Core Competencies Definition
A core competency is a concept in management theory introduced by C. K. Prahalad and Gary Hamel in their 1990 article for the Harvard Business Review, ‘Core Competencies of the Corporation’. It can be defined as ‘a harmonized combination of multiple resources and skills that distinguish a firm in the marketplace’ and it provides ‘sustainable competitive advantage by facilitating entry into new markets and/or expansion within existing markets.’
In order to gain and maintain a competitive edge, organizations must identify their core competencies and build their strategies around them. This can be done through a process of analysis and benchmarking, which will help to identify areas where the company has a unique strengths or capabilities. Once these core competencies have been identified, they should be formalized and incorporated into the company’s overall business strategy.
There are many benefits to having a clear understanding of your organization’s core competencies. It can help to improve decision-making, focus resources on areas where you have a competitive advantage, and make it easier to respond to changes in the marketplace. Additionally, articulating your core competencies can help attract top talent and provide employees with a clear sense of purpose and direction.
