1 paragraph please build on student response. Please include reference.
Student #1
Setting budgets is not a straightforward process. There are so many factors involved including inflation, liquid and non liquid assets, short and long term liabilities, expenses, and expansion. These are just some of the factors to consider. One of the biggest expenses of most companies are the employees. In order to retain good employees, companies need to budget in raises, hiring bonuses, and retention bonuses. Training new employees is much more challenging than retaining experienced employees. Plus with inflation, costs of supplies and vendors are increasing. Are the prices for goods that the company provides rising at the same rate?
With declining budgets, managers have to make difficult decisions on what to cut from the budget. This can and will impact how effective care is provided to patients, and how duties are completed. With expanding budgets, managers need to be careful of what they choose to give a greater budget. The same budget might not be available next year, and it’s much harder to reduce a budget after an increase. Also the increased budgets should be prioritized for ventures that can become profitable. For instance, buying a new machine that increases output and thus increases profits is a good use of the increased budget.
Budget managers set limits of how much can be expensed for different needs. They set limits that other departments need to stay within. While there can be some maneuvering within the department of the budget allocation, the budget manager ensures that the main budget is adhered to.
Student #2
Budgeting provides resources public healthcare organizations need to structure plans. Budgets are generally developed through a program, department, or organizational level based on strategic planning and goal setting. Therefore, working to ensure quality by designing or redesigning systems. Cost controls and resource management should always consider budget/resource management so that the quality of health services is not affected by actions. Efforts to improve controlling budget practices have suffered because of increased costs and inefficient resource utilization. Budgets provide strong financial incentives for cost control if structured correctly and guarantee a degree of stability for public healthcare. Budget Challenges faced by public healthcare leaders in a time of either declining or expanding budgets: higher levels of borrowing, higher interest rates, and low reinvestment which will lead to lower revenue. Roles budget managers play in controlling costs : financial decisions, budget managers are the organization’s experts, advocates for cost-saving process changes, and where to allocate, deploy, and invest in financial resources.
