Project Experience

Manufacturing…Identifying your own core competencies is just the first step. You must understand your competitors' core competencies as well.

Client Situation
To effectively position itself against competitors, a manufacturer must understand its competitors' core competencies. Companies need to compete by doing what they do best…by "sticking to their knitting", but must also examine their own strengths within an industry-wide context. Core competencies are those things that a company does best. Understanding core competencies allows a company to best position its talents and services to the market. It is not uncommon for a company to use its core competencies as part of its marketing pitch or to use the culmination of its competencies to build a "total solutions" strategy. Some companies make the mistake of spreading their business strategies beyond their competencies resulting in a failure to provide the best services and products. By spreading company services beyond capabilities, a company is setting its strategy up for failure. When helping a company develop a strategy for the future, an examination of core competencies is the best way to look at what needs to happen to service the market and guides the company in what they can do best to meet those service needs. If they don't have what it takes to service the market, this also helps them figure where they can go and what they should do to fill in the weak areas. We have helped clients examine the core competencies of their competitors in several instances and then turning the investigation inward to our client company to measure their competencies and the comparison between client and competitor.

Fuld Approach
There are various steps to a complete evaluation. The first is a look at the market and the industry as a whole. What core competencies result in benefits to the end user customer? What core competencies do your competitors have? How well do they support the industry? We then examine our client company with the same issues. After completion, we are able to build a comparison which can be used to support strategic efforts. These issues are prevalent with all manufacturers. Consider the more recent requirement of military suppliers struggling with issues surrounding entry into the commercial market with COTS (commercial "off the shelf" products).

Benefits and Implications
We revealed that the competitor was far ahead in organizing itself to meet the demands of the commercial market in terms of manufacturing, process, and organizational structure as well as marketing distribution. This aided our client in understanding what it needed to do in order to compete against this client in the commercial sector. For more information on benchmarking core competencies in the manufacturing industry and in distribution channels and their effect on strategy development, contactnbulger@fuld.com.