In the mid-1950s, there was a hamburger restaurant in San Bernardino, California, which was owned by Richard and Maurice McDonald. The potential of fast food as a lifestyle preference to meals became apparent to Ray Kroc, then a milkshake salesman. Kroc further developed the fast food concept, creating the legacy that is McDonald's today. His strength thus lay in his ability to capitalise on the changes in people's lifestyles.

During the early 1970s when computing and communications began to converge, NEC, wanting to take advantage of this trend, identified interrelated streams of technological and market evolution. The strategy entailed becoming competent in the semi-conductors business and building up the strengths in this line to cash in on segments: computing, communications and components. This resulted in a redefinition of its core competencies in order to maximize emerging opportunities.

Canon's core competencies lay in optics, imaging and micro processor controls. This gave it dominance in diverse businesses like cameras, copiers and laser printers.

The differing visions of their core competencies took Honda and Chrysler along different paths. Honda viewed its core competencies in engines and power trains - which gave it long-term business advantages in cars, motorcycles and enerators. Chrysler, on the other hand, perceived engines and power trains as just components and chose to outsource these from Hyundai and Mitsubishi. Failure to develop these strengths has negatively affected Chrysler's product leadership position.

Despite its competency in research and development and its success in X-ray scanners, EMI failed to gain dominance in the medical electronics industry. EMI's weakness was its failure to develop capabilities in manufacturing high volumes at low cost to establish sound service and distribution networks within the USA.

McDonald's and Coca-Cola are often perceived as symbols of homogenisation of tastes and markets, and therefore cultures. But what is important is what they mean to people in each culture. Eating at McDonald's is a show of status in Moscow, but in New York it's "a fast meal for a fast buck".

America's Weaver Popcorn was reputed for providing quality products for 59 years. Yet their first sales to Japan were ejected when the Japanese quality inspection found some impurities in the popcorn. Weaver did not give up. They installed sophisticated optical inspection equipment that cost over half a million dollars and went on to gain 60% of the Japanese popcorn market.

Compfrio, a well-established Spanish company in the business of processed meat manufacturing and a market leader in its own country, is capitalising on its competitive advantage.

The Spanish consumer of a few decades ago is similar to the consumer in the developing countries of today. Thus Compfrio products are ideal for emerging markets in countries such as Russia, Mexico and the Philippines. The product's shelf life is long enough to survive slow, long distribution lines. What is seen as "overprocessed" in Western Europe, is ideal for the developing world where refrigeration is not always guaranteed.

Faced with the onslaught of Xerox, who came with a huge direct-sales force and a financially engineered sales plan, Canon managed to convert these threats into opportunities by:

• Distributing its copiers through office- product dealers
• Choosing to sell outright rather than lease as Xerox did, thereby freeing it from huge lease servicing costs
• Building reliability and serviceability into its product, and thus doing away with the need to create a national service network
• Delegating the service responsibility to its dealers.

In the wake of quartz watches, the Swiss watch industry was faced with a declining market. The launch of the "Swatch" heralded a new market that looked at a watch not just to tell time, but as a fashion accessory too.

When the Ford Motor Company of Australia took stock of its business after the 1986 setback in its profits, one significant threat to improved operations that loomed large was the level of disrupted industrial relations at its suppliers. Having changed to a JIT inventory system meant Ford was increasingly vulnerable to any disruption to its supply of components.

Xerox's decision to rent or lease its copters to customers, as opposed to an outright sale, provided them with financial advantages. This posed a significant threat to Canon's markets. In order to deter the entry of Xerox into the personal copier market, Canon needed to improve its price-performance. Rather than reduce the price of its existing models, Canon challenged its engineers to reinvent the copier and set a target price of $1,000 for a home copier. The result: the complex image transfer mechanism was substituted with a disposable cartridge.