Resource Allocation Strategies for Maintaining Competitiveness and Achieving Innovation Success

  Resource Allocation Strategies for Maintaining Competitiveness and Achieving Innovation Success

Agnes B. Boadi-Sarpong, A. B., Prince A. Agyei, Emmanuel Mensah, Peter A. Boateng
Valley View University, School of Graduate Studies, P. O. Box AF595, Adenta, Accra Ghana
DOI: https://doi.org/10.51244/IJRSI.2023.10724
Received: 05 July 2023; Accepted: 18 July 2023; Published: 19 August 2023

Abstract: Resource allocation strategies are essential for maintaining competitiveness and achieving innovation success. They are interrelated, as maintaining competitiveness requires the ability to innovate, while innovation success is dependent on the availability of sufficient resources. This paper’s methodology consists of a library search and literature review on resource allocation strategies for maintaining competitiveness and achieving innovation success. The key search terms included resource allocation, innovation success, and competition. An in-depth analysis of literature related to study constructs was conducted using the systematic review procedure. Empirical and theoretical studies that applied resource allocation, innovation, and competitiveness were preferred. A random bibliographic scan was performed on all the research studies to find out relevant study material. The main objective is to assess the effectives of resource allocation in maintain organizational innovation and competitiveness. The resource base view theory was the underlying theory for the study. This study found that companies that allocate more resources towards research and development are more likely to launch new products and services, which can enhance their competitiveness in the market. Additionally, it has been found that resource allocation toward innovation can positively impact a company’s financial performance. Additionally, effective resource allocation strategies are key to maintaining competitiveness and achieving innovation success. By investing in R&D, talent acquisition and development, and strategic partnerships, organizations can gain a competitive advantage and deliver innovative solutions that meet the evolving needs of customers.

Keywords: Resource allocation strategies, Competitiveness and Innovation success

I. Introduction

The complexities of competition in today’s fast-paced market, as well as the need for continuous innovation, resource management, processes, and methods, have created a need for organizations to develop strategies for reaching out to customers in novel ways to gain a competitive advantage (Anning-Dorson, 2021). The concept of resources has been used in a variety of fields of human endeavor, including medicine, economics, ecology, management, computer science, and human resources. It’s also linked to concepts like sustainability, preservation, stewardship, and competition.

To achieve optimum productivity in economics and management in particular, factors of production require effective resource allocation through resource management or utilization (Davijani, Banihabib, Anvar, & Hashemi, 2016). Scarcity economic theory gave rise to resource management. Scarcity refers to the mismatch between finite scarce resources and the seemingly limitless client wants. People must make decisions about how to properly organize, manage, distribute, and regulate resources to meet basic needs and as many additional wants as possible in this situation. Scarcity necessitates regular economic decisions to plan, manage, and allocate available resources to meet human, organizational, and societal needs. Organizations are constantly besieged by the challenge of resource scarcity, which, when combined with the threat of rivalry and competition, means that decisions on resource planning, allocation, and control are beginning to determine market success and failure (Parniangtong, 2017). To meet the challenge of a world where resources are becoming increasingly scarce, businesses are becoming concerned with resource management, which includes efficient resource utilization, exploring alternatives to currently used resources (resource planning, allocation, scheduling, and control), supply security, and implementing new business models (enterprise modelling)(Bringezu, Potočnik, Schandl, Lu, Ramaswami, Swilling, & Suh, 2016).

The problem with competitive advantages is that they cannot be sustained indefinitely because rival firms tend to imitate the product or strategy. Even if attempts to simulate the product fails, changes in technology and technical know-how tend to shorten the lifespan of competitive advantages. As a result, to maintain a sustainable competitive advantage, organizations are turning inward to develop winning strategies that make creative use of their internal resources (Isaboke, 2018). The allocation of resources has a significant impact on an organization’s performance. Companies must have a clearly defined strategic plan and methods for implementing it to remain competitive (Park, 2022). Resource allocation is thought to influence how a firm invests and even takes advantage of emerging opportunities; thus, for increased performance, an organization must aim to effectively allocate its resources in a cost-efficient and differentiated manner from its competitors (Gitau, Abayo, & Kibuine, 2020).