Final answer:
Implementing a customer loyalty program from a successful makeup retailer into a new spray tanning salon business is an example of transferring competencies. This move is designed to replicate the success of the program in a new but related business venture, leveraging the retailer's established strengths and customer base while expanding operations.
Step-by-step explanation:
When a makeup retailer expresses interest in opening a spray tanning salon by implementing its successful customer loyalty program, this exemplifies transferring its competencies. The concept of transferring competencies involves taking a successful strategy or operation from one part of a business and applying it to another, with the anticipation that the success will replicate in the new setting. This is different from leveraging competencies, which would involve using existing skills to enhance performance in the original area, rather than transferring them to a new venture. Organizational design skills are more about the structuring and designing of business operations, and economies of scope refer to the cost advantages that a business obtains due to a broader scope of operations requiring a variety of products under a single entity.
It's important to note that focusing on core competencies can lead to greater success for businesses, as spreading efforts too thin across disparate product areas can dilute a company's brand and effectiveness. Hence, the retailer is smart to take a proven successful program from its core business and apply it within a related field like a tanning salon. Utilising this strategy is about recognizing the value of established strengths and applying them to expand the business while maintaining a connection to the original customer base and branding.