Question

What are strategic "resources '"and competencies "? How they differ from each other? How they are interrelated

Answer 1

Strategic resources are the assets that are available to an organisation. These assets might be exclusively available to an organisation at better prices due to various reasons such as location proximity, better relationship with supplier etc. and thus gives the organisation strategic advantages over the competitors.

Competencies are mostly the skills, characteristics and abilities of an organisation to compete with other organisations in the market. Different competencies of different divisions of a company when utilized together defines whether an organization will have competitive advantage in the market or not.

Resources can be both tangible resources like building, tool, raw material, finished goods, cash and intangible resources like softwares, reputation, good will, brand name. Competency in itself has no virtue. Competencies are defined by complex iteractions between individuals and departments.

While resources can be easily replicated by the competitors, it is often very difficult to replicate competencies of an organisation.

Resources and competencies individually are not of any use to an organisation. How efficiently the resources are brought into action and are utilized is defined by the competencies of the organisation. In other words, the act of deploying and utilizing resources efficiently and repeating the same act in a routine will be called a competency for an organisation.