This paper examines the relationship between information systems capabilities and firm performance using resource-based theory as the theoretical lens. We identify and define three key constructs: IS resources, IS capabilities and IS competencies. We develop a research model that relates these constructs and firm performance. The basic premise of our model is that IS competencies have a direct impact on firm performance where as IS resources and capabilities are antecedents to IS competencies. Implications of this study for future research and practice are discussed.