Impacts of organizational resources on agency performancex
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Resources are essential for successful organizational performance. However, scholars in public administration and public management have paid relatively little formal attention to the role and importance of resources because they have usually assumed that resources positively influence performance. Yet, in reality, we lack comprehensive empirical evidence about various resources’ different roles in and impacts on a public organization’s performance. To move the study of government performance in the public sector forward, this study attempts to apply the resource-based view (RBV) to understanding federal agencies’ performance. Through testing the RBV, this research project focuses on identifying which resources are actual valuable, scarce, and imperfectly imitable resources that have competitive advantage for better performance in federal agencies. To this end, this study uses the two-step approach. The first step is to identify resources with the potential for competitive advantage in federal agencies. Yet, these resources are still in the state of having the potential for competitive advantage. To confer actual competitive advantage, resources must contribute positively to organizational performance. Therefore, the second step is to investigate whether they have positive effects on agency performance. This study offers six types of organizational resources (i.e., administrative, human, financial, physical, political, and reputation resources), which are then broken down into specific variables. In order to identify which resources are actual valuable, scarce, and imperfectly imitable resources that have positive effects on agency performance, this research tests the relationships between various resources and agency performance (i.e., managerial effectiveness, program effectiveness, and financial performance) simultaneously. The analysis results revealed the following: Number of members in top leadership, professional employees, presidential attention, and agency’s reputation had positive and significant impacts on managerial effectiveness. Term length of members in top leadership, agency’s reputation, and general property, plant, and equipment had positive and significant relationships with program effectiveness. Number of members in top leadership, non-career SES, career SES, congressional attention, and agency’s reputation had positive and significant impacts on financial performance. These findings can provide useful information about how to strategically use and manage which resources for which performance goal.