Core Competencies


DEFINITION of 'Core Competencies'

The main strengths or strategic advantages of a business. Core competencies are the combination of pooled knowledge and technical capacities that allow a business to be competitive in the marketplace. Theoretically, a core competency should allow a company to expand into new end markets as well as provide a significant benefit to customers. It should also be hard for competitors to replicate.


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BREAKING DOWN 'Core Competencies'

A business just starting out will try to first identify - and then focus on - its core competencies, allowing it to establish a footprint while gaining a solid reputation and brand recognition. Using, and later leveraging, core competencies usually provides the best chance for a company's continued growth and survival, as these factors are what differentiate the company from competitors.

The term "core competency" is relatively new. It originated in a 1990 Harvard Business Review article. In it, the authors suggest that business functions not enhanced by core competencies should be outsourced if economically feasible.

  1. Body Of Knowledge - BOK

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  2. Gap Analysis

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  3. Competitive Advantage

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  4. Outsourcing

    A practice used by different companies to reduce costs by transferring ...
  5. Brand Awareness

    The likelihood that consumers recognize the existence and availability ...
  6. Value Proposition

    A business or marketing statement that summarizes why a consumer ...
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