What it is for

• To find what a firm is actually chosen for — not what it is proud of, and not a list of strengths.
• The near end is a structure — core competences built from competences, competences built from the root-cause resources and capabilities that actually caused the wins.
• The end is the decision, in three forms.
• What to protect — where leadership must be defended and entrenched.
• What to build — which connector opens the market that is currently closed.
• What to drop — what is held at parity and confers nothing.
• Naming the wins is the step the tool cannot take for you. It belongs to whoever knows why the customer stayed.

What it provides

• An evidence trail — feedback in, effects read, and the resource, capability or competence each one implies.
• Six layers, one act — every layer is a named set of members from the layer below.
• The seven criteria at one layer only — the core competence, estimated in per cent and read by gates.
• The alignment — position is the lower of what the competence reaches and what the factor demands.
• A map of the whole ladder, drawn from the actual links.
• Things you can take away: the case as a file, a print view.

What it reflects

• What is available: people who know why customers chose them, and the events that prove it.
• What inhibits: competence, capability and resource used interchangeably; every strength called core; a business model too multifarious to hold in view.
• Each arrives as a vocabulary problem and is a causation problem underneath: nobody asked what produced the win.

Why it works

• A core competence is a networked portfolio of root-cause resources and capabilities, enabling activity systems, for enduring competitive advantage. Every word in that sentence is load-bearing.
• Root cause, not inventory — what a firm owns is not the question; what caused the choice is.
• Gates, not scores — four gates read the seven estimates one at a time: relevance under 34 % stops at deficient, any criterion at 0 % stops at threshold, scarcity under 67 % stops at key, and uniqueness without evidence stops at distinctive. Nothing is ever averaged.
• A capability is built by doing, along a learning curve, and it means being able to use a resource. Resources without a capability are worth little; capabilities without resources are toothless.

Two ways to use it

As a working tool, in the hands of a trained strategist — the senior strategist of the entity, say — who knows the method and drives it alone or with a small team.

Or, and this is where it is worth most, in a workshop moderated by such a specialist, or by us. Because the tool runs online, that workshop works over a collaboration platform (e.g. Teams®) as well as it does in a room.

The operating steps of each page stand on the page itself, under What this does and how to use it — what the page produces, in how many steps, and the rule that governs it. What follows here is what those pages cannot say for themselves.

Why implicit evidence outweighs explicit

• Repeat orders, a poached team, a copied feature, a lost bid with its reason — each of these cost the other side something, which is why they carry more than an opinion politely given.
• An effect nothing explains is marked unexplained, never invented. The unexplained list is the honest part of the case: it says where the competence has not been found yet.

Why the set is the identity, and the name only the label

• A competence is the set of constituents it is built from. One constituent may serve many competences; the same set may not exist twice under two names, and the tool says so when it does.
• This is what makes the claim traceable: rename it as you like, the structure underneath is what is argued about.

Why the seven criteria are gates, never a score

• Relevance under 34 % stops at deficient · any criterion at 0 % stops at threshold · scarcity under 67 % stops at key · uniqueness without evidence stops at distinctive.
• The percentages are never summed and never weighted. Seven judgements, read one at a time — a score would let a strength cover the very weakness that decides the case.

Why a connector never becomes a core competence

• A connector opens a market without winning it: access, a licence, a channel, a certification. However useful it is, it confers no advantage inside that market.
• An offering is core offerings carried to a market by connectors. Keeping the two apart is what stops a licence from being mistaken for a reason to be chosen.

Why not simply a list of strengths

• A strength list is written from inside and confirms what the firm already believes.
• This ladder starts outside — with an effect someone else observed — and works down to what caused it.
• What survives that descent is a competence; what survives the seven criteria is a core competence.

How the parts fit

• Constituents are resources and capabilities, and only the root-cause ones are worth carrying.
• A competence is a named set of constituents; a core competence is a named set of competences.
• Core offerings come from core competences; connectors come from constituents and competences; offerings come from core offerings and connectors.
• A member may serve several parents — that is leverage, and it is also the erosion path: one poached team can empty three competences at once.

Position, factor, competence

• Different positions demand different factors, and each factor demands a different extent of competence.
• Qualifying factors ask for threshold competence; critical success factors for key competence; key success factors for distinctive competence; strategic innovation factors for core competence.
• Position is the lower of the two — the competence you reach and the factor you address. A core competence aimed at a qualifying factor buys a follower's position.

Where this tool stops

• It does not value anything in money. That is the assessment instruments' work.
• It does not run the erosion analysis; that is a separate framework.
• It does not collect the feedback for you — it begins where someone can state an effect and its anchor.
• Known objection — "the percentages are guesses." They are judgements, and they are visible. The alternative is a strength list, which is also a judgement, with nothing shown.