ITPEC FE Morning April 2021 Question 66
ITPEC FE Morning April 2021 — Question 66 of 80
Core competence refers to the unique management resources (skills, technologies, know-how) that give a company a competitive advantage over others. These are capabilities that are difficult for competitors to imitate and form the foundation of a company's long-term strategy. The concept was introduced by Prahalad and Hamel.
Why not others:
- (a) Describes a management philosophy or guiding principles behind management activities — not a source of competitive advantage.
- (b) Describes external environmental factors (opportunities and threats) — this relates to SWOT analysis, not internal competence.
- (d) Describes business objectives or strategic goals — these are outcomes to achieve, not the resources that create advantage.
Key rule: Core competence = unique internal resources/capabilities that competitors cannot easily replicate, giving the company a sustainable edge.
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