In this lecture, we explore C. K. Prahalad and Gary Hamel’s influential concept of core competencies and their argument that firms succeed not by managing portfolios of products, but by cultivating the deep, collective capabilities that underpin innovation and growth. Using examples from Honda, Canon, Apple, and Google, we see how core competencies enable firms to enter new markets, create new products, and sustain advantage over time. The episode also considers the risks of neglecting or misidentifying competencies, the need for renewal in a fast-changing world, and the ethical implications of valuing people and knowledge as the foundations of strategy. Prahalad and Hamel remind us that while products come and go, competencies endure — and they are the true source of long-term competitive strength.