Final answer:
Firm resources should be valuable, rare, inimitable, non-substitutable, and produced with the capability to generate other goods and services. These resources are most effective in a stable and market-oriented economic climate, contributing to a sustained competitive advantage.
Step-by-step explanation:
In order to contribute to sustained competitive advantage, firm resources should be valuable, rare, inimitable, and non-substitutable. Resources and capabilities that satisfy these criteria can enable a firm to create and execute strategies that improve efficiency and effectiveness. To ensure their contribution to competitive advantage, resources should align with the following characteristics:
- The resource must be produced; it should be through an intentional creation process that adds value. This includes investments in human capital, technology, and physical plant and equipment.
- The resource should be capable of producing other goods and services, thereby enabling the firm to respond to market demands and changes efficiently.
- Additionally, the firm should operate in a stable and market-oriented economic climate to maximize the potential of its resources.
By focusing on these key aspects, companies can better leverage their resources for long-term strategic success and maintain their market position.