Budgets measure the performance of health care systems; they account for the generated income and related expenses. It is important to keep track of the financial data because it defines the type of services in the health department, the hours of operation, the labor structure, and cost in figures. A nurse leader should understand the financial targets and build structures that seek to achieve these objectives. Budgets are monitored monthly to provide an improvement plan for the organization. The processes involved in the provision of health care are scrutinized to ensure that the organization utilizes labor, technology materials, and the other facilities to the fullest to prevent wastage and improve quality. Evidently quality in health care is an important aspect in achieving customer and staff satisfaction. 

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The use of an accountability model is an appropriate way of achieving financial success. The nurses should assume the ownership of the budget targets and become part of the bandwagon designed to reduce labor costs. This model involves communicating and coming up with attainable expectations and evaluating them by posting outcomes. The nursing administration should assist the nurses in understanding their contribution to financial success. Repeated communication from the nursing leaders to the staffs develops an alignment where the team knows their role in delivering quality care while still maintaining cost along the budget line.

Accountability strategy is a daily practice that involves evaluating the expectations of the staffs, sending a daily report on the actual working hours and the expected working hours. The reports will assist the administration in understanding how the budgeted hours are spent and to know how to structure the units to work within the budget line. The nursing directors will be device action plans for the sectors that are noted to be crossing the budget line. Coaching the staffs in the different units on how to maintain the budget targets will still assist in the maintenance of the necessary patient care. 

Understanding the value of every item in the medical department prevents loss of the supplies and wastage of resources by taking out more materials than they require. Zero-based budget, develops a list of supply materials, the quantity and how to reuse the supplies minimizing wastage. It is a method that assists in calculating the total expenditure using the anticipated number of processes to be achieved.  The health care organization can also save on cost by searching for alternative methods of service delivery in the instances of staff shortages. The use of supplemental staff or nurses from in-house registries with a lower salary rate eliminates the cost of recruiting and orientating new employees.

Creating a journal of activities of different time increments in a shift assists in identifying practices that are cost effective and efficient. The journal of activities also establishes the amount of time spent on patient care and other activities. The nursing administration will use the journal of activities to organize processes that will improve the unit, and they will know how to balance the budget of different activities. The staffing model is an example of a strategy that outlines the number of staffs required. The nurse to patient ratio is used to analyze productivity; the technical assistant reduces the number of procedures (Kelly, 2012, p.334). The general salary expense decreases when using a technical assistant since they require a lower salary.

Using the value portfolio will result in multi-disciplinary improvement in a unit. Training of the caregivers is the best development methodology that reduces misuse of supplies and reduces the time used in different procedures. The portfolio ensures that there is the delivery of primary nursing care and that there are no cases of missed care.  Value portfolio a method that is set to improve the units’ delivery and reduce the time spent on a procedure. Reducing the process time will eliminate the extra cost spent on overtime from the nurses. Standardizing the roles and developing skill mix will reduce the labor and supply expense (Goetz, Janney & Ramsey, 2011, p.182). Productivity not only reduces labor cost but it also ensures that the infection rates decreases. 


Leadership is the cornerstone of achieving financial success. The administration influences the activities and establishes strategies that improve the work of the staffs. Financial improvement involves advancing the safety of the patients, ensuring that the workforce is engaged and minimizing the costs. The nurse leader is responsible for setting objectives and ensuring that the members accomplish the goals. Motivation is also an important element in leadership; it creates a sense of ownership for the staff. The nursing staff will feel like they are part of the team and will be motivated to work accordingly. Labor cost is a major factor in regulating expenditure; it is, therefore, important to develop strategies that will ensure that these expenses are in check.

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  1. Goetz, K., Janney, M., & Ramsey, K. (2011). When nursing takes ownership of financial outcomes: Achieving exceptional financial performance through leadership, strategy, and execution. Nursing Economics29(4), 173.
  2. Kelly, P. (2012). Budget Concepts for Patient Care. In C. Haviley (Ed.), Nursing leadership & management (pp. 322- 341). Clifton Park, NY: Delmar Cengage Learning.
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