Management Gurus:

Hamel and Prahalad

TU-91.110 Industrial Business Relations and
Networks
24.4.2003
Group 10 Kimmo Jaakkola and Jari Ruokolainen

C.K. Prahalad and G. Hamel in

a Nutshell
Coimbatore Krishnarao
Prahalad

(Usually just C.K. Prahalad)

Short personal history:

Doctorate from Harvard
Business School
Professorships in
University of Michigan,
INSEAD, and IIM
Co-founder of Praja Inc.,
where he tried his wings
as an entrepreneur

Gary Hamel
Short personal
history:

Doctorate from the

University of Michigan
Professorship in London
School of Economics
Founder and president of
Strategos, an
international
management
consultancy

C.K. Prahalad and G. Hamel

Working Together
The two met in 1977 in Michigan
Hamel as a student, C.K. as an associate professor

In mid 1980s started to publish together.

Their main works (in Harvard Business Review,
which has been their forum of preference):

Strategic Intent (1989)

Collaborate with your Competetitors and Win (1989)
(authoring also Y.L. Doz)

The Core Competence of the Corporation (1990)

Competing for the Future (1994)

Also published as a book by Harvard Business School Press

in 1994

Central Questions & Ideas

Evolving in Their Work (1/2)
Strategic fit versus Leveraging Resources

the two main strategy schools according to C.K.P & G.H

Maintaining strategic the fit approach:

Trimming ambitions to match resources, search of sustainable

advantages, financial goals

Levaraging resources approach:

develop resources towards ambitions, emphasis on learning,

developing core competencies the approach preferred by the

authors

Incrementalisms versus Revolution

C.K.P&G.H argue that playing the same game better is no way

to success. Innovation and building on core competencies is
the key!

Centralization versus Decentralization

The authors claim that SBU thinking (decentralization) is

fundamentally against developing core competencies
effectively

Central Questions & Ideas

Evolving in Their Work (2/2)
The importance of strategic architecture
top-level strategy for developing new core
competencies, new functions, or evolving the existing
competencies
Heavy future-orientation, though actions need to
start now!

Core Competencies are the key to everything

Clarifying the core competencies, building on them,
and cultivating a culture of core competencies

Critique towards C.K. Prahalad

and G. Hamel
Empirical evidence shows that leading the

revolution, or developing the core

competencies first, does not necessarily lead
to success
Competition can build competencies later and via
incremental innovation win the game

Hamel&Prahalad are not clear, or even present

contrading views, about the role of top
management

Occasional emphasis on bottom-up, emergent

views, even work place democracy, but at the same
time heavy reliance on top management vision

Is strategic architecture just a new name for

strategic plan?

C.K.Prahalad and G.Hamel and

Industrial Business Networks
Competencies reach over company bounders
Collaboration in interaction among the
companies is emphasized

especially from the learning perspective, on building

core competencies
emphasis on learning on lower level of interaction
(individual approch), not top-management

Network approach, both internally and between

companies

..excellence is a complex web of ... integration with

suppliers, value engineering ... It is difficult to exctract
such a subtle competence ... but in a piecemeal fashion

Concluding & Summarizing the

Presentation
C.K. Prahalad and G. Hamel, influential

thinkers in the field of strategy in 1990s

Main contributions to the discipline:
The development of the concept of core
competency
Both within the corporation and in a network of firms
The emphasis on long-term strategic architecture
Opposition to short term cost-cutting and
incremental business development