||The term “core competence” was used by Prahalad and Hamel to discuss the competition between the firms and how to acquire the sustainable competitive advantage in 1990. Afterward there generalized items such as capability, key capability, competence, and core competence are not clearly explained in the past, there is difficulty in understanding many contemporary management concepts. Using this study definition, conceptual framework is presented showing relationships between capability, key capability, competence, and core competence. This study shows how to identify key capabilities from capabilities by evaluating the attribute, importance; identify competencies from key capabilities by evaluating the attributes, ‘rareness,’ ‘inimitability,’ and ‘non-substitutability’; and how to further determine core competencies by evaluating the attributes, ‘product extension’ and ‘cultivate the new capability that can develop the new product and enter a new market’.
This study shows that the core competence could be divided into 4 dimensions of core competence by using factory analysis; that is, ‘product, process, and technological innovation and improvement,’ ‘the professional skills and knowledge, and execution,’ ‘resources integration,’ and ‘brand image.’ The indicators of ‘product, process, and technological innovation and improvement’ dimension are: ‘product development,’ ‘innovation or update of technology,’ ‘improvement of manufacture process,’ ‘improvement of technology,’ and ‘products innovation.’ The indicators of ‘the professional skills and knowledge, and execution’ dimension are ‘execution’ and ‘the professional skills and knowledge’. The indicators of ‘resources integration’ dimension are: ‘financing,’ ‘excellent management system,’ and ‘decision-making’. The indicators of ‘brand image’ dimension are: ‘brand awareness’, and ‘enterprise image’. Taiwan manufacturing companies could depend on these 12 indicators of four dimensions to build their core competence.