Re: Core Competence LO4122

Antonio Espin (aespin@campus.mor.itesm.mx)
Thu, 7 Dec 1995 10:05:13 -0600

On Dec 6, 4:13pm, Pasu Decharin wrote:
> I've been reading articles about core competence and the problem I have is
> that most concepts stated that core competence is an integration of either
> skills and knowledge or resources and capabilities by using the learning
> mechanism. But how what is the integration process? and how does the
> learning mechanism involve are still unclear to me.
>
> I would appreciate hearing from someone with experience in core
> competencies or how to involve learning mechanism into the competencies
> development process.

It might be useful to recall Ikujiro Nonaka4s HBR article titled "The
Knowledge Creating Company". Nonaka4s view of a process of converting
knowledge from implicit (personal knowledge) to explicit (common
knowledge) and then nurture the propper environment to transform the
explicit to implicit, attacks a key element for developing competencies:
teamwork and team learning. An organization learns if its members expand
their knowledge. Leonard-Barton ("Wellsprings of knowledge") points that
the ultimate comeptitive weapon rest in the members of an organization, in
their ability to continuosly innovate and improve the way things are done.
The competencies are created by people, not technology acquired from an
external source which can in time be elevated to a competence if it's
developed for internal use, and its original content enriched by an
aggregated value relevant to the company and not easily available to any
competitor (Prahalad and Hamel).

In 1993, we consulted in a small business, developing a strategic plan
based on the Core Competence Building approach. There was barely 20 people
in this company, a wooden furniture shop. It became apparent to us the
real need for this people: be aware of where the future market will be,
and how to prepare for a smooth migration to it. The owner had clear that
a key point was to progressively build capacities in his employees, so
they were prepared to penetrate a mostly unknown market. He decided to
train people by evolving their duties in terms of the extent to which they
dominated a basic process, which in turn should give him enough knowledge
to master a new tool or process. Another issue was clear, there should be
"quality circles" to share experience with others and find a best way to
do the work, this we call the "learning sessions".

The results have proven the approach correct: the lead time was reduced by
a third in one year, scrap was almost eliminated, and the quality of
product (measured from materials selection to custom installation) has
been praised by satisfied customers.

Unfortunately, the economic crisis currently being on in Mexico has
stalled the primary market: construction. The company had to downsize and
cut on consulting budget. I wonder if we should have deviced a contingency
plan and an alternate migration path. I hope the situation last not much
and we can go back to the company to finish our project.

I hope this might be of Pasu4s or anyone interest.

By the way, I hope this to be a Merry Christmas to all of you.
Best Wishes.

-- 
Jose-Antonio Espin
e-mail: aespin@campus.mor.itesm.mx
internet: http://www.mor.itesm.mx/SOC_ALUMNOS/IIS/
Vox/Fax: (+52.73) 14.35.89
Industrial Engineering Department
ITESM-Campus Morelos
Apdo.Postal 99-C
Cuernavaca, MEXICO 62050