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Core Competency & Competitive Advantage


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Published in: Business, Education

Core Competency & Competitive Advantage

  1. 1. Core Competency & Competitive Advantage Ali Sadhik Shaik [email_address]
  2. 2. Agenda <ul><li>Core Competency </li></ul><ul><li> -- Roots Of Competitive Advantage </li></ul><ul><li> -- Developing Strategic Architecture </li></ul><ul><li> -- Identification Of Core Competency. </li></ul><ul><li>Competitive Advantage </li></ul>
  3. 3. Core Competence of the Corporation
  4. 4. Core competency… <ul><li>Critical task Of management- Creating products of customer needs but not yet imagined </li></ul><ul><li>Harmonizing streams of technology and delivery of values </li></ul><ul><li>Collective learning in the Organization </li></ul><ul><li>Competency = innovative minds </li></ul><ul><li> + </li></ul><ul><li>Skill full expertise hands = New Product </li></ul>
  5. 5. Roots Of Competitive Advantage <ul><li>Consolidate corporate wide tech. & production skills </li></ul><ul><li>Binds the existing business & a engine of new business development </li></ul><ul><li>Involvement & a deep commitment to work across organizational boundaries </li></ul>
  6. 6. Developing Strategic Architecture <ul><li>A road map of the future </li></ul><ul><li>Consistency in resource allocation & development of appropriate administrative infrastructure </li></ul><ul><li>Cannot be copied by competitors </li></ul>
  7. 7. Identification Of Core Competency <ul><li>Potential access to wide variety of market </li></ul><ul><li>Contribute to the perceived customer benefits </li></ul><ul><li>Should be difficult to imitate </li></ul>
  8. 8. Conclusion <ul><li>&quot;Capabilities are considered core if they differentiate a company strategically.&quot; </li></ul><ul><li>“ A core competency differentiates not only between firms but also inside a firm it differentiates amongst several competencies. In other words, a core competency guides a firm recombining its competencies in response to demands from the environment.&quot; </li></ul>
  9. 9. Looking inside for Competitive Advantage
  10. 10. Internal Blanks of SWOT <ul><li>The Question of Valve </li></ul><ul><li>The Question of Rareness </li></ul><ul><li>The Question of Imitability </li></ul><ul><li>The Question of Organization </li></ul>
  11. 11. The Question of Valve <ul><li>Understand firm’s resources and capabilities in adding value </li></ul><ul><li>Constant evaluation in changing competitive environment </li></ul><ul><ul><li>Ex: Sony, 3M. </li></ul></ul><ul><li>Resources and Capabilities differ from company to company </li></ul><ul><ul><li>Ex: Rolex and Timex </li></ul></ul>
  12. 12. The Question of Rareness <ul><li>Firm’s unique internal attributes </li></ul><ul><li>“ How many competing firms already posses these valuable resources and capabilities?” </li></ul><ul><ul><li>Ex: Domino’s and Pizza Hut </li></ul></ul><ul><ul><li>DELL and HP </li></ul></ul>
  13. 13. The Question of Imitability <ul><li>Duplication and Substitution </li></ul><ul><ul><li>The importance of history </li></ul></ul><ul><ul><ul><ul><li>Ex: Caterpillar and Komatsu </li></ul></ul></ul></ul><ul><ul><li>The importance of small decisions </li></ul></ul><ul><ul><ul><ul><li>Ex: Mail box Inc </li></ul></ul></ul></ul><ul><ul><li>The importance of socially complex resources. </li></ul></ul><ul><ul><ul><ul><li>Ex: Sony, HP </li></ul></ul></ul></ul>
  14. 14. The Question of Organization <ul><li>Complementary resources of org. </li></ul><ul><li>“ Is a firm organized to exploit the full competitive potential of its resources and capabilities?” </li></ul><ul><li>Limited ability to generate competitive advantage. </li></ul>
  15. 15. Related case <ul><li>Competitive implications of the “Cold Wars” </li></ul><ul><li>Competitive Position of the Macintosh Computer </li></ul>
  16. 16. Conclusion <ul><li>“ If you don't have a competitive advantage, don't compete.” </li></ul><ul><li>-- Jack Welch </li></ul><ul><li>“ The ability to learn faster than your competitors may be only sustainable competitive advantage.” </li></ul><ul><li>--Arie De Geus </li></ul>