FINAL YEAR PROJECT

EFFECT OF CORE COMPETENCE ON COMPETITIVE ADVANTAGE AND ORGANIZATIONAL PERFORMANCE

PRESENTED BY:
SYED AKBAR RAZA
SUPERVISOR: SIR MICHAEL SIMON

INTRODUCTION

The concept of core competence has implications at the

strategic level as the firms should systematically work
upon identifying their core competencies and developing
them for sustainable competitive advantage.

OBJECTIVES
To examine the effect of core competence on competitive
advantage variables in the pharmaceutical industry of
Karachi.
To test the effect of competitive advantage on the
organizational performance of the pharmaceutical industry
of Karachi.
To investigate the effect of core competence on the
organizational performance of the pharmaceutical industry
of Karachi.

RESEARCH METHODOLOGY
RESEARCH DESIGN:
Quantitative research.

PROCEDURE:

Questionnaire survey .

RESEARCH METHODOLOGY
POPULATION:

The managers and medical reps of Novartis, GSK and Abbott of Karachi.

The total population is 1500 employees working in Novartis, GSK and

Abbott of Karachi. .

SAMPLE SIZE AND SAMPLE METHOD:

Sample size is 150
Sampling method is convenience sampling

VARIABLES
INDEPENDENT VARIABLES:

Core competence
Competitive advantage

DEPENDENT VARIALBE:

Competitive advantage
Organizational Performance

THEORETICAL FRAMEWORK
CORE
COMPETENCE
ORGANIZATIONAL
PERFORMANCE
COMPETITIVE
ADVANTAGE

HYPOTHESIS
Following are the hypothesis developed for testing:

H1: Core Competence has positive effect on

Organizational Performance.

H2: Core Competence has positive effect on

Competitive Advantage

H3: Competitive advantage has positive effect on

Organizational Performance.

REGRESSION ANALYSIS OF
OVERALL ORGANIZATION

REGRESSION ANALYSIS OF CORE COMPETENCE ON ORGANIZATIONAL PERFORMANCE:

Model Summary

Model
1

R Square

Adjusted R
Square

.714a

.510

.499

Std. Error of the

Estimate
.26563

a. Predictors: (Constant), Empowerment, Shared Vision, Cooperation

INTERPRETATION:

Now looking at the regression table, in which the

value or R square is .510 which indicates that 51%
of variation in Organizational Performance can be
explained by the Core Competence.

REGRESSION ANALYSIS OF COMPETITIVE ADVANTAGE ON ORGANIZATIONAL PERFORMANCE:

Model Summary

Model
1

R Square

Adjusted R Square

Std. Error of the

Estimate

.421a

.178

.166

.34281

Predictors: (Constant), Responsiveness, Flexibility

INTERPRETATION:

Now looking at the regression table, in which the

value or R square is .178 which indicates that 17.8%
of variation in Organizational Performance can be
explained by the Competitive Advantage.

REGRESSION ANALYSIS OF CORE COMPETENCE ON COMPETITIVE ADVANTAGE:

Model Summary

Model
1

R Square
.506a

.256

Adjusted R
Square
.240

Std. Error of the

Estimate
.24649

Predictors: (Constant), Empowerment, Shared Vision, Cooperation

INTERPRETATION:

Now looking at the regression table, in

which the value or R square is .256 which
indicates that 25.6% of variation in
Competitive Advantage can be explained
by the Core Competence

REGRESSION ANALYSIS
OF INDIVIDUAL
ORGANIZATION
REGRESSION ANALYSIS OF ABBOTT

REGRESSION ANALYSIS OF CORE COMPETENCE ON ORGANIZATIONAL PERFORMANCE

Model Summary

Model
1

R Square

Adjusted R
Square

.636a

.405

.363

Std. Error of the

Estimate
.33261

Predictors: (Constant), Empowerment, Shared Vision, Cooperation

INTERPRETATION:

Now looking at
which the value
indicates that
Organizational
explained by the

the regression table, in

or R square is .405 which
40.5% of variation in
Performance
can
be
Core Competence.

REGRESSION ANALYSIS OF COMPETITIVE ADVANTAGE ON ORGANIZATIONAL PERFORMANCE

Model Summary

Model
1

R Square

Adjusted R
Square

.345a

.119

.078

Std. Error of the

Estimate
.40006

Predictors: (Constant), Responsiveness, Flexibility

INTERPRETATION:

Now looking at the regression table, in

which the value or R square is .119 which
indicates that 11.9% of variation in
Organizational
Performance
can
be
explained by the Competitive Advantage.

REGRESSION ANALYSIS OF CORE COMPETENCE ON COMPETITIVE ADVANTAGE

Model Summary

Model
1

R Square

Adjusted R
Square

.477a

.228

.172

Std. Error of the

Estimate
.25578

Predictors: (Constant), Empowerment, Shared Vision, Cooperation

INTERPRETATION:

Now looking at the regression table, in which the

value or R square is .228 which indicates that
22.8% of variation in Competitive Advantage can
be explained by the Core Competence.

REGRESSION ANALYSIS OF GSK

REGRESSION ANALYSIS OF CORE COMPETENCE ON ORGANIZATIONAL PERFORMANCE

Model Summary
Model
1

R
R Square
.756a
.572

Adjusted R
Std. Error of
Square
the Estimate
.540
.24261

Predictors: (Constant), Empowerment, Shared Vision,

Cooperation
INTERPRETATION:

Now looking at the regression table, in which

the value or R square is .572 which indicates
that 57.2% of variation in Organizational
Performance can be explained by the Core
Competence.

REGRESSION ANALYSIS OF COMPETITIVE ADVANTAGE ON ORGANIZATIONAL PERFORMANCE

Model Summary

Model
1

R
.450a

R Square
.203

Adjusted R
Square

Std. Error of the

Estimate

.164

Predictors: (Constant), Responsiveness, Flexibility

INTERPRETATION:

Now looking at the regression table, in

which the value or R square is .203
which indicates that 20.3% of variation
in Organizational Performance can be
explained
by
the
Competitive
Advantage.

.32701

REGRESSION ANALYSIS OF CORE COMPETENCE ON COMPETITIVE ADVANTAGE

Model Summary

Model
1

R Square

Adjusted R
Square

.481a

.232

.174

Std. Error of the

Estimate
.26694

Predictors: (Constant), Empowerment, Shared Vision, Cooperation

INTERPRETATION:

Now looking at the regression table, in which

the value or R square is .232 which indicates
that 23.2% of variation in Competitive
Advantage can be explained by the Core
Competence.

REGRESSION ANALYSIS OF
NOVARTIS

Regression Analysis of Core Competence on Organizational Performance:

Model Summary

Model
1

R Square
.767a

.588

Adjusted R
Square
.566

Std. Error of the

Estimate
.23340

a. Predictors: (Constant), Empowerment, SharedVision, Coopertation

INTERPRETATION:

Now looking at the regression table, in which the value

or R square is .588 which indicates that 58.8% of
variation in Organizational Performance can be
explained by the Core Competence.

Regression Analysis of Competitive Advantage on Organizational Performance:

Model Summary
Adjusted R Std. Error of the
Model
R
R Square
Square
Estimate
1
.470a
.221
.194
.31807
a. Predictors: (Constant), Responsiveness, Flexibility

INTERPRETATION:

Now looking at the regression table, in which the

value or R square is .221 which indicates that 22.1%
of variation in Organizational Performance can be
explained by the Competitive Advantage.

Regression Analysis of Core Competence on Competitive Advantage:

Model Summary
Adjusted R
Std. Error of the
Model
R
R Square
Square
Estimate
1
.558a
.311
.274
.23836
a. Predictors: (Constant), Empowerment, Shared Vision, Cooperation

INTERPRETATION:

Now looking at the regression table, in which the value or

R square is .311 which indicates that 31.1% of variation in
Competitive Advantage can be explained by the Core
Competence.

CONCLUSION

This study provides initial empirical evidence of the

relationship
between
core
competence
and
organizational performance.

Core competencies are key component in enhancing

the organizational performance.

CONCLUSION

The results of the regression analysis provide support

for the three hypothesized relationships. Consistent
with H1, that core competence dimensions shared
vision, cooperation and empowerment has a
significant
positive
effect
on
Organizational
Performance.

In accordance with H2, there is 0.178 variation on

competitive advantage due to core competence which
is very low. For H3 there is 0.256 variation on
organizational performance due to competitive
advantage which is also very low.

RECOMMENDATION

The study provides empirical evidence of the effect of

core competence on organizational performance.
Therefore, pharmaceutical industry managers can use
the current findings to develop strategies that
enhance organizational performance.

Taking the results in account the managers should

focus on creating core competence within the
organization to create competitive edge. This is one of
the variables that are not focused by organizations in
Karachi as showed by empirical evidence. Creating
this variable the managers will automatically increase
their competitive advantage which is a general
assumption.

THANK YOU