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ID: 389133 • Letter: #
Question
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classmate assignment
A core competency refers to the specific set of departmental skills, knowledge, and experience that allows one organization to outperform another. My approved company is Coca Cola and its core competencies are strong brand, and distribution system. These help the company to focus on what makes them different and unique.
Having a strong brand is important because it shows how the company has grown. Coca Cola is one of the most popular and valuable brands in the world, and owns many brands such as juices, water, teas and soft drinks. Their employees help just as much to improve the company’s brand and continue to grow. Coca-Cola has an efficient and effective distribution system. Coca-Cola’s products are being sold in businesses such as supermarkets, restaurants, schools, colleges, entertainment places, etc. in over 200 countries in the world. The products that can be distributed and sold, the more successful and powerful the company became.
Explanation / Answer
When organizational resources are exposed to the organization's specific culture, structure, knowledge, and routines, capabilities are developed. However, to become distinctive or strategic, these capabilities need to be valuable (i.e. efficiency & effectiveness creating) and rare (i.e. value appropriating). Over time, these distinctive capabilities take the form of core competencies. Core competencies become the source of competitive advantage for a firm.
As rightly mentioned in this post, Coca-Cola has its brand and distribution system as core competencies. The unique brand identity of the company makes it stand out among all the soft beverage producers over the globe. With an access to similar resources in a market, Coca-Cola can produce more value by only utilizing its brand value, so the brand as a resource is value-appropriating. Similarly, where the company has a presence, the distribution system is a strategic factor which creates effectiveness and efficiency in its value chain. These two factors create a competitive advantage for the firm.
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