Q:

What are core competencies?

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Quick Answer

Core competencies are a company's most important abilities, which give the business an advantage over its competitors and offer a unique customer value. Core competencies are relevant to the customer, are not easy to copy and are applicable in multiple markets.

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Full Answer

Core competencies include technical systems, employee competencies, managerial systems, and values and norms. Businesses use their core competencies to create and develop core products, which in turn are used to make end products. To be able to focus on their core competencies, companies can outsource all business functions that are not, or do not contribute to, a core competency. When businesses fail to develop capabilities besides their core competencies, their core competencies become core rigidities, and they may lose their competitive advantage.

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