The IUP Journal of Applied Economics
Optimal Resource Allocation for SQM: A Comparative Case Study in Pharmaceutical Industry

Article Details
Pub. Date : Jul, 2019
Product Name : The IUP Journal of Applied Economics
Product Type : Article
Product Code : IJAE31907
Author Name : Sanjay Kaushik and Harjit Kaur
Availability : YES
Subject/Domain : Economics
Download Format : PDF Format
No. of Pages : 21



The allocation of scarce resources forms the core of modern economies, but the focus of strategic management literature is more on a narrower challenge of appropriate allocation of resources for corporate strategy. The ‘soft’ element and ‘hard’ element of total quality management may be classified into three types of resources, namely, Human Resources (HR), Organizational Resources (OR), and Technological Resources (TR). The objective of the current paper is to optimally allocate the three resources for implementing the selected 10 quality strategies of Strategic Quality Management (SQM). A case study approach is used here based on the premise that resource allocation activity is unique to every organization. A combined Analytic Network Process (ANP)-Goal Programming (GP) operations research technique is used for optimal allocation of resources. Here, the gap between desired and actual resource allocation is assessed using ANP technique and GP is used for optimal allocation of resources. Both the techniques are operation research techniques and do not require a large sample size. The data is collected using Saaty’s (1999) 9-point paired comparison scale from respondents (three respondents per company) employed in two pharmaceutical companies. The results of ANP concluded that some of the quality strategies were over-resourced, while others were under-resourced in both the companies. The output of ANP was used as an input for GP and the results propose an optimal reallocation of three resources for the selected quality strategies of SQM.


The trade-offs and tension associated with the allocation of scarce resources form the core of modern economies. While the strategic management literature is more concerned about the narrower challenge of resource allocation for corporate strategy, the central issue facing corporate strategy is an appropriate allocation of financial as well as non-financial resources across multiple lines of activity at a given point in time and across time (Levinthal, 2017).

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