Resource Allocation Final

8/6/2019 Resource Allocation Final

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Presented by: Abhi Jain

10316603909



` Management is responsible for allocating resources in

order to achieve an organization¶s purpose.

` Resources are acquired, allocated, motivated and

manipulated under the manager¶s control. They include people, materials, plant and equipment, money, and

information.



` In organizations, the decision-making function is the

responsibility of management. In order to execute its

responsibility, an organization¶s management requires

information about the resources available to it and their relative effectiveness for achieving the organization¶s

purpose.



` Identify/design alternatives

` Identify and structure the organization¶s goals and

objectives

` Prioritize the objectives and sub-objectives` Measure each alternative¶s contribution to each of the

lowest level sub-objectives

` Find the best combination of alternatives, subject to

environmental and organizational constraints



` Expertise in the art and science of identifying and/or

designing alternatives lies in the domain of the decision

makers, who have many years of study and experience

to bear on this task.



` Most organizations already have a statement of goals

and objectives which will serve as the driving force

behind the allocation of resources.

` The hierarchy of objectives, sub-objectives, sub-sub-objectives, and so on, must be broad enough to

encompass every existing or desired activity that is part

of the resource allocation process.



` Top level executives understand and can best make

judgments about the relative importance of the main

organizational objectives, and possibly the sub-

objectives.` Lower level management and operational personnel can

best make judgments about the relative importance of

the lowest level sub-objectives and about how much

contribution each alternative contributes to the lowestlevel sub-objectives.



` The relative importance of the objectives and sub-

objectives must be established in order to make a

rational allocation of resources.

` Assuming that all the main objectives are equallyimportant is a mistake.

` After establishing priorities for the organization¶s

objectives, and subsequently deriving a µpreliminary¶

allocation based on these priorities, the priorities and judgments that served to derive the priorities should be

reexamined and revised as necessary.



` Having prioritized the organization¶s objectivesand sub-objectives, the next step is to evaluatehow much each proposed activity would

contribute to each of the lowest level sub-objectives.

` Ratings approach is generally followed for this.



` After prioritizing the organization¶s objectivesand sub-objectives, and rating the contribution of the competing activities to the lowest level

objectives, we do a ratio scale measure of therelative contribution of each alternative to theoverall objectives of the organization



` A mission is a clear, concise and enduring

statement of the reasons for an organization¶s

existence today.

` A vision represents future purpose, providing amental picture of the aspirational existence that

an organization is working toward.

`

Values are the ideals and principles which guidethe thoughts and actions of an organization and

define its character.



` As strategy is concerned with the intelligentallocation of limited resources, we can see thatidentifying a current and future purpose is critical.

` From a strategic thinking perspective, establishing

a clear and compelling purpose provides thegeneral basis or criteria on which resourceallocation decisions should be made and measuredagainst.

` Without purpose, the rationale for decision making becomes subjective and disconnected from thegoals and objectives trying to be achieved.



` The mission statement, or current purpose, is first andforemost one of the five key elements of strategicthinking. Without a current purpose, the crucialfunction of decision making has no objective basis.

The mission statement gives everyone a baseline thatguides and unifies decision making.

` The mission statement ensures that different functionalgroups within the organization or individuals within a

department have the same underlying rationale for actions. In this sense, the purpose unifies efforts andmaximizes the utilization of available resources toreach goals and objectives.



` The vision statement creates a mental picture of what the purpose of the organization will look like in the future.

` The vision statement provides two things: strategicguidance and motivational focus. As the vision statementrepresents the future purpose, the strategic thinking thatgoes into creating it ensures that it represents the best use of the organization¶s resources in reaching its objectives.

` It serves to align individuals from different functional areasand geographic locations to move toward the same future

purpose, allowing them to use their creativity and talents toget from ³here to there.´ Thus it guides actions that are notnecessarily geared toward the short-term by showing thedesired longer-term future and the benefits of realizing thatfuture.



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Resource Allocation Final