ORGANIZATIONAL CORE COMPETENCE AND COMPETITIVE ADVANTAGE
CHAPTER ONE
INTRODUCTION
1.1 Background to the Study
The challenging environments we have today have imposed on the improvements organizations not only for competition, but in order to keep going and stay in the market. Various researchers have agreed that higher in performance is a product of the process of formulating a strategy through which the organization seeks to achieve its mission and objectives at the end. As a result of this, the successful performance also depends on the existence of the skills and capabilities of each individual organization, pointing to the fact that an appropriate and use of information technology by the organization may be crucial in the promotion of organizational performance (Bharadwaj, 2000; Ray, Muhanna, and Barney, 2005). Core competence is thought play an important role in the process of creating synergy between the strategic business units especially in a large organisation like PZ Cussons Nigeria Plc. Therefore, the experimental results of the core competence are to obtain confirms the superiority of competitive performance (Besle and Sezerel, 2012).
organizational performances defined is a final result of a work include many factors like: communication, job
processes, team, interaction, corporate culture, commitment, climate for innovation, satisfaction, loyalty and business
environment (Lia, et al., 2006).
Nowadays, banking sector has gain large importance, especially when compared with other sectors like
manufacturing sector which PZ Cussons Nigeria Plc is included. Because of the diversity and multiplicity of services
provided to the public and its contribution to the economic growth of the country. According to report of Central Bank
of Iraq (CBI), 2012), there are 23 private banks licensed to work in Iraq. The private banks of this study are includes
Baghdad Bank, Commercial Bank of Iraq, Iraqi Middle East Investment, Investment Bank of Iraq, United Bank for
Investment, Dares Salaam Investment Bank and the likes.
Core competencies should be built upon organizational capabilities, and resources. Gaining superiority in a
competitive market depends on a firm’s ability to identify, develop, deploy, and preserve particular resources that
distinguish it from its rivals (Carmeli, Tishler, 2004). Capabilities-based competition means the consistency of firm’s
product quality, the insight into evolving customer needs, the ability to exploit emerging markets, enter new
businesses, or generate new ideas and incorporate them in innovations (Stalk et al., 1992). Capabilities are
considered to be the organisation’s ability to make use of its resources (Torkkeli, Tuominen, 2002). Capabilities make
the difference in using resources. Hence, a company determines what skills or capabilities will make them unique in
the future (Hamel, Prahalad, 1994). For example, the secret of Wal-Mart’s success against its rival, Kmart, which is
once an market leader in retailing industry, is a relentless focus on satisfying customer needs, gaining the full benefits
of cross-docking, and finally, its human resource system (Stalk et al., 1992). It is against this background that this
study seeks to investigate organizational core competence and competitive advantage by using study of PZ Cussons Nigeria Plc.
1.2 Statement of the Problem
Skills and tactic knowledge which are core competence of an organization are used to develop competitive strategies
that are unique to an organization. Hence, core competence has given significant contribution to the end product,
provided access to more than one market, and has become difficult for competitors to imitate. PZ Cussons Nigeria Plc
gain competitive strategies as the impacts of specialization in the organisation. Core competence is a concept used in
explaining collaborative efforts in organisation to be initiative which co-oversee the activities of different persons in an
organization with diverse skills and capabilities.
In such competitive environment, organisations are making use of different strategic tools to gain market leadership in
order to gain competitive advantage. Some organisations like PZ Cussons Nigeria Plc are going back to enhance
their internal processes and capabilities in a bid to make them more consistent and efficient by improving their
products. Core competencies are very important to PZ Cussons Nigeria Plc to counter competitors’ strategies. How
the organisation utilizes its core competencies to large extent determines the eventual organizational performance.
The search for competitive advantage largely borders customers’ appreciation of organisational value addition and
their comparisons among the available products and service. Therefore it becomes necessity for PZ Cussons Nigeria
Plc management to assess its core competencies. However, none of these studies focused on manufacturing industry
like PZ Cussons Nigeria Plc to determine how the organisation has entrenched the core competence concept, its
operations and processes. There is need to critically investigate organizational core competence and competitive
advantage in the manufacturing industry like PZ Cussons Nigeria Plc.
1.3 Research Objectives
The general objective or main objective of this study is to investigate organizational core competence and competitive
advantage by using study of PZ Cussons Nigeria Plc. The specific objectives are:
i) To investigate the effects of organizational core competence on their competitive advantage
ii) To examine the reasons why PZ Cussons Nigeria Plc engage in organizational core competence for
competitive advantage
iii) To determine the prevalence of organizational core competence and competitive advantage in PZ Cussons Nigeria Plc
1.4 Research Questions
The following are some of the questions which this study intends to answer:
i) What are the effects of organizational core competence on their competitive advantage?
ii) What are the reasons why PZ Cussons Nigeria Plc engages in organizational core competence for
competitive advantage?
iii) To determine the prevalence of organizational core competence and competitive advantage in PZ Cussons
Nigeria Plc?
1.5 Research Hypotheses
The following hypotheses were postulated to guide the conduct of this study;
i) Core Competence does not affect the Competitive Strategy
ii) Core Competence does not affect the Corporate performance
ORGANIZATIONAL CORE COMPETENCE AND COMPETITIVE ADVANTAGE