Core competencies are the crown jewels of a company and, therefore, should be carefully nurtured and developed. Companies can determine their future business directions based on the strengths of competencies. However, because generalized terms such as resource, asset, capability, and competence are not clearly explained in connection with competence theory, these posing difficulties in understanding many contemporary management concepts. In this paper, the authors provide a summary of the recent management theories by comparing their salient features. They then propose a linking mechanism between assets, resources, capabilities, competencies, and core competencies. They provide a methodology to identify core competencies by isolating unique and flexible capabilities of the firm. They use this framework to identify the core competencies of a UK manufacturing company. The results of their analyses are used to help the company to make more informed strategic management decisions regarding capability development, outsourcing, focusing, or diversification, with regards to new products, services, or markets. The framework is generic in nature and is applicable to benchmark a manufacturing, public, or service sector organization.
Hafeez et al. (2002) studied this question.