Strategic budgeting and financial management in healthcare organizations

¶ … Budget Process: This has proved to be the main challenge of financial managers in health care. It is a complex process that requires a mix of activities including intensive discussions, political trade-offs, and negotiation. It also consumes a large chunk of the time for many organizations. It may last up to half the fiscal year. What are the effects? The financial management team is therefore unavailable to offer support to essential needs in the meantime. Furthermore, the budget is usually in disconsonance with the organizations' central strategic pursuits. These blunders must be discouraged in modern healthcare set ups. Decisions ought to incorporate all stakeholders including the main players in the financial teams and should involve a holistic analysis and a well thought out economic blueprint (Kaufman, 2006).

How strategic budgeting applies in healthcare organizations

The approach in the research of the thesis

Both primary and secondary methodology will be used in the conduct of the research. Primary research refers to that process in which the researchers collect information by themselves. Examples of such research includes observations, surveys, and even ethnographic research strategies. Good research entails learning how to incorporate both primary and secondary strategies cohesively (Driscoll & Brizee, 2016).

Primary data will be collected by use of surveys and interviews. Interviews involve question and answer sessions in small groups or with individuals. Interviews are efficient especially when you wish to collect a lot of information in a short period of time. They are also effective when collecting expert information from knowledgeable people. Surveys tend to be more rigid compared to interviews. In contrast with interviews, they provide a smaller amount of information from a large number of people. They are helpful when the researcher's intention is to get the general opinion of large groups (Driscoll & Brizee, 2016).

Secondary research, also known as secondary data collection, is the most widely used method of collecting data. It entails getting the data from some other original source or the distributor of the primary research. It commonly involves accessing data from third party sources such as websites, magazines and market research reports. Generally, all information that has been gathered previously is secondary research (KnowThis.com, 2016). Such information may be from sales reports, accounting records, or even marketing organizations' reports.

The key methodologies for the application of financial management in healthcare organizations

I. Capital cycle management: There are three key components for healthcare organizations

a. Progressive and integrated financial planning procedure that takes into account the strategies of an organization and its financial muscle;

b. A capital structure that is in line with the existing financial and capital status of an organization;

c. An allocation plan that provides room for prioritizing spending options so as to enhance service delivery even as it protects the long-term financial capacity.

II. Analysis and boosting the credit worthiness of an organization. The ability of an organization to raise capital from the debt market is an indicator of its competitive status. There should be a set minimum credit rating for any organization in order to maintain its competitive edge on the market.

III. There should be an integrated financial planning hand-in-hand with strategic budgeting techniques. It is essential to identify and select the strategies to help an organization realize its goals. The viability of such strategies requires sober and solid financial planning and an active support for the selected strategies with the necessary capital resource.