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Flevy Management Insights Case Study
Core Competency Revitalization for Biotech Firm in Precision Medicine


There are countless scenarios that require Core Competencies. Fortune 500 companies typically bring on global consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture, or boutique consulting firms specializing in Core Competencies to thoroughly analyze their unique business challenges and competitive situations. These firms provide strategic recommendations based on consulting frameworks, subject matter expertise, benchmark data, best practices, and other tools developed from past client work. Let us analyze the following scenario.

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Consider this scenario: A life sciences company specializing in precision medicine is facing stagnation in its growth trajectory.

Despite being well-established, the organization is struggling to differentiate its offerings in a highly competitive market. With a focus on innovation and a rich history of pioneering treatments, the company now finds its core competencies diluted, as it has expanded into areas beyond its expertise. The leadership team is keen to realign the organization's strategic focus to its foundational strengths to regain its competitive edge and drive sustainable growth.



In light of the situation, the initial hypothesis is that the life sciences company's growth stagnation is due to a dilution of its Core Competencies, leading to a lack of competitive differentiation. Another hypothesis could be that there is an inefficient allocation of resources, pulling focus away from areas of true competitive advantage. Finally, a third hypothesis might consider whether the company's research and development pipeline has been misaligned with market needs and expectations.

Strategic Analysis and Execution Methodology

The adoption of a robust methodology to reassess and revitalize Core Competencies is essential. This structured approach not only identifies the unique strengths of the organization but also aligns them with market opportunities to create a strategic advantage. By adopting a methodology similar to those used in top consulting firms, the company can expect to achieve clarity, focus, and a refined strategic direction.

  1. Assessment of Current Core Competencies: This phase involves a thorough analysis of the company’s existing core competencies, market position, and competitive landscape. Key activities include interviews, surveys, and benchmarking against industry standards. The goal is to identify areas of true differentiation and those that are non-core.
  2. Market and Opportunity Analysis: This stage focuses on external market trends, customer needs, and potential areas for growth. It employs tools like PESTEL and SWOT analyses to map out opportunities that align with the company’s strengths.
  3. Strategic Realignment: Based on insights from the previous phases, this phase develops a strategic plan to refocus on core competencies that offer competitive advantage. It includes redefining the innovation pipeline and resource reallocation.
  4. Operational Execution: The implementation of the strategic plan, including changes to organizational structure, processes, and culture to support the realigned focus. Key performance indicators are established to measure progress.
  5. Sustained Performance Management: This final phase ensures the changes are deeply embedded in the organization, with continuous monitoring and adjustment as necessary. It includes leadership development and long-term strategic planning to maintain alignment with Core Competencies.

Learn more about Strategic Planning Performance Management Competitive Advantage

For effective implementation, take a look at these Core Competencies best practices:

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Leadership Competency Model (25-slide PowerPoint deck)
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Competency Model & Matrix Development (37-page Word document)
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Core Competencies Implementation Challenges & Considerations

Executives may question how the methodology ensures that the realigned core competencies will remain relevant in a rapidly evolving market. The process involves continuous monitoring and iterative strategic planning to adapt to changes. Another concern may be about the resource implications of such a strategic shift. A phased approach with clear milestones allows for managed resource allocation and minimizes disruption. Executives might also inquire about the employee impact and cultural changes. Addressing this, change management principles are embedded throughout the methodology to facilitate a smooth transition.

The expected business outcomes include a sharper strategic focus, improved competitive positioning, and accelerated growth. The organization should see increased innovation efficacy, with a 20% projected increase in R&D productivity. Operational efficiencies are also expected, potentially leading to a 15% reduction in non-core expenditures.

Potential implementation challenges include resistance to change, misalignment between departments, and underestimation of the required investment in change management. To mitigate these, transparent communication and stakeholder engagement are critical.

Learn more about Change Management Core Competencies

Core Competencies KPIs

KPIS are crucial throughout the implementation process. They provide quantifiable checkpoints to validate the alignment of operational activities with our strategic goals, ensuring that execution is not just activity-driven, but results-oriented. Further, these KPIs act as early indicators of progress or deviation, enabling agile decision-making and course correction if needed.


What gets measured gets managed.
     – Peter Drucker

  • R&D Productivity: Measures the output of the research and development team relative to investment.
  • Market Share Growth: Tracks the change in the organization's market share post realignment.
  • Employee Engagement Scores: Assesses how the changes affect employee morale and buy-in.

For more KPIs, take a look at the Flevy KPI Library, one of the most comprehensive databases of KPIs available. Having a centralized library of KPIs saves you significant time and effort in researching and developing metrics, allowing you to focus more on analysis, implementation of strategies, and other more value-added activities.

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Implementation Insights

During the implementation, it was observed that aligning Core Competencies with strategic growth initiatives led to a more motivated workforce. According to a McKinsey study, companies that align their employees with the strategic direction can see a 30% increase in operational performance. This alignment also facilitated a more efficient allocation of resources, emphasizing the importance of strategic focus in driving innovation and growth.

Core Competencies Deliverables

  • Core Competencies Assessment Report (PDF)
  • Strategic Realignment Plan (PowerPoint)
  • Operational Execution Framework (Excel)
  • Change Management Playbook (PDF)
  • Performance Management Dashboard (Excel)

Explore more Core Competencies deliverables

Core Competencies Best Practices

To improve the effectiveness of implementation, we can leverage best practice documents in Core Competencies. These resources below were developed by management consulting firms and Core Competencies subject matter experts.

Core Competencies Case Studies

One notable case study involves a pharmaceutical company that refocused its efforts on oncology, a core area where it had historical success. By divesting non-core segments and aggressively investing in oncology R&D, the company achieved a 25% increase in market share in its niche within three years.

Another case study highlights a medical device company that realigned its product development to leverage its core competency in minimally invasive surgical equipment. The result was a 40% increase in product adoption by healthcare providers, driven by a targeted and effective go-to-market strategy.

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Aligning Core Competencies with Evolving Market Needs

Ensuring that core competencies evolve with market needs is crucial for maintaining a competitive edge. A recent BCG report highlights that companies that periodically reassess and realign their core competencies with market trends can sustain revenue growth rates 1.5 times higher than those that do not. To achieve this, it is imperative to establish a dynamic strategic planning process that incorporates market intelligence and customer feedback loops. This enables real-time adjustments to the organization’s focus and resource allocation, ensuring that core competencies remain relevant and drive value creation.

Moreover, fostering a culture of agility and continuous learning can help organizations quickly adapt to changing market conditions. By empowering cross-functional teams to collaborate and innovate, companies can capitalize on emerging opportunities. This also involves investing in workforce capabilities to ensure that the skills and knowledge within the organization are aligned with its strategic priorities and the demands of the market.

Learn more about Value Creation Market Intelligence Revenue Growth

Resource Reallocation in Strategic Shifts

Resource reallocation can be a significant challenge when shifting strategic focus. According to McKinsey, dynamic reallocation of resources can contribute to a 2-3 times higher total return to shareholders. A disciplined approach to resource reallocation involves rigorous assessment of current investments and divestment of non-core assets, coupled with a clear-eyed view of future growth areas. This might include reallocating capital, talent, and R&D efforts towards core competencies with the highest potential for market differentiation and value creation.

Leaders need to ensure that the reallocation process is transparent and based on objective criteria to gain buy-in from stakeholders. Regular reviews of investment performance against strategic objectives allow for course corrections and reinforce the importance of agility in resource allocation decisions. This strategic agility can serve as a competitive advantage, allowing the organization to pivot quickly in response to market changes.

Change Management and Cultural Transformation

Change management is critical when realigning an organization’s core competencies. A study by Prosci indicates that projects with excellent change management are six times more likely to meet objectives than those with poor change management. This underscores the importance of a structured approach to managing the people side of change. Leaders should communicate the strategic rationale behind the shift, employ a transparent process for decision-making, and actively solicit feedback from employees at all levels of the organization.

Cultural transformation is often the linchpin of successful change management. It requires a clear articulation of the desired cultural attributes that support the new strategic focus. This could involve fostering a culture of innovation, resilience, and a customer-centric mindset. By aligning culture with strategy, organizations can enhance their execution capabilities and ensure that changes are sustainable over the long term.

Measuring the Impact of Core Competency Realignment

Measuring the impact of realigning core competencies is vital for understanding the effectiveness of the strategy and guiding future decisions. According to KPMG, 95% of successful businesses use key performance indicators (KPIs) to measure their strategy's effect. Relevant KPIs might include innovation success rate, customer satisfaction scores, and financial metrics such as EBITDA growth. These indicators should be reviewed regularly to assess whether the strategic shift is delivering the expected benefits and to identify areas for improvement.

Additionally, qualitative measures such as employee engagement and customer feedback can provide valuable insights into the impact of the changes. These measures help gauge the internal and external perceptions of the company’s strategic realignment and can inform adjustments to the strategy and execution plans. By taking a holistic approach to measurement, leaders can ensure that the organization remains on track to achieve its strategic objectives.

Learn more about Employee Engagement Customer Satisfaction Key Performance Indicators

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Key Findings and Results

Here is a summary of the key results of this case study:

  • Realigned core competencies to focus on precision medicine, leading to a 25% increase in market share within the first six months post-implementation.
  • Increased R&D productivity by 18% through strategic realignment, resulting in a higher innovation efficacy and accelerated time-to-market for new treatments.
  • Implemented operational efficiencies, resulting in a 12% reduction in non-core expenditures, surpassing the projected 15% target.
  • Improved employee engagement scores by 15%, indicating a positive impact on workforce morale and alignment with the strategic direction.

The initiative has yielded significant successes, particularly in realigning core competencies to focus on precision medicine, resulting in a substantial increase in market share and enhanced R&D productivity. These outcomes are indicative of successful strategic realignment, as evidenced by the tangible improvements in market performance and internal operational efficiencies. However, the initiative fell short of the projected 15% reduction in non-core expenditures, achieving a 12% reduction. This discrepancy may be attributed to unforeseen operational complexities or resistance to change within certain departments. To enhance outcomes, a more comprehensive change management strategy and targeted department-specific realignment plans could have been beneficial. Additionally, while the increase in R&D productivity is commendable, further analysis is needed to identify the specific drivers of this improvement and ensure its sustainability. Moving forward, a more nuanced approach to resource reallocation and a continuous review of the realignment's impact on various departments could further optimize the initiative's outcomes.

Building on the initiative's successes, the company should consider refining its resource reallocation strategy to ensure a more seamless transition and mitigate potential resistance to change. This could involve a more granular assessment of department-specific needs and a phased approach to reallocation, allowing for targeted support and minimizing disruption. Additionally, ongoing monitoring and refinement of the realignment's impact on R&D productivity and operational efficiencies will be crucial to sustaining and enhancing the initiative's outcomes. Furthermore, a comprehensive change management plan, tailored to address department-specific challenges and foster a culture of agility and continuous learning, should be prioritized to support the ongoing realignment efforts. By incorporating these recommendations, the company can build on its current successes and further solidify its position as a leader in precision medicine.

Source: Core Competency Revitalization for Biotech Firm in Precision Medicine, Flevy Management Insights, 2024

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