Strategic Management in Organizations
What is a Distinctive Competency?
The idea behind having a distinctive competency is that business must have something that can add to the uniqueness of the organization; a uniqueness that customers can value and from which organizations can make profit as well as niche in the market. In general, an organization's distinctive competency can be defined as a set of strengths, characteristics and qualities including skills, technologies, or resources that distinguish it from competitors. When the strength provides superior and unique customer value and is difficult to imitate then the distinctive competence creates a sustainable competitive advantage.
How to develop distinctive competencies?
In developing distinctive competence the key is in understanding and capitalizing on your own strengths. Successful companies are ones who know their core competencies and continually work to build and reinforce them. Some of the basic distinctive competencies can be: Price/cost, Quality: performance, conformance, features, durability, reliability, serviceability, aesthetics, perceived quality, Service, Flexibility, and Trades off, Order Winners/Qualifiers etc. the following steps can help in developing distinctive competence;
Brainstorm your strengths
Every organization whether working on small scale or on corporate level possess certain strengths, understanding those strengths and using them positively can help in the growth of the organization. Not all strengths are of similar magnitude in importance. In developing distinctive competency the organization needs to know the strengths it possesses.
What is valuable to the customers?
After brainstorming the strengths, the organization should research on what is valuable to the customers. A company manufacturing cars should have knowledge of what sort of cars customers value. Are they interested in comfort, luxury, or they are necessity-oriented consumers?
Is it Unique?
Next step should be, knowing whether there are other competing organizations that are fulfilling similar needs or not. Is this need fulfilled by others or not? If no other organization has been successful in targeting this need then you can fulfill it and in this case will be unique to your organization only.
Is it difficult to imitate?
Now you know that this can become a unique strength of your organization, you should know whether it is difficult for the competing organizations to imitate it or not? If it is difficult to imitate then you can develop it and enjoy sustainable distinctive competence that no other organization possesses.
Will it add to the growth of
You should also know that is this competence will add to the growth of your organization or not. If by developing this competency you can gain access to new markets; you can have increased sales; increased customer confidence, satisfaction and loyalty; you are on the right track in developing it.
How long you can retain it?
Sustainable competitive advantage is the focal point of the corporate strategy. It allows the maintenance and improvement of the enterprise's competitive position in the market. It is an advantage that enables business to survive against its competition over a long period of time.
Chances of Imitation:
Distinctive competencies remain distinctive until they are not copied by other companies. To retain the competitive advantage companies have to review and refresh their competencies every on and off. They have to develop new competencies with the passage of time.
Sustained Competitive Advantage:
- Keeping Competency Hidden from Competing Companies:
Sometimes companies or organizations are successful in hiding their competencies from other organizations. Other organizations might know that product quality is the competency of a given organization but they can not imitate it because they do not know the procedures, techniques or recipes that made the product of high quality. In this situation organizations have to keep strict control not to let other organizations know about their quality control elements.
- Having a Competency based on Complex Distinctive Capabilities:
Many companies are successful in sustaining there core competencies because the dedication, commitment and perseverance they have put in to develop them are difficult to imitate. In this case other companies can not imitate them, in other words to imitate their core competencies they need to develop the same skill, technology and man-power which is quite difficult. Excellence is the hallmark of Bareeze (owned by Sefam private limited). Their corporate policy includes use of best quality raw material, an unflinching resolve not to compromise on quality; coupled with the use of best textile machinery (imported from Switzerland); they keep an eye on the changes not only on fashion trends, but on the changing lifestyles on the larger scale this enables them to provide their clientele an extremely creative collection of ready-to-wear, prêt, and home textiles every season. They have been appeared as a trendsetter in the mainstream fashion. Many other companies tried to develop products in the same fashion but failed to reach them because they can not produce the same quality products as of Bareez'e.
- A Competency Based on Historical Event:
A competency that is based on some historical event can not be imitated because other competing companies can not develop the same events which became the reason of their success. Such companies always enjoy top position unless their product gets deteriorated to a limit that people go for other companies.
Signs of losing Distinctive Competency:
There are several signs that can tell you that you are going to lose your competitive advantage:
Fuzzy vision, lack of leadership, discouraging culture, high bureaucracy, lack of initiative, poor vertical communication, poor cross functional collaboration, poor team work, poor idea and knowledge management