Economies of scope in organizational capabilities can be exploited as effectively through contractual agreements with firms in anther industry as through diversifying into that industry.

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Economies of scope in organizational capabilities often involve leveraging shared resources, knowledge, and processes across different but related product lines or services within a single organization. While contractual agreements with firms in another industry can provide some benefits, they may not fully capture the efficiencies and synergies that come from diversifying into that industry and integrating operations internally. Diversification allows for more direct control and coordination across different activities, potentially leading to greater cost savings and innovation compared to what can be achieved through arm's-length contractual relationships.

Economies of Scope in Organizational Capabilities Can Be Exploited as Effectively