New developments in organizing around core competences

Abstract

The business environment is continually changing and evolving. This evolution necessitates that business concepts must either change or lose their effectiveness. The core competence approach, as proposed by Prahalad and Hamel in 1990, forms the basis of the competence movement, and it has already begun the process of change. The business community does not act uniformly, and a variety of interpretations and methods of implementation have occurred. Some companies use these concepts to acquire new capabilities from other firms. Managers also disagree on where the emphasis should be placed. There are many facets of what may constitute a core competence. There are some indications that the competence approach will eventually evolve into a distributed competence theory, with an emphasis on innovation, flexibility, and developing employees into a reservoir of skills and capabilities.