Resource allocation decisions

Scarcity means that resource allocation decisions cannot be avoided. If this is accepted, then it is clear that the basis on which these decisions are made should be explicit. Although economists do not claim to have the only - or even necessarily the best - answer for all choices that need to be made, at least economic criteria are explicit and hence open for criticism and debate. 

Pisano [3] discusses the management of process development projects in the pharmaceutical industry. Case studies are used to illustrate the effect of resource allocation decisions at different stages of a project. While there has been a focus on product development in the pharmaceutical industry, clearly process development plays an important role in getting a product to market and lowering the long-term product manufacturing costs. 

Project planning Project scheduling Team management Resource allocation Decision-making... 

The approach to measure quality of life has been developed by questionnaire to measure what the subject perceives as personal health. The assessments are being refined to provide improved assessment of the benefits and risks of medicines to the individual and to society. The challenge is to ensure that these are sufficiently robust to make resource allocation decisions between, for example the rich and the poor, the educated and the uneducated, the old and the young, as well as between groups of patients having very different diseases. Plainly, quality of life is a major aspect of what is called outcomes research. 

If RACs are, in fact, going to serve as the drivers in the system and the basis for risk acceptance and resource allocation decisions, the numbers generated must have a positive correlation to the risk involved and to the resources required to control the hazard. A universal RAC matrix would provide a means of comparing relative risks associated with multiple projects, evaluating the allocation of funds, and determining the cost-effectiveness of various controls. Ideally, this universal risk assessment code matrix could provide an evaluation of risks in absolute as well as relative terms. Chapter 12 contains a proposed universal RAC matrix (Total Risk Exposure Codes). The use of a meaningful, quantified, expanded universal RAC matrix may represent a practical approach to probabilistic risk assessment. 

Conlon, D.E., and Garland, H. 1993. The role of project completion information in resource allocation decisions. Academy of Management Journal 36, 402-13. 

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