Transform or resize without losing quality. Instead of resizing the instance (a copy) of the content that you inserted into your document, Photoshop remembers info about the original, resizes that, and then places that information back into your image (without altering the original file). It doesn't matter whether that original lives elsewhere on your hard drive or right there in your Photoshop document (on another layer, say). In the blink of an eye, Photoshop updates your document with the newly resized content without making it look blocky (so long as you don't exceed the file's original dimensions—unless it's a vector, of course). You can also use the full range of transform tools (The Transformers) on Smart Objects, too.