In the short run, how do C.K. Prahalad and Gary Hamel (‘The core competence of the corporation’, 1990, in De Wit & Meyer, 2010, Reading 6.2) say a firm derives its competitiveness?
From being able to dominate its target market segments
From its ability to build core competencies which spawn unanticipated products
From the integration of resources in new or unique ways
From the price/performance attributes of its current products.
According to Prahalad and Hamel (‘The core competence of the corporation’, 1990, in De Wit & Meyer, 2010, Reading 6.2), which of the following statements about core competencies is FALSE?
As a result of use, they diminish. The way to protect them is within a SBU
They are grounded in communication and involvement, and in working across organizational boundaries
They are about harmonizing streams of technology and the delivery of value
They are the collective learning in the organization.
According to Prahalad and Hamel (‘The core competence of the corporation’, 1990, in De Wit & Meyer, 2010, Reading 6.2), there are three tests that can be applied to identify a core competence. Which of the following examples would pass all three tests?
The loyalty card system as used in coffee shops, such as Starbucks
A supermarket’s online shopping system
A university’s computerized self-enrolment system
A telecom system that connects each house to the network.
How do Prahalad and Hamel (‘The core competence of the corporation’, 1990, in De Wit & Meyer, 2010, Reading 6.2) define a strategic architecture?
It provides the recognition that the SBU should pursue those innovation opportunities that are close to hand; that capitalize on the core products
It provides an impartial way to allocate funds, and hence resources across all SBUs, in an even-handed way
It is a road map of the future that identifies which core competencies to build, and their constituent technologies
It maps the links between core competencies, core-products and end products, so it is possible to identify gaps in the array of end products (and hence fill them).
According to Prahalad and Hamel (‘The core competence of the corporation’, 1990, in De Wit & Meyer, 2010, Reading 6.2), what are the real sources of competitive advantage?
Management’s ability to consolidate corporate-wide technologies, and production skills, into competencies which empower individual businesses to adapt quickly to changing opportunities
The right industry structure and positioning, which will give a company a competitive advantage over competitors and potential entrants
An organization’s ability to find, establish, develop, and maintain stable links with its customers, suppliers, parent organizations, and other stakeholders, who can provide a strong support in hostile environments
The right portfolio of technical resources/technologies (such as digital technology, biotechnology or microelectronics) that will make it possible for a company to have a competitive product and become a world leader in the field.
According to Prahalad and Hamel (‘The core competence of the corporation’, 1990, in De Wit & Meyer, 2010, Reading 6.2), what is the major obstacle for a corporation developing core competencies?
Lacking external sources for critical components, such as technology and knowledge
Limiting autonomy of the strategic business units
Allowing one strategic business unit to become much larger (and powerful) than related businesses
Seeing a corporation as no more than a collection of individual businesses.
According to Prahalad and Hamel (‘The core competence of the corporation’, 1990, in De Wit & Meyer, 2010, Reading 6.2), what is the relationship between core competencies, core products, and end products?
Core competencies originate from the design of end products, which over time become the company’s core products
A dominant market position, in end products, allows a company to develop its core competencies in core products
End products originate from the company’s core competencies, whereas core products originate from the economies of scale
Core products are the tangible link between identified core competencies and end products.