The Research Of Core Competence And The Development Of Small And Medium Firms Core Competence

In 1990,C. P. Prahalad and Gary Hamel introduced the Core Competence into strategical management. The concept at once was paid attention to by both the theoretical and entrepreneurial circles. It becomes the new point for strategical research and makes the strategical decision heavily depending on corporate capabilities instead of environment. That is to say,this strategical approach is more advanced than its former- the marketing structure method which having been implemented since eighties. But the core-competence approach is not mature. No matter of its concept,evaluation,distinguish and development,there are much work to be done.Recent research is concentrated more on large corporations and groups than on small and medium firms. And more small and medium firms are short of competitive advantages. The existing confused concepts of core competence bring difficulty to research and its application. This paper is a further exploration of the essence of core competence and the causes of its competitive advantage. Firstly,the background,concept,characteristic,usefulness of core competence are introduced. Upon this,the author suggests that core competence is the integral result of corporate resources,harmonization and promotion. In essence it is of the corporateinclusive knowledge and skills that cannot be copied by other companies,and can bring lasting advantages to corporation. In another word,core competence is one kind of corporate capability,which can be defined from the perspectives of capability,systematic conformity,resources and strategic dynamics.Then the advantages and disadvantages of the existing models of core competence development are analyzed in this paper. A new model based on corporate resources management such as resources conformity,deployment,and promotion is put forward to. In a broad sense,the core competence of a corporation is resource different from normal ones. Corporate potential core competence (inclusive corporate knowledge and skills) exists among resources and must be combined with normal resources to form practical core competence and gain further develops. In its formation,the quality and quantity of corporate management play a prior role,which is the starting point of core competence management. Then the paper expatriates how to develop corporate core competence through resources,deployment and promotion.Small and medium firms are different from their counter parts,so is the development of their core competence. How to develop the core competence of Small and medium firms from resources,resources conformity,deployment and corporate promotion are studied in this paper. The lack of core competence in most of small and medium firms of our country is not favorable for them to take part in international competition. The problems of these firms which including resources,its conformity,deployment and promotion hinder them to form core competence,and at last the countermeasures are put forward in this paper.