Image modifications should be made prior to uploading any file to the CMS. See Image Sizes in the CMS for more information.
There are multiple ways to display images in the CMS (as a stand alone, inside articles, news, events and in people profiles). All of them involve the same process, which is to upload a "static" file (.jpg, .bmp, or .gif).
The following Knowledgebase documentation outlines how to add different kinds of images to the CMS: