Question:
Core competencies are integrated combinations of abilities that distinguish a firm in the marketplace. Several core competencies may underlie each business unit, and several business units may draw upon the same core competency. Sometimes, core competencies can become core rigidities that limit a firm''s ability to respond to changing environment. Dynamic capabilities are competencies that enable a firm to quickly reconfigure its organizational structure or routines in response to a change in the firm''s environment or opportunities.
Respond to the following:
What makes an ability (or set of abilities) a core competency?
Give an example of an ability and explain under what circumstances it is a core competency and under what circumstances it is not a core competency.
Why is it necessary to perform an external and internal analysis before a firm can identify its true core competencies?