Critical Success Factors and Core Competencies

Critical Success Factors and Core Competencies

Helena Santos Rodrigues (Instituto Politécnico de Viana do Castelo, Viana do Castelo, Portugal and Escola Superior de Techologia e Gestaõ) and Pedro Figueroa Dorrego (Universidade de Vigo, Pontevedra, Spain)
Copyright: © 2008 |Pages: 5
DOI: 10.4018/978-1-59904-885-7.ch048
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To effectively compete, the company needs to adjust their internal strengths to the environmental opportunities. Considering the “intangible” support of virtual organizations, it point out the importance of intangible resources. So, managers need to identify, combine, recombine, and manage their resources, competencies and capability to explore their potential and perform better than the competitors on the costumer needs, preferences, and desires satisfaction. So, the advantage of an organization consists in the identification of the internal: core competences, mainly based on knowledge assets and intellectual capital, that align with the key success factors of the market gives: competitive advantage, better performance and better market position.

Key Terms in this Chapter

Critical Success Factors (CSF): Aptitudes, or means, that are critical to achieve a better market performance from costumer point of view. Those factors most valued by costumers can be: characteristics of a product, services, post purchase support, and so forth.

Relational Capital: The “combination of knowledge which is incorporated in the organization and people, as a consequence of the value derived from the relationships which they maintain with market agents and with society in general” (C.I.C., 2003, p. 136) It is the individual knowledge of the channels, clients and suppliers, or the knowledge impact of the governmental or industrial associations (Bontis, 1999). Often this element of the intellectual capital is forgotten because is the most difficult to identify and develop; is external to organization; and, is referent to capital fitted on external relations of the firm. But is very important to identify, as Bontis (1999) point out, it refer to the understanding of what a client wishes from our product or service. It makes the difference between a position of leadership or follower.

Human Capital: Roos et al. (1997) describe human capital as the company soul. It is referent to people as source of organizational wealth. Constitutes the individual capacities, knowledge, skills and experience of the employees and directors (Edvinsson & Malone, 1997), is the source of innovation and strategic renovation (Stewart, 1998). Although is difficult to codify, identify and to valuate (Bontis, 1996) is considered the pillar of all value creation activities (Edvinsson & Malone, 1997), it essence is the intelligence escarped on the firm members (Bontis, 1999).

Organizational Knowledge: The organizational knowledge is created and transferred within the organizational context, is rooted in: (1) company and industrial atmosphere (King & Zeithaml, 2003), (2) tacit knowledge (Grant, 2002); and is fitted in firm culture (Saint-Onge, 1996). Has the following properties: (1) is shared between the members of the organization (2) is connected to organization history, and (3) allows a common language.

Structural Capital: The organizational capacity to transmit and store intellectual material (Edvinsson & Malone, 1997). Is the representation of existing organizational knowledge that is property, and has a resident character, since, it remain in the organization independently of the permanence of the people (C.I.C., 2003). It is the knowledge, abilities, experiences, and information, institutionalized, codified, and used through patent, data bases, manual, structure, system, mechanisms, routine and process that can support employees in the search of intellectual performance (Bontis, 1999; Youndt et al., 2004). Never the less is the infrastructure that incorporates, enables and maintains human capital (Edvinsson & Malone, 1997).

Core Competencies: Knowledge, competences, aptitudes, managerial techniques, and so forth. of an organization that permits a better market performance, respected competitors, and originate a competitive advantage. The companies need to know their most valuable factors, those that are superior from the competitors. Not all factors are critical; they must be unique, inimitable, belong to the firm, perceived by clients and effectively differentiate the company from the competitors.

Capital Intellectual: Commonly considered as the sum of knowledge and knowing capabilities that can be utilized to give a company competitive advantage (Nahapiet & Ghoshal, 2002; Stewart, 1998; Youndt, Subramaniam, & Snell, 2004); or as the “knowledge that can be turned value” (Leif Edvinsson & Sullivan, 1996: 358). Brooking (1996) defines it as the combination of immaterial assets that allow the operation of the organization. It’s accepted and generalized the consideration of tree elements: human capital, structural capital and relational capital.

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