Core which is Valuable, Rare, Costly to imitate

Core competency are the main strength of a business or company. Company may create a competitive advantage to be differentiate from its competitors in order stay in the marketplace. Core competency of an organization may includes skill, knowledge, experience in certain activity. In order to build or identify the core competency of an organization is to fulfill the specific criteria of sustainable competitive advantage which is Valuable, Rare, Costly to imitate and Non substitutable capabilities. If an organization has fulfill all this 4 criteria then its competitive advantage is very strong and powerful.The core competency of Perodua is produce compact car at the affordable price and easy accessible to Malaysian. Perodua possesses the 4 capabilities in its Affordable price of the products, Excellent reliable brand, Strong marketing and promotion and Company culture.  Affordable price of the products Price of the products and services are the primary requirement for low or medium income family or person to buy a vehicle. Perodua is using the low cost strategy to compete with other competitors. The strategy partnership with Daihatsu enable Perodua to manufacture a compact car with advanced technology at affordable prices such as Bezza and Myvi. Perodua have a good relationship with its suppliers which enable the Perodua to enjoy a low cost of raw materials or a great discount from its supplies. The price range for the Perodua various vehicle is from RM 24,000 to RM 65,000. As the majority of Malaysian are affordable with the car prices, Perodua had successfully gain a market share of 33.82%, its total sales is 184,707 units over the total industry volume of 521,907 units on last year. Hence, it is a sustainable competitive advantage for Perodua as it is valuable and rare because the prices offer by the Perodua is the lowest as compared with other competitors in Malaysia and it is also hardly to imitate since other brand vehicle with the similar vehicle feature, will costs double the money and no able to offer its product at cheaper price. This pricing advantage as compared to other competitors such as Toyota and Honda has attracted a lot of consumers.    Excellent reliable brandBesides that, Perodua Myvi currently been awarded a 5-star ASEAN NCAP Safety Rating with an overall score of 88.27 points and is higher than the Toyota Vios which was also be awarded a five-star rating by obtaining an overall score of 81.63 points.  Perodua has constantly improve its R&D skill and knowledge in order to manufactures a high quality of car with advanced technology . Recently, Perodua has improves its existing and add new safety features in its new vehicle, Myvi with the technical and technology support of Daihatsu. The probability of the Perodua vehicle being recall is the lowest, it is indicate that all the component, part, safety features, system and engine are in the good condition and properly equipped in the vehicle. The other competitors such as Toyota, Honda and Nissan are the top 10 most recalled car brand in local and Proton also have recall almost 100,000 units of its vehicle in 2016. Most of the car brand recall their vehicle is due to the air bags problems or others safety features in its vehicles. Thus, it is valuable and rare resources since the products of Perodua is excellent reliability and build its vehicle with high quality of safety feature. It is also difficult to imitate and without substitutes because most of competitors are facing with the high probability of vehicle being recall in the future which might affect their car brand name and reputation.    Strong marketing and promotion.Perodua also have strong promotion such as giving discount, cash rebates, free gifts . Besides that, Perodua often advertise its products in different types of media such as website, newspaper, television and use direct and personal selling strategy to promote their products and services. Perodua had launched its UFirst Website and UFirst Perodua Passport Mobile Application to offers information and other benefits. Perodua also work together with other group in other industries or other countries such as bank or financial institution to further promote its products and boost its sales. For example, Perodua Sales Sdn Bhd signed a five years agreement worth RM355 million with the PETRONAS Dagangan Bhd in order to get the supply of 17 million litres of higher grade engine oil from Petronas. Therefore, it is a valuable capabilities and is costly to imitate because for other competitors who has a low or moderate marketing skills will need to spend more times and money to imitate the strategy apply by the Perodua such as the partnership with Petronas, Perodua has consumer a huge amount of money. However, it is not rare and substitutable because some of the marketing strategy is very common and other competitors also can find alternative ways to compete with Perodua.    Company culture Perodua believe its employees is play an important role in achieving its goals. Perodua always encourage its employees to develop a new ideas and build a effective teamwork culture in the organization for greater efficiency and productivity. The culture will always motivate its employees to be more effective and efficiency in every activities they performed. In order to maintain this culture, Perodua have provide regular specialized training to its staffs in order to keep updating their knowledge and skill, give an attractive reward based on its staff performance and constantly upgrading its benefits such as raise its employee’s salary, medical incentives or bonus. Besides that, Perodua continuously provide a better working environment, new and advanced technology, facility and equipment for its employees to perform their task effectively and efficiency. Minorities are taking an important position in the organization which indicate that every staff in the organization will be given an equal opportunity for career advancement. This culture is also a valuable and rare resources, since the Perodua has taken many years to develop and accept this culture in the organization and it is difficult and costly to imitate by other competitors in the future. Core competencyValuableRareCostly to imitateNon-substitutableCompetitive ConsequencesPerformance ImplicationsAffordable price of the products ? ? ? XTemporary competitive advantageAverage returns to above-average returnsExcellent reliable brand????Sustainable competitive advantageAbove-average returnsStrong marketing and promotion ? ? X XCompetitive parityAverage returnsCompany culture????Sustainable competitive advantageAbove-average returns