Core Competences

• Lesson
• Exercise
• Answer

The Core Competences of Amazon.com

Once again, here’s a recap. A core competence is the result of a specific unique set of skills or production techniques that deliver value to the customer. Such competences give an organization access to a wide variety of markets. Hamel and Prahalad (1990) refer to a number of organizations and their products to support their concept including NEC, Honda and Canon.

Three tests of core competence.

• Provides potential access to a wide variety of markets.
• Should make a significant contribution to the perceived customer benefits of the end product.
• Should be difficult for competitors to imitate.

Check your answers below. How did you get on?

• Answer 1. What are Amazon’s core competences, threshold competences, scarce resources, and threshold competences? Plot them onto the diagram.

• Answer 2. What are Amazon’s material resources, human resources, and intangible resources? Plot them onto the diagram.