Curious Cat Management Improvement Dictionary - Core Competency

Core Competency - Those things that define what is special about an organization, what sets it apart from other organizations. Competencies are those things the company or organization does well. Core competencies are those things that are fundamental to the organization. Without those core competencies the organization would not be the same organization.

Core competencies of organization provide the organization a competitive advantage in the marketplace. For example, Dell's efficient, just in time manufacturing system is an core competency that provides Dell a competitive advantage in the marketplace.

Some define core competencies as "world class." That definition would mean many organizations have no core competencies. That seems to limit the usefulness of the concept.

Some management consultants suggest organizations focus exclusively on their core competencies; and outsource other functions to other organizations. I can't say I agree with that - as a rule. Often an organization is better off performing functions internally rather than outsourcing them even if the function is not a core competency.

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