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A Distinctive Capability, also referred to as a Core Competence, is a unique ability or resource that an organization possesses that allows it to excel in a particular area or to perform a specific task better than its competitors. It is something that differentiates the organization from others in the market and gives it a unique Competitive Advantage.
Distinctive Capabilities can include a wide range of resources and abilities, such as specialized knowledge, expertise, technology, processes, or organizational structures. They are often developed over time through a combination of investments in research and development, training and development of employees, and other efforts to build and maintain a competitive edge.
In Corporate Strategy, an organization's Distinctive Capabilities are often considered key drivers of sustainable growth and success—and are used to inform its competitive market positioning. This is the foundation to Capabilities-driven Strategy (CDS).
Through extensive research into the origin of corporate and industrial success, John Kay posited there are types of Distinctive Capabilities:
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