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Core Competency

This document discusses the importance of core competencies for long-term business survival. It states that corporations must evolve or they will perish, and that building a core competency over time is key to survival. Core competencies are capabilities that provide competitive advantage, and successful corporations focus on developing competencies before products. Examples are given of dividend-paying companies that have strong brand value, networks, or other competencies that make them difficult for competitors to replace. The conclusion emphasizes that developing a core competency through quality, dividend-paying companies provides long-term sustainability and lower risk.

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104 views1 page

Core Competency

This document discusses the importance of core competencies for long-term business survival. It states that corporations must evolve or they will perish, and that building a core competency over time is key to survival. Core competencies are capabilities that provide competitive advantage, and successful corporations focus on developing competencies before products. Examples are given of dividend-paying companies that have strong brand value, networks, or other competencies that make them difficult for competitors to replace. The conclusion emphasizes that developing a core competency through quality, dividend-paying companies provides long-term sustainability and lower risk.

Uploaded by

aims1718
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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“Core Competency” - The Key for Long Term Survival

“Theory of evolution says continuous change is inevitable and if one does not evolve, they
will perish.”

 A core competency is a specific factor that a business sees as being central to the way it, or its
employees, works. This is true for businesses and corporations. If corporations do not evolve
then their survival is in jeopardy. One thing key to survival is a core competency that the
company has built over time.  Yes, it is important to make and sell products or services.
However, I believe products and services are just the end product or end result.

Core competencies are those capabilities that are critical to a business achieving competitive
advantage. The starting point for analyzing core competencies is recognizing that competition
between businesses is as much a race for competence mastery as it is for market position and
market power. Senior management cannot focus on all activities of a business and the
competencies required undertaking them. So the goal is for management to focus attention on
competencies that really affect competitive advantage.

Corporations that are successful and continue to survive have shown that they focus more on
building core competency. Based on their core competence these corporations have build
products or services that can be applied to variety of applications. Successful companies are
more eager to build competence that will help them become world leaders.  They do not solely
focus on products alone.

 Among others, one place to look for such corporations is the list of dividend aristocrats. Many in
this list have built some competency around which they make and sell products. Proctor and
Gamble, McDonald,Café Coffe Day, Microsoft, Intel, Apple, Walmart, Coca-Cola,  and PepsiCo
are corporations that have strong brand value, franchise network, cost controls, distribution
network that it is hard for competitors to eat away their lunch.

Whether it is running a business or individuals’ investment portfolio, it is important to build a


core competency for long term sustainability. In my case, I focus on good quality companies that
consistently pay or have potential to pay growing dividends over time. I also know that chasing
100% success rate is an allusive dream. Corporations will face difficulties and they will cut
dividends, but the key is to manage them by asset allocation and keep looking for newer
opportunities. It may seem to be an ambitious approach but worth pursuing as it is paved with
relatively less risk.

By- Vivek Pitaliya

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