which choice makes which other one possible? See the Southwest map alongside. A choice without a line stands on its own. If one choice works against another, one of the two has to go.
- 5
Do the canvas test
Read the list out loud and ask: would our biggest competitor say this about themselves too? Keep three to five and put them on the canvas.
Examples
The Southwest map, as Porter drew it
The big circles, the choices: 1. Short, direct flights between mid-sized cities and smaller airports 2. Very low fares 3. Little service on board 4. Frequent, reliable departures 5. Planes in the air for almost the whole day 6. A small, productive ground crew The small circles, what they do for it: no meals, no assigned seats, no baggage transfers to other airlines, one type of aircraft (the 737), turned around at the gate in fifteen minutes, tickets from a machine, few sales through travel agents, well-paid staff who own shares. A few of the lines: No meals and no assigned seats make the fifteen minutes at the gate possible. Fifteen minutes at the gate let the planes fly more often. Flying more often with one type of aircraft keeps the cost per seat low, and that makes the low fare possible. Short flights make a meal unnecessary. A competitor who only cuts the meals won't hit the fifteen minutes. For that they'd have to copy the whole map.
The map of an installation company
The choices: A. Fixed prices per job only, never time and materials B. Every type of job has a set way of working on paper C. We train our own engineers What they do for it: a price list per type of job, a checklist per job in the van, a standard stock kit per type of job, their own six-week training programme. The lines: A and B: a fixed price only works if a job goes roughly the same way every time. B and C: people you train yourself work the set way from day one. B and the stock kit: with a set way of working the stockroom knows what needs to go in the van, and an engineer doesn't have to make a second trip. The price: customers who want everything done differently from the set way drop out.
An accountancy firm
They charged by the hour, like everyone else. Now: we work for a fixed monthly fee, calls with questions included. We deliver the annual accounts within ten working days of the financial year end. Every client has one fixed point of contact. The price: clients who only want a tax return go elsewhere. The choices reinforce each other: with a fixed fee you actually want clients to call early, and if you've kept an eye on things all year, the figures are quickly finished.
Do this in your own business
Everything up to here is free. What you fill in for your own business, you keep in Boldcaster.
- You write the Successtrategieën section of your strategy, and it stays on your strategy page.
- You assign the lesson to your team and see who has done it.
- The quiz counts towards your progress, and you see which lesson comes next.
Four weeks free. You'll land straight in this lesson.
Quiz
6 situations. You need 5 of 6 right. You can try again at any time.
1.Your leadership team puts this down as a success strategy: 'We'll become 20% more efficient in our planning.' What would Porter say?
2.Under Success strategies it says: 'Open a second office in Utrecht in 2027.' What's the problem?
3.A painting and decorating firm chooses: 'We only work on fixed prices.' What makes this a real choice?
4.Your success strategies: 'We're the cheapest in our region' and 'Every customer gets their own account manager.' What do you see?
5.A competitor copies your fixed monthly fee. Yet they keep losing customers to you. How can that be?
6.One of your success strategies is: 'We don't build custom work for a single customer.' A large prospect wants to give you a contract, provided you build one module just for them. Your salesperson asks what to do.
Nothing is saved here. In the app, the quiz counts towards your progress.
Read next
- Three-year objectives · You put the numbers next to your 3HAG, for the same year, and you've checked that they add up.
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