USING CORE CAPABILITIES TO CREATE COMPETITIVE ADVANTAGE

Many companies are turning away from elaborate strategic planning processes and the large staff departments required to administer them. At the same time, other companies are taking an opposite path-by showing a renewed interest in strategic thinking and involving wider cross sections of management in the strategy development process than ever before. What is driving these paradoxical movements? Long and Vickers-Koch search for an answer by looking at how the concept of core capabilities evolved as part of the discipline of strategic planning. They explore how the concept surfaced but remained dormant for a number of years, and then how and why many companies began to use it in the strategic task of finding the best fit between a firm's resources and external business conditions. Instead of just asking, ''What businesses are we in?'' and ''What businesses should we be in, given the changes taking place?'' these companies are paying more attention to the question, ''What capabilities do we need to develop and nurture to take full advantage of those changes?'' As markets fragment and proliferate, and product cycles move at ever faster speeds, a company's facility as a ''core capability builder'' becomes more critical. Long and Vickers argue that this is the best way to create an enduring competitive advantage.