The Difference Between a Core Competence and a Distinctive Competence

question 33

Multiple Choice

The difference between a core competence and a distinctive competence is that

• A) a distinctive competence refers to a company's strongest resource or competitive capability and a core competence refers to a company's lowest-cost and most efficiently executed value-chain activity.
• B) a core competence usually resides in a company's base of intellectual capital whereas a distinctive competence stems from the superiority of a company's physical and tangible assets.
• C) a core competence is a competitively relevant activity which a firm performs especially well in comparison to the other activities it performs, whereas a distinctive competence is a competitively relevant activity which a firm performs especially well in comparison to other firms with which it competes.
• D) a core competence represents a resource strength whereas a distinctive competence is achieved by having more resource strengths than rival companies.
• E) a core competence usually resides in a company's technology and physical assets whereas a distinctive competence usually resides in a company's know-how, expertise, and intellectual capital.

Evaluate different leadership styles and their effectiveness in various organizational contexts.

Critically analyze sociological theories and research findings, including their implications and criticisms.

Understand the composition and calculation of a company's cash receipts and payments.

Calculate and interpret the effective annual rate (EAR) of trade credit and bank loans.

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Definitions:

Noncash Assets

Assets that are not in the form of cash or easily convertible into cash, such as real estate, equipment, and patents.

Capital Deficiency

A situation where a company's liabilities exceed its assets, indicating financial distress.

Income Ratio

A financial metric that compares different types of income to a common base, such as net income to sales, to evaluate financial performance.

Cash Distribution

The process of distributing or paying out cash from a corporation to its shareholders, often in the form of dividends.