I, The Absolute

Core competence

Posted by itheabsolute on June 15, 2005

The strategy Prof tells that the article by name “the Core Competence of the Corporation” is the highest sold article ever published by HBR. The term “ Core Competence” was coined by Hamel-Prahalad duo in 1990 leading to the publishing of this article. The article heavily criticizes the American model of management (I am being very careless in using this phrase, but for the sake of understanding I choose to retain this phrase) in general and SBU modeled organization structure in particular. What they claim is that in a SBU modeled organization people do not rally around the organization’s core competence, if ever it is detected or built, but around the SBU focused and inward looking strategies which will hurt the organizations in the long run. Lack of focus on core competence, either in identifying or nurturing it, is a major flaw of the prevalent models of management. Japanese companies, in contrast, have built themselves around their core competencies. Core competence is something which is translatable into many products, scalable and is carry-forwardable into future. All of a company’s products emanate from core competence. Last but not least, the people who are bearers of this knowledge are the key differentiators and organizations have failed in managing and leveraging people.

Organizations can have core competence. Organizations are extensions of human beings. Can human beings have core competence too? Yes. I have my own core competence. But do I know what it is? If I know what it is, have I built my life, career, and my leisure time activities around my core competence? These are the questions that come to my mind. If my core competence was ability to relate to people there is no point being in an industry or job where I never interact with people. If analytical skills are my core competence then, try however much I want, I will not succeed in a people oriented job. Same rules apply for personal life too. So it is quintessential that I discover my core competence and rally around it to building and bettering my life. How do I know what my core competence is? Descartes, the famous Mathematician-Philosopher, says that he sat meditating one day thinking about each day of his entire life and when he woke up (after many hours), he had become enlightened. It is a good, but not the easiest, way to discover what one is. Other tools are MBTI tests or some personality profiling tests. But these alone, without some amount of reflection, will not help. Here I go, back to my desk to define my core competence.

4 Responses to “Core competence”

  1. JB

    removed the amazon thing. guess that was what was creating probs. thanks for the feedback

    amit had also earlier mentioned about it.thanks to him too


  2. vaibhav

    the exercise of finding one’s own core competence is very difficult but not impossible.

    i have a reasonable belief that i have defined mine. in fact as a part of pre-mba prep most of us would have done it. it is just a matter of codifying it into a singular statement and leading one’s plans from there.


  3. Anonymous said

    the ads on the side of the post are spilling over and blocking lot of words.
    concentrating more on marketing than on blogging? 😉

  4. Anonymous said


    The day you find out how to find one’s core competence..let me know..I think this wud be the most difficult part…(coz once you have identified it, ghosal has already shown the way:-))

    What say???
    — Vaibhav

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