What Is Distinctive Competence?
Distinctive competence refers to a superior characteristic, strength, or quality that distinguishes a company from its competitors. This distinctive quality can be just about anything—innovation, a skill, design, technology, name recognition, marketing, workforce, customer satisfaction, or even being first to market.
Via distinctive competency, a company can provide a premier value to customers. This unique aspect of the company, product, or service is difficult to imitate by the competition and creates a strong competitive advantage.
What’s the Difference Between Distinctive and Core Competence?
Whatever it is that a company does well can be described as a competency. Companies need at least one to stay in business, and they often have more than one.
But what’s the difference between distinctive and core competency?
In a single word, distinctive. A superior characteristic that is unique, special, or differentiating for a company is a distinctive competence. Customers identify that unique characteristic solely with a particular company or brand and are drawn to that company–or remain loyal–because of it. Distinctive competence is a difficult-to-imitate characteristic, strength, or quality. As a result, distinctive competence gives a company a competitive advantage. No one else can recreate it quite the same.
Leigh Richards of bizfluent explains the difference:
“A distinctive competency is any capability that distinguishes a company from its competitors. While a distinctive competency can be any competency, core or otherwise, it is typically a core competency that truly distinguishes a company from the rest of the competition.”
Core competence refers to anything that a company does well and is critical to a company’s value-generating activities and overall business performance. This characteristic isn’t necessarily distinctive, however. Likely all competitors in that particular market share the same core competence. So it doesn’t set any of the companies in that space apart.
Why Distinctive Competency Is Important
To be successful in the short- and long-term, companies need both core and distinctive competencies.
Distinctive competencies enable companies to:
- Increase competitive advantage
- Improve customer delight and loyalty
- Stand apart from competitors
- Be difficult to imitate
- Strengthen strategy
Distinctive competence isn’t set in stone, however. Changes and trends in the market will inevitably impact competencies. As a result, companies that build and reconfigure distinctive competencies are poised for long-term success in an ever-changing marketplace and world.
Examples of Distinctive Competence
Let’s look at two highly recognizable examples of distinctive competence: Amazon and Google.
Name recognition is an obvious distinctive competence for both companies.
To realize its mission of being “earth’s most customer-centric company,” Amazon cultivates distinctive competencies that create excellent customer experiences, such as fast delivery and superior customer service. In addition, the company’s distribution and workforce are also distinctive competencies.
In addition to name recognition, Google’s status as the most widely recognizable search engine serves as a distinctive competency. Its wide recognition and acceptance with users have, in fact, turned the company name into a verb (a process called anthimeria).
See Also: Incremental Innovation, Customer Experience, Product Differentiation, Product Design, User Experience, Product-Led Growth.