What should managers focus on in order to strengthen their firms core capabilities?
No two businesses are alike, but some are less alike than others. The more ways your company stands out from its competitors, the more likely your business is to attract customers. These distinguishing qualities are related to core competencies, and when you properly identify and act upon these features, your business can thrive. Show
What are core competencies?Core competencies are the defining products, services, skills and capabilities that give a business advantages over its competitors. Put another way, business core competencies are competitive advantages that no competitor can reasonably offer or replicate. Identifying your company’s core competencies – including its core products and most compelling competitive advantages – is an important business strategy for proving your value to both new and longtime customers. When you know your business’s core competencies, you can better forge a strong reputation for your business, market it and grow it by obtaining new customers. Key takeaway: Core competencies are the competitive advantages (products, skills, services, capabilities and more) that distinguish you from others in your field. Examples of core competencies in businessWhen you first read the definition of core competencies above, you might have wondered which of your products or services you could include among your core competencies. If you weren’t immediately able to identify any, that’s OK – core competencies can also be skills and abilities. We’ll get into some real-life examples of business core competencies that aren’t products and services in just a bit, but first, here’s a list of common core competencies:
To explain further, let’s look at an example of a leader in each of these core competencies.
While these examples name massive companies, even small businesses can identify core competencies. We’ll get into that in a bit, but first, it might help to understand your own personal core competencies. Key takeaway: There are six main core competencies, and not all of them are products or services. Most household-name brands have grown to their ubiquitous stature through refining at least one of these core competencies. Examples of personal core competenciesYou might not realize it yet, but as a business owner, every time you search for new employees, you assess each prospective applicant’s personal core competencies. Every skill someone lists on their résumé is a personal core competency, and chances are good that when you identify a job applicant with personal core competencies matching your organizational goals, you’ll move them to the top of the list. Here are some examples of common personal core competencies:
Personal core competencies can also involve highly industry-specific skills. For instance, if you work in information technology (IT), you may excel at certain computer languages or have unique experience working with certain types of customers. That last example ties into a key point when it comes to identifying core competencies: Looking at the people you work with may help you identify your competitive advantages. Key takeaway: Personal core competencies can be thought of as the skills and unique qualities you would seek from people hoping to work at your company. How to identify your business core competenciesLet’s turn back to the aforementioned examples of business core competencies. You’ll recall that all of these examples involved large businesses. If you own a small business, don’t take this trend as an obstacle to identifying your business core competencies. Instead, follow these steps to figure out your business core competencies: 1. Look at your customers and clients.Does your business cater to a specific group of customers or type of business within your industry? For example, some people with IT degrees go on to work with students with special needs whose electronic educational materials must be modified to lessen the learning challenges they may face. A core competency of a company with a strong reputation for providing these services might be a special focus on working with clients with disabilities. [Read related article: How to Find Your Business Niche] 2. Turn to your company’s mission statement.Did you launch your company to address a gap that none of your competitors have filled? Look at your mission statement to remember why and for whom you launched your business – one of your core competencies is providing that product or service to that client base. 3. Discuss your core competencies with your team.Ask your employees what they think your company does especially well, both compared with its competitors and in general. Then, take their answers and compare them with yours. The overlap can point you to your core competencies. For example, if you run a restaurant and want to figure out how to survive as the industry struggles, meet with your team to identify your most sought-after meals and cuisines, and then jot those down as your potential core competencies. 4. Make sure your core competencies actually are core competencies.Here’s an important point to keep in mind: Just because you identify something your company does especially well doesn’t necessarily make it a core competency. Let’s use the restaurant example again: What if other restaurants in your area are also beloved for serving the same meals as your most popular items? In that case, you might not be able to qualify these meals as core competencies because, clearly, your competitors can replicate and offer them. The problem with labeling something that’s ultimately not a core competency as one is that you might shift your business strategy toward focusing on a less profitable product or service. 5. Outsource as needed.No company can fulfill all of its necessary tasks in-house. If you find yourself struggling to prioritize the products and services that best distinguish your company, consider outsourcing other business needs so that you can focus on making your core competencies the best they can be. For example, if your business’s core competency is selling the highest-quality handcrafted furniture in your area, outsourcing your marketing efforts can give you the time you need to properly design and make the furniture. 6. Put your core competencies to the test.Once you’ve determined your core competencies, shift your business strategy to focus on them. If you notice more customers coming to your business – especially if they’ve left your competitors and turned to you – then chances are, you’ve likely identified your core competencies. If not, it’s back to the drawing board, and taking the time to figure out what distinguishes your business from others is never a bad thing. Key takeaway: To identify your business core competencies, look at your customer base and mission statement, consult with your team and then shift your business strategy to focus on your core competencies. What are core capabilities in management?Core capabilities include technical know-how, technical skills, business process know-how and business skills. Distinct capabilities are those things that the organisation is better at doing than its competitors.
How can core competencies be improved?Here are seven steps you can take to improve your core leadership competencies:. Develop emotional intelligence. ... . Build relationships with your team. ... . Strengthen your conflict management skills. ... . Practice making decisions. ... . Become comfortable delegating tasks. ... . Take time to self-reflect. ... . Practice taking responsibility.. What are the skills and capabilities that should be developed within the firm?Increasing performance, productivity and profits through efficient planning, management and implementation of business aims and goals. Forming a reliable financial base and maintain a prudent financial policy. Maintaining a positive and productive company culture. Motivating employees improve their performance.
What are the four key strategies that managers and owners should focus on?By the end of the chapter, you should be able to:
Identify the four interrelated functions of management: planning, organizing, leading, and controlling. Explain the process by which a company develops and implements a strategic plan. Explain how managers direct others and motivate them to achieve company goals.
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