Financial Considerations

Lucreshia Jackson

American Sentinel College of Nursing & Health Sciences

SIM432PE

22nd September 2022

Financial Considerations

Finance is a crucial part of project management since every project needs to be planned in accordance to a budget. The aims and the project goals are met while the project sticks to its budget (Catalano, 2020). Therefore every project leader should have the budgeting skills allowing them to effectively allocate, assign, and forecast the costs in the different areas of a project, optimizing the spending (Marquis $ Huston, 2021). The managers in a project also ought to have the skills in managing profit and loss, cash flows, and balance sheet account for them to closely control and monitor the costs in the course of the project. Overspending on a budget is very easy therefore destroying the schedule of the project if the project runs out of money. Therefore, spending should be monitored for a project to finish (Catalano, 2020).

Our clinic project of introducing telemedicine as the new method of monitoring and providing healthcare to our Type 2 diabetic patients has not been left behind as it also focuses on the financial considerations of the project. In the financial analysis of this project, we have estimated that all the activities required to complete our project are $400,000. The estimated activities and their costs are;

The purchase of the telemedicine software would cost at most $300,000

The implementation will cost $30,000

The hiring of software architecture would cost around $10,000

The hiring of experts in this field to educate our medical personnel and patients on this new method would cost $30,000

Hiring a new CFO to oversee our financial; statements during the project would cost $20,000

However, this budget cost estimate is huge for our clinic, and therefore it is our duty to ensure that we are involved in activities that would reduce this budget cost. This will include reducing the budget duration from 3 months to 2 months. The budget will be managed correctly by our new CFO. Our clinic also aims to use agile management techniques during the project. We will also try and look for cheaper resources for our project. Some of our activities, such as our shareholders taking pay cuts and our outpatient activities by a margin, will reduce our expenses. The money from these activities will be used to finance our project.

However, we face some limitations in our financial activities. Our clinic cannot meet the estimated budget and can only fund up to $300,000; therefore, a deficit of 100,000 remains. Therefore, we require additional funds from loans that currently are at higher repayment interests. Also, some of our staff and stakeholders are to get pay cuts, which is a limitation since it would affect their morale during the implementation of this project. We also face higher taxes from the government, which will also affect our project budget as the amount taxable may become even more than estimated, interfering with our budget. We recently lost our finance manager, who had to quit due to medical reasons, and therefore we face a limitation of hiring a new CFO which would also cost our clinic a total of $20,000.

However, all these activities will be of benefit to our clinic. First, budgeting costs will help the project have a proper plan, preventing the clinic from running out of money as the project continues. The budget will also attract our investors, who will feel confidentiality in how we run the project. They can also raise the funding for this project, and the extra funds can be used to finance other activities that may occur during the project. With all these financial considerations, I believe that our project will be a success.

References

Catalano, T. (2020). Financial Project Plan. In Application of Project Management Principles to the Management of Pharmaceutical R&D Projects (pp. 53–54). Springer, Cham.

Read Chapter 10 in Marquis, B.L. & Huston, C.J. (2021). Leadership roles and management functions in nursing: Theory and application (10th ed.). Philadelphia, PA: Lippincott, Williams & Wilkins.