Jim Collins, in his book “Good to Great”, calls core competency as “a simple crystalline that flows from deep understanding about the intersection of three key dimensions:
- What you can be best in the world at;
- What drives your economic engine; and,
- What you are deeply passionate about.”
Nike’s exit from the Golf equipment business (http://www.golfdigest.com/story/nike-exiting-golf-club-business-to-focus-on-footwear-apparel) to focus on footwear and apparel, is a clear indication that one of the world’s most valuable sports brand knows its core competencies and have every intention in sticking to the things where they are one of the, if not the, best at.
This attitude and focus shows why Nike is not just a good company but a great one. And we can take a couple of lessons from the news.
- Go for Lean and Hungry over Fat and Greedy. While expanding one’s business is not always a bad idea, it is always a better idea to not lose sight of the part of your business that you can be the best in the world at (your core competency) and stick to your guns with them.
- Good to have but not Crucial to have. Never be afraid of exiting the parts of your businesses that’s not part of your core competency. These parts should be treated as bonus (as long as they serve you and your assessment about this should be ruthless) and not interpreted as a crucial part of your business.
Finally had it right when he said in the article “They’re killing it in apparel. They’re killing it in footwear. It’s just business.”
Never lose sight of your Business (with a capital B for core competency).
As Entrepreneur It’s important that we know these 3 core dimension for your business so that when there’s a need to innovate or try another path, we are still on top of things.