CORE COMPETENCIES

Applying Prahalad and Hamel's Theory of Core Competencies

Applying Prahalad and Hamel's Theory of Core Competencies

Introduction

Core competency is basically a management theory's conception that advocated for the very first time by C.K. Prahalad and Gary Hamel, who has been two famous authors of business studies. In their viewpoints, a core competency is a particular factor that any business considers as being essential to the way by which the organization or its human resources work. In a business organization, it accomplishes three main criteria, such as becoming the most powerful competitor in the marketplace; reutilization of core competencies widely as per needed for various markets and products; and making contributions to the experienced benefits of end-consumers. Core competencies of any organization can be shaped in various types, inclusive of subject matter/technical know-how, and a trustworthy process that helps creating intimate relationships with suppliers as well as customers. It may also involve the processes of culture or product development in an organization in the forms of best practices of Human Resource Management, employee dedication, and excellent market coverage, etc.

Particularly, core competencies are the strengths of an organization against other organizations in the business industry which add value to that organization and differentiate it from its competitors. In this coursework, there will be an application of the Prahalad and Hamel's theory of core competencies on an organization in order to understand its competitive advantage. Secondly, there will be a critical evaluation of implementing the theory of core competencies for gaining competitive advantage, and in the end, a critical evaluation will be done on the inside-out approach for strategy formulation.

Overview of the Organization

Apple Inc., that was previously known as Apple Computer, Inc., is originally a multinational corporation of America that is headquartered in Cupertino, California that develops, designs, and sells computer software, personal computers, and consumer electronics. The well-recognized hardware products of Apple Inc are the computers' Mac line, the iPod (music players), the iPhone (smart phones), and the iPad (tablet computers). Some of the software of Apple Inc is the OS X and iOS, the iTunes (media browser), the web browser of Safari, the creativity of iWork and iLife, production suites, and several other operating systems. The company was established on 1st April, 1976 and built-in by the name of Apple Computer, Inc. in the very beginning of 1977. After introducing the iPhone, the word 'Computer' was eliminated from its name in the year 2007, as the focus of the company was shifted towards consumer electronics.

The Apple Inc has been chosen for this coursework as it is a corporation which has a lot of core competencies and the company has got success tremendously by using its core competencies efficiently.

Application of Prahalad and Hamel's theory of Core Competencies for understanding Apple Inc's Competitive Advantage

Core competencies reflect the concept of collaborative learning in an organization and illustrate that how the diversified production skills are coordinated and how the manifold streams of information technologies are ...