Study on Core Competence and the Relationship between Core Competence and Performance in China's Industries

This paper attempts to contribute to the understanding of core competence of corporate. A hypothesis is developed that core competence is specified as a second-order factor of marketing capabilities, process capabilities, and learning/innovation capabilities dimensions, which are to be synergizes and co-aligned. Another hypothesis is developed concerning the positive relationships between core competence and finance performance. To test these hypothesizes, a structural equation model is applied to questionnaire survey data from 152 companies. The study found the existence of core competence as a second-order of marketing capabilities, process capabilities, and learning/innovation capabilities. As hypothesized, the results also revealed the existence of a significant and positive association between core competence and finance performance.