Analyzing Capital Investments
Principled Investing to Maximize Organizational Impact
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The pace of technological innovation continues to escalate, with higher price tags and shorter product lifecycles, intensifying the focus on capital allocation at hospitals and health systems. The capital funding environment continues to remain tenuous, and, ironically, institutions are often investing precious capital dollars in technologies and programs that are underutilized or otherwise fail to deliver expected results. If capital investments are to yield stronger returns, leaders on the front line and in the management ranks must increase their understanding of funding constraints, improve their ability to analyze diverse opportunities, and prioritize those investment proposals that will generate sufficient cash flow or cost savings to fund the next generation of investments. This course will advance these objectives by providing an understanding of the key financial concepts used in capital budgeting, as well as of the impact of underlying assumptions on financial analysis of potential investments.
Learning objectives for participants
- Recognize sources and constraints of capital funding
- Identify the impact of underlying assumptions on financial analysis
- Understand key financial concepts (E.G. payback period, discounted cash flow)
- Prioritize investments generating greatest returns to the institution
Course content and teaching methodology
This course incorporates classroom presentation, interactive exercises, and group discussion. The following topics are among those included in this course:
A new outlook on capital investing
- Understanding the sources and constraints of capital funding
- Recognizing the need to maintain key financial ratios to raise future capital
Mastering financial concepts
- Defining core methods of payback period and discounted cash flow analysis
- Assessing importance of underlying assumptions and impact on investment decisions
Analyzing investment proposals
- Applying financial concepts to evaluate and prioritize diverse capital requests
- Identifying critical assumptions driving analysis; determining sensitivity