Chapter-3 Resource Mobilization

 

 

Resources

In business, resources refer to all the inputs, tools, and elements that are required to operate, manage, and grow an organization. They are the foundation of every business activity and help in the production of goods, delivery of services, and achievement of business goals.

A business cannot run without resources. They are used to:

• Start the business
• Hire people
• Produce or deliver goods/services
• Manage customers
• Make decisions
• Compete in the market

Resources are limited, so businesses must use them efficiently to avoid waste and improve performance.

 

🔷 Major Resources

Every business, whether small or large, relies on certain core resources to function and grow. These are the essential building blocks that allow a company to produce goods, deliver services, and meet its goals. The four primary types of business resources are:

a. Financial Resources

These are funds required for starting, operating, and expanding a business. No business can survive without money. Financial resources help in acquiring physical resources, paying employees, purchasing raw materials, marketing, and meeting day-to-day expenses.

b. Physical Resources

These are tangible assets used in business operations. They include land, buildings, machinery, vehicles, tools, and equipment. A factory, for example, needs land to build on, machines to produce goods, and warehouses to store them.

c. Human Resources

Human resources refer to the people who work in the organization. This includes all employees — from top management to operational staff. Their skills, creativity, knowledge, and labor are what keep the business running.

d. Informational Resources

In today’s digital age, information is power. Businesses must gather, store, and analyze data related to markets, customers, competitors, and internal performance. Informational resources include systems like MIS (Management Information Systems), reports, analytics tools, and databases.

All four resources are interdependent — financial resources help acquire physical resources, human resources manage and operate them, and informational resources ensure efficient decisions.

Local Example:

A school in Simara needs:

• Money to build classrooms (financial),
• Land and furniture (physical),
• Teachers and staff (human),
• Attendance software (informational).

 

 

🔷  Financial Resources

Financial resources are the monetary backbone of any enterprise. Proper funding allows a business to begin its operations, sustain itself, grow, and stay competitive.

a. Equity Capital

Equity capital is the money invested by the owners or shareholders. In return, they gain ownership rights and share in the profits. It is not repayable like a loan but comes with a risk, as investors only earn if the company profits.

b. Debt Capital

Debt capital is borrowed money that must be repaid over time with interest. It includes bank loans, bonds, or credit from suppliers. Though it increases financial liability, it doesn’t dilute ownership like equity.

c. Fixed Capital

This refers to long-term investments in fixed assets such as land, building, equipment, or vehicles. These assets are not easily converted to cash but are necessary for long-term operations.

d. Working Capital

Working capital is the money used for day-to-day operations. It covers short-term needs like buying raw materials, paying wages, electricity bills, etc. Efficient working capital management ensures smooth operations.

e. Venture Capital

Venture capital is money provided by investors to start-ups or growing businesses with high-risk but high-potential returns. In return, venture capitalists often take a stake in the business and may influence decisions.

f. Mutual Funds

Mutual funds pool money from many investors to invest in stocks, bonds, and other securities. Businesses may invest in mutual funds for additional income or use them as a source of finance for larger corporate needs.

In summary, financial resources must be planned, acquired, and managed wisely to support business strategy and survival.

Local Example:

A clothing shop in Jeetpur:

• Uses Rs. 5 lakhs of owner’s money (equity),
• Takes Rs. 3 lakhs loan from NIC Asia Bank (debt),
• Buys furniture and AC (fixed capital),
• Buys new stock for Dashain (working capital).

 

 

🔷  Physical Resources

Physical resources refer to all material assets owned and used by a business in its operations.

a. Land and Building

Land is needed for offices, factories, and warehouses. Buildings include offices, production units, and storage areas. The location and quality of land/building impact costs, access to market, and employee convenience.

b. Machinery and Parts

Machinery is essential for manufacturing or providing services. It increases productivity and reduces labor dependency. Parts and equipment must be maintained regularly for smooth operations.

c. Furniture and Fixtures

These are necessary for supporting office work. They include desks, chairs, shelves, lighting, AC, etc. Though they don't produce goods, they create a comfortable and functional work environment.

Proper management of physical resources ensures:

• Higher productivity
• Better employee morale
• Lower maintenance cost
• Efficient space utilization

Local Example:

Baba Biscuit Factory in Simara uses:

• Land and building for factory,
• Biscuit-making machines,
• Office tables and fans for staff.

 

🔷  Human Resources

Human resources are considered the most dynamic and valuable asset of any business. While machines can be bought, and money can be raised, skilled people drive innovation, strategy, and service quality.

a. Recruitment

Recruitment is the process of attracting qualified candidates to fill vacancies. It involves job advertisements, campus hiring, referrals, and online platforms. A well-planned recruitment strategy ensures the right people apply.

b. Selection

Selection involves choosing the best candidates from the applicants. It includes written tests, interviews, skill tests, and background verification. The goal is to hire people who are a good fit technically and culturally.

c. Retention

Once employees are hired, retaining them is crucial. High employee turnover is expensive. Retention strategies include offering competitive salaries, recognition, training opportunities, career growth, and a healthy work environment.

Benefits of effective HR management:

• Increases employee satisfaction and loyalty
• Boosts productivity
• Reduces hiring costs
• Enhances company reputation

Local Example:

A hotel in Birgunj:

• Puts a job post for waiters (recruitment),
• Takes interviews and hires 3 staff (selection),
• Gives salary, food, and holidays to keep them (retention).

 

🔷 Informational Resources

In today’s competitive world, information is a strategic asset. Businesses must collect, process, and share information accurately and efficiently to make timely and informed decisions.

a. Intranet

An intranet is a private network used within a company. It connects employees, departments, and management. It is used for sharing internal communications, company updates, policies, and training materials.

b. Extranet

An extranet allows selected external stakeholders — such as suppliers, distributors, and partners — to access parts of the business’s internal system. This helps in coordination, reducing delays, and enhancing supply chain efficiency.

c. Internet

The internet is a global system used for communication, marketing, e-commerce, research, and more. It enables businesses to reach customers worldwide, advertise products, and receive feedback.

Use of informational resources leads to:

• Faster decision-making
• Better coordination
• Real-time communication
• Increased customer satisfaction
• Improved productivity

Local Example:

A mobile shop in Simara:

• Uses intranet to manage staff work.
• Shares stock data with Kathmandu supplier using extranet.
• Posts phones and offers on Facebook using internet.