Factors Needed to Estimate the Base Cost of Renovation in Hospital Setting
There are some aspects that need to be considered when making a decision to renovate a hospital. These factors should be part of a detailed business plan and therefore they should be weighed before any primary action is taken. A comprehensive explanation of the factors to be put into consideration are as follows;
Cost
A clear understanding of all cost is vital in developing a budget and determining the correct action to be taken. Costs that need to be considered are; furnishing, construction and the design fees. A present value examination should be put in place to aid in determining the relative advantages of the renovation.
Urgency of Need
The relative urgency of the services required will direct the decision for renovation. If there is less urgency, a longer period of time will allow for renovation to take place. In addition, it provides an ample time so that the correct measures and decisions to be made ( Douma and Schreuder, 2012).
Type of Funding and Availability
Income from the daily operations, grant funding and departmental funds are normally used during the renovation projects. In some instances, system facilities revenue bonds may be used to finance these projects and at a later time these bonds can be repaid with the facilities together with the administrative costs.
Extra Services to be Rendered
During renovation, the added costs of providing additional services should be factored when making the decisions. Some of the extra services include; obtaining a secure internet access, computing services, security and parking. All these services create additional costs that should be well accounted for in the budget.
Estimation of the Total Project Cost
When determining the cost of the renovation activities, a clear record should be reflected on the budget of how much fund is needed and how it is spent. When estimating, the following should be accomplished;
Calculation should be done to approximate the tangible return on investment. This will aid in finding out how the funds would be raised and how they would be repaid.
Accurately quantifying the real clinical and health needs that should be addressed immediately.
Identifying a wide range of sustainable planning techniques and pricing the soft, hard and the hidden costs of the techniques stipulated (Wouters, Tesluk and Buyens, 2007).
Critical analysis of the tradeoff costs and the facilities that need to be upgraded in order to uplift the face of the business.
References
Douma, S., &Schreuder, H. (2012). Economic Approaches to Organizations: Economic Decision
Making within the Firm. (5th Ed), New York: Prentice Hall.
Wouters, K., Tesluk, P. E., & Buyens, D. 2007. Managerial Learning from High Responsibility
Assignments: The Role of Perceived Challenge and Emotions of Pleasant Activation.
