Effective management of core competency for creating product innovation

Abstract

This paper considers the relationship between product innovation and core competency that creates effective product innovation. Customers needs become diversified, meanwhile companies have to derive potential market needs and develop new products in order to survive. Therefore, core competency becomes more important to take advantage over their competitors and brings continuous product innovation. Companies should consider how core competency creates continuous product innovation. To create product innovation, the factors of own company's core competency should be carefully considered. It is important to correctly identify and select own core technology and apply it thoroughly, then combine technology seeds and customer needs for new product development. Three factors of core competency are presented for effective product innovation. The first factor is an acquisition of core technology, the second factor is an application of core technology, and the third factor is combining technology seeds and customer needs. For creating continuous product innovation, above three factors should be significantly strengthened, and they enable companies to enter diverse market.