Importance of KPI in Budgetary Management

Solution focused
Counselling

Contents
Introduction......................................................................................................................................3
Main Body.......................................................................................................................................3
Conclusion.......................................................................................................................................3
References........................................................................................................................................4

INTRODUCTION
Planning is an important aspect for each and every corporation functioning within the
confines of an economy. Within the health care sector also, it plays a crucial role in ensuring that
the management and recording of patient’s data is done in an effective manner so that the same
can be used in future context. The present project is based on the case study of Orion Health
which has been acknowledged as a New Zealand based international software corporation which
is engaged in delivery and sale of health care software. The project is divided into two tasks. The
first task is concerned with techniques of planning to launch a project. The second task shows the
importance and link of KPI in budgetary management.
ASSESTMENT 2
Link between KPI and Budget
Performance indicator or also referred to as Key Performance Indicator (KPI) can be defined
as a method of performance measurement used by a large number of companies across the global
periphery. This method is widely put to use for the purpose of monitoring operations or for
measurement of focus in alignment with organizational performance which are regarded as the
most crucial aspects for the success of a company in present as well as future context. Key
Performance Indicators are put to use by a company for the assessment of performance of an
organization in terms of their division, staff, department, operational unit, department etc. They
tend to provide evidence regarding the achievement or non achievement of results and lay down
foundation for the attainment of intended output. Also, Key Performance Indicators tend to
render aid in perceiving the difference, improvement or development that has its association with
a targeted change within a specific context. Further, Key Performance Indicators also encompass
data which reflects the alterations like variables or factors. This is an important part of budgetary
management and provides assistance to an enterprise in doing financial planning in a manner
such that budget is not exceeded. Orion Health is seen to be making use of KPIs for effective
budgetary management in the case study. With this, the entity has been able to control its costs
and ensure that the expenses and other aspects are in accordance with the budgeted figures.
There are several types of Key Performance Indicators within the confines of an entity
having their own description as well as characteristics. These are identified as being the non
financial measures which cannot be stated in money terms. Across the globe, many companies