Resource Allocation within an R&D Environment - The Agency Theory Conundrum

Sammanfattning: Abstract Title Resource Allocation within an R&D Environment – The Agency Theory Conundrum Seminar date 2011-06-03 Course BUSM65, second-year master thesis for Master in Finance, at the Department of Business Administration Authors Ívar Grétarsson, Kristoffer Johansson Advisor Dr. Niclas Andrén Keywords Agency Theory, R&D, Resource Allocation, QlikView Purpose Investigating and minimizing the effects of agency problems in the R&D resource allocation within Arandee as well as evaluate and improve the analysis of the resource and planning process. Theoretical perspectives Agency theory within internal capital markets. Methodology Case study and action research, data collection through observations and interviews. Empirical Foundation The employees at the Business Control department and selected program and line managers within division 1 at Arandee as well as internal documentation. Conclusions Agency problems affect the resource planning and analysis, but not the allocation of resources to the R&D programs. The problems can be solved changing the data recorded and by introducing benchmarks, audits and changes to the compensation scheme. The analysis of the resource allocation, performed by the Business Control department in Excel, was inefficient. The introduction of the business intelligence software QlikView improved the analysis greatly.