in Organizations

Edge competencies

I’ve been thinking about how organizations today are more distributed and decentralized, relying on the performance at the interface to the customer. Compared to core competencies that power the creation of new products and live deep within the company, most companies have one or more particular capabilities that live at the fringes where organizations exert their last influence over performance before the consumer takes over. I’m starting to collectively refer to these capabilities as edge competencies (yes it’s a little jargony, but core capabilities probably was as well back in 1990).

For example, Coca-Cola’s core competency is the manufacture and distribution of nonalcoholic beverages, and their edge competency is how they create brands through marketing campaigns.

T-Mobile’s core competency is building telecommunications infrastructure, and their edge competency is the design of each customer-facing service.

The concept becomes interesting when you think about how executives crafting the organization’s strategy must align with one or two particular project teams doing tactical work (incidentally, I think the dichotomy of strategic and tactical is less useful in these situations, since the importance of edge project work can have deep importance to the organization).

There should also be a feedback loop between core competencies and edge competencies, so that customers are both informed and have a voice in crafting an organization’s work.

More to come…

Update: More is here… I’ve expanded this idea into an essay and renamed it Strategic Delivery Points to avoid any confusing comparisons between it and core competencies. Enjoy.

  1. This is a great point about “edge competencies”. Kind of like how FedEx and UPS are no longer exclusively parcel delivery services but global supply chain management services.

    In this era of globalization, outsourcing, insourcing and collaboration it would be wise for design firms and practices to discover their own “edge competencies” as well.

    Interaction design firms, print design firms, branding firms, etc. We may need to look beyond the deliverables we create and start focusing on the overall value we provide. As commoditization continues to erode the lower end of the design deliverable universe, we will need to seek higher ground and provide more cerebral “from the neck up” skills rather than production-oriented “from the wrists down” type of services.

    Great point. Can’t wait to read more!

    Chris

  2. Actually Coca-Cola Does not manufacture and distribution of nonalcoholic beverages, they produce the syrups that are needed so the bottler can manufacture the product. It could be argued that since some of the bottlers are owned by coke that this would still be a core competency yet i would say you are more on track with marketing.

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