Organizational capability is defined as
“Know how to act, potentials of action which results from the combination and the coordination of resources, knowledge and competencies of organization through the value flow, to fulfill strategic objectives” .
- From the above definition, it’s clear that organizational capabilities establish the key abilities that a company must develop to gain a competitive advantage and to determine the status of its strengths and its weaknesses.
- These capabilities are used to assess the organization development levels along with the performance improvement in the activities of organization.
- Since, all organizational resources are involved in achieving corporate objectives. So, at a local level; organizational capability is the synergy of human, physical and structural resources of an entity around the defined strategic objectives and at upper level; It’s the co-operation of individuals sharing the same corporate practices.
In my next blog, I will write about the methods to assess organization capabilities. So, stay tuned!