Improve Resource Allocation

5 tips to improve resource allocation

Resource allocation is the process of designating and managing resources to achieve an organization’s strategic planning objectives. It involves managing hard assets like your equipment and building to maximize the use of soft assets like employee skills. Resource allocation is conducted through critical decision-making.

Decision-making skills are the cornerstone of management in any business, company, or organization. Decision-making is especially important when it comes to resource allocation. Each project, department, and task constantly competes for priority consideration on a day-to-day basis. Furthermore, each activity is time sensitive; rescheduling it may be detrimental to progress.

The competing resource needs of a company present the challenge of determining the best criteria for allocation, who will oversee allocations, which activities require urgent allocation, and how many resources will be needed.

Traditional resource allocation methods have had to evolve in recent years due to the COVID-19 pandemic. Many companies opted for remote working solutions after the first lockdown in March 2020. The health industry had to devise a new way of calculating resource utilization to allocate medical supplies to the most affected areas.

The pandemic presented a series of obstacles and opportunities when allocating resources in office-based organizations. This article will provide five tips that will assist your business in adequately allotting resources in the wake of the changing working situation.

Set Achievable Goals

The first step of allocating resources lies in understanding the short and long-term goals of the organization, business, or company. Your company might have experienced a decline in profits during the pandemic, and now you wish to grow. You will require a strategic plan for recovering in the short term as you anticipate growth in the long term.

Short-term goals, ideally, will involve allocating resources to critical company operations in need of resources such as capital and human resource. Furthermore, adding more resources to profitable operations will help boost income. Long-term goals will primarily be centered around the company’s survivability by setting up emergency resources.

Set Up Communication Channels

Effective and timely communication is imperative when executing an organization’s strategy. Conflicts are likely to arise when resource allocation changes occur without the consult of departments. Furthermore, work morale will be affected when employees are not involved in making office decisions. Hence, it is crucial to set up clear communication channels to spread critical info efficiently and avoid issues in the organization.

Reprioritize Operations

The achievable goals will reveal the nature of operations in your organization. Traditionally, the prioritization method of allocating resources to lacking operations would be an excellent place to start. However, a strategic approach to the process will be better when looking at the bigger picture.

As a result, you will need to identify all business operations, calculate the resources they are currently using, and run them through a prioritization matrix. The matrix will reveal the nature of tasks from different dimensions instead of the time and resources required.

Manage Finite Resources 

Once you have identified the operations requiring more attention, you can calculate the required resources per task. As mentioned in the article, this aspect needs a projection of the company’s economic growth in the short and long term. You might require building an investment plan for each business operation to generate the projected outcome.

You will then analyze potentially profitable activities versus those that might be causing the company losses. Overlaying the performance trend of each operation before, during, and after the pandemic with the company’s growth trajectory can give you a clearer insight into where to allocate resources.

Team Designation

The designation of a team to oversee the resource allocation process will either make or break the company. Large corporations have multiple departments. Ideally, you can use resource management software to identify suitable candidates and have a face-to-face interview to understand your potential team better.

The team designation will require a managerial approach. You will need to delegate the task to ensure a fruitful process. The team composition usually includes employees from all departments and company stakeholders. The two groups of people will provide an internal and external viewpoint of the dynamic of each department.

Use Allocation Methods

Resource allocation in any organization or company is always met with pushback from department heads or employees. Each department member is attached to their cell and might reject the allocation procedure. Furthermore, allocating human resources might destabilize a department because of disrupted workflow. The following steps will help curb possible resistance:

  • Management incentives and the integration of dynamic resource allocation into the planning process will aid integrated allocations. Making it necessary and advantageous for management to continually look for methods to utilize resources for the broader good of the firm rather than their fiefdoms is what you aim to achieve.
  • Decide who is responsible for what at the corporate center and business unit levels, what gets tracked and reported, and what the escalation procedure will be.
  • Review the underlying assumptions frequently to ensure they remain valid for newly requested investments and previously allocated resources that have not yet been used. Is it necessary to revise the assumptions if managers object to resource allocation decisions?
  • Consider organizational changes to improve resource flexibility, like adopting modern technologies and training employees.

Different allocation methods will help cater to the resource needs of each department, operation, and project. The varying methods should maintain the workflow in the company or organization.

Conclusion 

Resource allocation is an ideal way to utilize finite company resources. As a management tool, it is perfect for helping any organization stay afloat in a crisis. Furthermore, the organization will reach its peak potential when resources are optimally utilized. Follow each step and gradually watch your organization improve in productivity.

Kim Harrison

Kim J. Harrison has authored, edited, coordinated, produced and published the material in the articles and ebooks on this website. He brings his experience in professional communication and business management to provide helpful insights to readers around the world. As he has progressed through his wide-ranging career, his roles have included corporate affairs management; PR consulting; authoring many articles, books and ebooks; running a university PR course; and business management. Kim has received several international media relations awards and a website award. He has been quoted in The New York Times and various other news media, and has held elected positions with his State and National PR Institutes.

Content Authenticity Statement. AI is not knowingly used in the writing or editing of any content, including images, in these newsletters, articles or ebooks. If AI-produced content is contained in any published form in future, this will be reported to readers.

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