Resources are a firm's productive assets; capabilities are what a firm can do.

Question

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Resources refer to the assets or inputs that a firm uses in its production processes, including tangible assets (e.g. machinery, buildings) and intangible assets (e.g. knowledge, patents). Capabilities, on the other hand, refer to a firm's ability to effectively utilize these resources through skills, knowledge, and processes. In other words, resources are passive inputs while capabilities are the active ways that a firm creates value.

Resources Are a Firm's Productive Assets; Capabilities Are What a Firm