Final answer:
It is true that companies without core competencies can implement either cost leadership or differentiation strategies. However, lacking core competencies can make it difficult to execute a combined approach, as they might not be able to balance low costs with unique offerings effectively.
Step-by-step explanation:
The statement that companies without core competencies in their value-chain activities and support functions are still able to successfully implement either a cost leadership or a differentiation strategy is true. However, these companies may find it challenging to implement an integrated cost leadership/differentiation strategy due to the intricate balance required between maintaining low costs and offering unique value that differentiates them from competitors. A core competency is an area that a company can perform better than its competitors and may include a robust value chain, special skills, or resources that enable it to produce goods or services more efficiently or distinctively.
Having a core competency tends to make companies more successful because it allows them to focus on areas where they have an advantage. This focus can derive from a high degree of specialization, economies of scale, or the ability to carve out a unique market position. Companies without such strengths may still compete on price or differentiation, but their lack of core competencies may limit their ability to stand out in both areas simultaneously.