MANAGEMENT OF FINANCIAL RESOURCES

Financial resources are those things a company needs to acquire to acquire other resources, which the company used to further produce her output for the final consumer. Financial resources could be seen as the “Mother” of all other resources in an organisation; be it physical, human, and information resources. Financial resources seem to be the basis of their acquisition in any business settings. This unit throws light on the meaning, needs, and ways of managing resources and the need to work in coordination with the subordinates for a better result in business.

OBJECTIVES

At the end of this unit, you should be able to:

• explain budgeting as a form of managing of resources 
• discuss consultation with subordinates and/or delegation. 

Budgeting as a Form of Managing of Resources

The acquisition of resources is one of the most important aspects of a company or business activities. This is because of the trade-offs between types of resources and their resultant effect on one another. This also holds for the management of the resources. The best way to manage resources is to have budget for each of the units or departments in an organisation to avoid wastage. A budget is that plan or outline of control, which a unit puts in place to have a judicious use of the resources allocated to it. In an organisation or business, there are mainly four or five types of budgeting depending on the target of the business.

These are manufacturing budgets, research and development budgets, advertising budgets, capital equipment budgets, sales budgets etc.

Business managers or owners of businesses work within the confines of their budgets such that there will be no wastage or shortage. A well-managed budget provides good result for any business venture in term of profit and sustainability of the business. According to Barrow et al (2002), the task of the manager is to allocate and use all the resources under his or her control to meet the purposes of the organisation. The successful management of all resources depends on effective planning, the strategy and the action plans.

It is not the robustness of budget but the ability of a manager to make use of the limited resources at his disposal to achieve the target of the business effectively.

 Consultation with Subordinates and/or Delegation

As a manager of resources, whether physical, financial, and information, there is the need for you to consult with those who work with you to carefully analyse the needs in each area. It is not uncommon for managers of resources to fail because of their refusal to consult with their subordinates. While there is no foolish or underdog idea; a careful analysis of all ideas could safes and bring about progress in a business. Therefore, there is need for consultation and exchange of ideas with subordinates, who knows, the least staff of the organisation might safe a collapsing situation of a business with his/her idea. Business managers should not under rate the support ideas of their subordinates in managing the resources of their business. 

SELF-ASSESSMENT EXERCISE 1

• Identify the need for budgeting in business outfit. 

CONCLUSION

This unit explained the importance of efficient and effective management of resource to any business. Budgeting and delegation of authority are means to getting the most effective management of resources in an organisation where the various units of the business proved and work toward its success.

SUMMARY

Resource acquisition demands that managers work along with many people throughout the business to acquire and use resources in the most effective and least expensive way. This is very vital because a change in one resource can affect the use of others. This is as a result of trade-offs concepts, which means using funds for one thing precludes them for others. The movement of resources involves the movement of goods, equipment people, inventory, and information from outside the business through, and back.

TUTOR-MARKED ASSIGNMENT

• Discuss the importance of budget to a business outfit. 
• Identify the needs for delegation/consultation in running businesses