The scenario

ABC is a small firm operating in the retail sector. The firm has shown phenomenal growth in the recent past due to economic stability, less competition and increasing buying power of customers. The current growth of the firm has led to a struggle between different departments for grabbing maximum resources to ensure continuous growth of their respective departments. The departmental heads are claiming that departmental objectives are more important and resources should be allocated according to departmental objectives rather firm objectives. This viewpoint conflicts with the management believe that “resource allocation should be based on overall objectives of the firm”. The inter-departmental conflict starts shadowing the growth prospects of the organization and requires immediate action.

Discussion

Being a student of strategic management, you are required to support one of the above-discussed positions (firm based allocation VS department based allocation). Support your answer with solid arguments.