What Are Distinctive Competencies?

A red pushpin standing out against many white pushpins, representing distinctive competencies.

4-minute read

Distinctive competencies are unique attributes that companies do not share with their competitors. We explore what makes distinctive companies unique, how they can set companies apart, and unique tips to help you find your company’s distinctive competency.

What skill would you showcase if you were asked to perform in a talent show? Chances you’d pick a skill you can do better than anyone else in the room. (There’s no better time to debut your breakdancing skills to the world!) Just like people, companies have special talents, too. We know them as distinctive competencies. In this article, we’ll define distinctive competencies, explain how they differ from core competencies, and share a strategy you can use to find what sets your company apart.

Are you ready to showcase your company’s distinctive competencies? Let’s get started. You can also skip to the section you’re most interested in:

What is a distinctive competency?

Distinctive competencies are the unique attributes your organization has developed that distinguish it from peers or competitors in the market. They enable companies to deliver value to their markets. Distinctive qualities can include products, innovations, technologies, branding (such as name recognition), customer satisfaction, or many other attributes. A distinctive competency is something that your company excels in, that no one else in your market is doing, and that can’t be easily replicated.

What’s the difference between a distinctive competency and a core competency?

Although they are similar concepts, there is an important difference between distinctive competencies and core competencies. They are competencies that set your company apart. These characteristics, qualities, or features are unique to your company and difficult to imitate. That uniqueness turns distinctive competencies into competitive advantages for your company.

On the other hand, core competencies are areas where your company excels but are common among your competitors. These might be things that you do well or that deliver value for your customers. Competitors might share one core competency that is essential to their market but is not unique to any one company. 

Why are distinctive competencies important?

Distinctive competencies are important because they enable companies to address market problems, satisfy customer needs, and set themselves apart in the marketplace more effectively. Gathering data about the market’s needs and the company’s strengths gives insight into what customers truly value from that company and enables the company to position itself competitively in the marketplace. 

Companies can benefit from them in several ways:

  • Competitive Advantage: Setting your company apart with unique offerings that are hard for competitors to replicate.
  • Strategic Focus: Directing resources towards areas with the highest potential for excellence and customer value.
  • Improved Value Proposition: Enhancing customer value through innovation, quality, efficiency, or service.
  • Customer Loyalty: Building loyalty by consistently leveraging unique strengths.
  • Brand Recognition and Equity: Strengthening brand identity and equity as customers associate your brand with its unique attributes.
  • Higher Barriers to Entry: Protecting market position by making it difficult for competitors to match your core capabilities and compete in the market. 
  • Expansion and Diversification: Facilitating entry into new markets and product diversification by capitalizing on core strengths.

How do you find your company’s distinctive competency?

To find your company’s distinctive competency, start with a team brainstorm. Then, use the PRIME method to understand your company’s Purpose, Reputation, Innovation, Methods, and Expertise. 

  • Purpose: Successful companies are purposeful and market-centers. They want to solve their customers’ problems, which translates into value for their stakeholders. What is your company’s purpose? 
  • Reputation: Consider your reputation in your market. Does your market want to solve a particular problem or offer a specific solution? What do customers expect from your brand? 
  • Innovation: Innovation brings new ideas or solutions to existing markets or applies better solutions that meet new requirements. Innovation might encompass new technologies, delivery models, pricing, packaging, methodologies, or services. It could also reflect a new way of thinking about an old concept. What innovative ideas has your company come up with? What unique perspectives do you have?
  • Methods: Methods include procedures, techniques, and practices that help scale a solution or an organization. They ensure consistency across the organization and within the customer base. What systems and methods does your company consistently leverage to create solutions for customers, increase production, or decrease costs? Do you have any exclusive or proprietary methods that set you apart? 
  • Expertise: Experts possess comprehensive and authoritative knowledge, skills, or thought leadership in a particular area. Can your company deliver exclusive expertise? Is the expertise represented across the organization or within a few team members?

You can use the PRIME method to align core competencies and identify distinctive competencies unique to your company. Then, validate your findings with buyer interviews. Remember, distinctive competencies only matter if your customers see them, too. 

Real-world examples

Apple’s distinctive competency is its product design and technological innovation. When it first debuted in the market, Apple products like Mac computers, iPods, and iPhones were aesthetically different from other options on the market at the time. Apple’s operating system and seamless hardware and software integration create a consistent user experience across devices. Users can seamlessly transition between their iPhones, iPads, and MacBooks and upgrade their devices without disruption. This experience is unique to Apple and challenging for competitors like Google or Samsung to replicate. It also creates loyalty among Apple users who are navigating between and upgrading devices.

 Patagonia’s commitment to environmental sustainability and ethical manufacturing distinguishes it from competitors within the apparel industry. Their dedication to responsible practices appeals to a growing consumer segment that considers environmental concerns and corporate responsibility when purchasing. 

Author

  • Pragmatic Editorial Team

    The Pragmatic Editorial Team comprises a diverse team of writers, researchers, and subject matter experts. We are trained to share Pragmatic Institute’s insights and useful information to guide product, data, and design professionals on their career development journeys. Pragmatic Institute is the global leader in Product, Data, and Design training and certification programs for working professionals. Since 1993, we’ve issued over 250,000 product management and product marketing certifications to professionals at companies around the globe. For questions or inquiries, please contact [email protected].

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