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Is your core competence a mirage?
Managers now consider just about everything a potential competence. Are you measurably better, can you sustain the difference, and does it matter? Building a core competence: three options.
FEBRUARY 1997 ? KEVIN P. COYNE, STEPHEN J. D. HALL, AND PATRICIA GORMAN CLIFFORD
Core competence—the idea that a company can succeed without a structural competitive advantage by becoming the best at a few key skills or in a few knowledge areas—has enjoyed enormous popularity over the past six years. The article that introduced the concept1 has been one of the most requested reprints in the Harvard Business Reviews history. Executive management programs and MBA curricula routinely devote hours to the subject, and executives often refer to their own and competitors core competences as key drivers of strategy.
But despite all the attention this concept has received, its tangible impact on corporate performance has been mixed at best, as these statements attest:
Core competence has too often become a feel good exercise that no one fails.2
True core competences are hard to define precisely and are often discovered retrospectively. That is, as you experiment, you define your competences by simply describing your successes and failures.3
We talked to [core competence experts] and asked them to help us identify our core competences. But after having them work with our senior management, leading them through some group exercises, we really had a mess on our hands. We could not define what was core as opposed to noncore, and what was a competence as opposed to some process or offering we just did well.4
Most managers we talked to were uncertain as to exactly what qualifies as a core competence
Our own observations bear out these views. Few managers we have talked to could claim to have utilized a core competence to achieve success in the marketplace, and even fewer to have built a core competence from scratch. Indeed, most were uncertain as to exactly w
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