企业核心竞争力 The Core Competence of the Corporation

Mobile telephones Facsimile machines Laptop computers
GTE
Business Units
Telephone
Switching and transmission
systems
Defense systems
Lighting products
Digital PABX
Switching and transmission
systems
Digital PABX
Semiconductors
Packet switching
Defense systems Lighting products
Satellites
Telenet
Sylvania TV
A case: NEC VS. GTE
C. K. Prahalad
• One of the greatest Indian business thinkers • Professor of corporate strategy and
international business at the University of Michigan. • Focus on next practices ,corporate strategy and the role of management in diversified multinational corporations
❖Core competence does not mean shared costs, as when a two or more SBUs use a common facility-a plant, service facility, or sales force-or share a common component.
In the long run, competitiveness derives from an ability to build the core competencies at lower cost and faster than competitors.
End Products
Corporation
$ billion
NEC
21.89
3.8
GTE
9.98
16.46
1980
1988
1980
1988
NEC VS. GTE (1988)
NEC
Word leader
Semiconductors
First-tier player
Telecommunications products Computers
New enter
It is also about the organization of work and the diversity of value.
Core competencies are communication, involvement and deep commitment to working across organizational boundaries. Involves many levels of people and all functions.
• A company has failed to invest in core competence building will find it very difficult to enter an emerging market.
Does not diminish with use. And core competencies are also the engine for the new business development. Patterns of diversification and market entry my be guided by them.
Structure:
1 The importance of core competencies.
2 The characters of core competencies.
3
How not to think of competence?
(1) The Roots of Competitive Advantage
The Core Competence of the Corporation
C.K. Prahalad and Gary Hamel
Structure of this article
1
A Case of NEC and GTE.
2
The importance and characters of core competencies.
Japan .
Not
Japanese companies
posses greater technical capabilities.
Yes
They limit the ability of individual
businesses to fully exploit the deep technological capabes
Forgoing opportunities to establish competencies
Two Lessons（教训）
Throw out a baby with bath water in divestment decisions
• The costs of losing a core competence can be only partly calculated in advance.
So how to identify core competencies?
Structure:
1
Identify core competencies
2
Lose core competencies
3
From core competencies to core products
Identify core competencies ——three tests
NEC VS. GTE (1980)
NEC
GTE
Business Portfolios
• Only comparable in technological base and computer businesses
• No experience in telecommunications
Telephone
Satellites
Semiconductors
Packet switching
Telenet Sylvania TV
NEC: Why?
• Strategic intent and strategic architecture of “C&C” (Computer & Communication)
Core competencies should be diffucult for competitors to imitate
Losing core competencies
Outsourcing the core competencies
Having an alliance or without knowing where to built competence leadership
• NEC:
a portfolio of competencies
•
VS
GTE:
a portfolio of business-repeated across many industry
From 1980 to 1988, the achievements of Japanese companies-
Core competencies are the organization's collective learning and ability to coordinate and integrate multiple production skills and technology streams. They are also about the organization of work and delivery of value in services and manufacturing.
3
Identify core competencies and Lose them.
4
From core competencies to core products
5
SBU and Developing Strategic Architecture
6
Redeploying to Exploit Competencies.
Some companies and core competencies
(3) How Not to Think of Competence
❖Cultivating core competence does not mean outspending rivals on research and development.
western companies.
Many examples are given here.
What’s the problem in many western companies?
The problem in many western companies
Not
Their senior executives are less capable than those in
Gary Hamel
• CEO of Strategos, Director of the Woodside Institute, and visiting professor of strategic management at London Business school