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CORE COMPETENCE

CORE COMPETENCE. Prof. Dr. SERKAN BAYRAKTAROĞLU 18.12.2013. Core Competency. Core competencies are the collective learning in the organization ,especially to coordinate diverse production skill and integrate multiple streams of technolog y . . Background. Core competencies.

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CORE COMPETENCE

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  1. CORE COMPETENCE Prof. Dr. SERKAN BAYRAKTAROĞLU 18.12.2013

  2. CoreCompetency • Core competencies are the collective learning in the organization ,especially to coordinate diverse production skill and integrate multiple streams of technology.

  3. Background Corecompetencies Strategic intent İnternalanalysis

  4. Background

  5. Definition

  6. Corecompetencies… • … provideconsumer benefits • … must be rare or difficult to imitate. • …can be leveraged widely to many products and markets.

  7. Introduced by Prahalad, C.K. and Hamel, G.“The core competence of the corporation”, published in Harvard Business Review (1990) Inthelongrun, competitivenessderivesfrom an abilitytobuild, at lowercostandmorespeedlythancompetitors, thecorecompetenciesthatspawnunanticipatedproducts.

  8. Consumer Benefits Naver Well-organized supply system Everyday low prices to customer Various contents (ex - Knowledge in Naver)  Comfortable web surfing Wall mart

  9. Hard to Imitate GOOGLE’S FASTEST & LARGEST SEARCH SONY’S MINIATURIZATION Makes core competencies difficult to imitate.

  10. Diversification Diversification of business based on core competence.

  11. The Characteristics of Core Competencies • Combine multiple kinds of abilities. • Several core competencies to one business unit. • One core competency to several business unit.

  12. Identification of Core Competencies

  13. Learned about what core competencies is… • Outside-in strategy model means analyzing the external environment and adjust strategy thereafter.Inside-out means analyzing inside company to find a strategy • Porter s 5-forces outside-in analysis, S & W in SWOT inside-out • Mentioned earlier: Internal and external analysis

  14. Key Questions for Managersin Internal Analysis • How do we assemble bundles of Resources, Capabilities and Core Competencies to create VALUE for customers? • How do we assemble bundles of Resources, Capabilities and Core Competencies to create VALUE for customers?

  15. Core Competencies--Cautions and Reminders • Never take for granted that core competencies will continue to provide a source of competitive advantage • Strategic myopia and inflexibility can strangle the firm’s ability to grow and adapt to environmental change or competitive threats • Core Rigidities are former core competencies that sow the seeds of organizational inertia and prevent the firm from responding appropriately to changes in the external environment • All core competencies have the potential to become Core Rigidities

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