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Ian Lamont explains the feature of office compatibility mode in Google Docs, allowing users to edit Microsoft Word documents without needing the Word program. To access this mode, users need to install the "office editing for Docs sheets and slides" extension in Google Chrome. This extension acts as a plugin to enable additional functionality in the browser. The tutorial provides step-by-step instructions on how to find and install this extension, making it easier to work with Word documents in Google Docs.
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