Rita McGrath

Defining and Developing Competence: A Strategic Process Paradigm

Coauthor(s): Ian MacMillan, S. Venkataraman.

Abstract:
In this paper, competence is defined in operational terms as the degree to which the firm or its subunits can reliably meet or exceed objectives. Two antecedents to competence (and thus competitive advantage) are then developed and defined. These are the "comprehension" of the management team working on developing competence and the "deftness" of their task execution. Empirical results from a study of 160 new initiatives in 40 organizations from 16 countries suggest that: (1) it is feasible to operationalize and measure these constructs; (2) comprehension and deftness are important correlates of an organization's degree of competence as defined; and (3) a process-centered paradigm for understanding competence development shows promise.

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