Cost Per Output and Cost Per Outcome Essay
Cost Per Output and Cost Per Outcome
Cost per output and cost per outcome calculations valuable to human service agencies, because resources are limited, human service agencies need to make the best cost per output and cost per outcome. Human service agencies are usually not-for-profit and perform social service for the benefit of society. Hence value for money is important so that public funds/donations get their real worth -or the Human Service agencies would be wasting money and then the public will stop donating. Cost per outcome and cost per output tells their overhead for services. Human service agencies are going to need donations to cover these costs. Cost per output and outcome calculations can provide insight into a human service organization’s financial management plan in order to evaluate whether or not the goals and objectives are being met to provide the services which support the mission.
Outputs and outcomes provide the information about the services, how they are implemented, and whether or not they are financially sound to the organization. Divisions of labor, services, and programming can be determined in order to ensure funds are allocated properly. Determinations can be made taking into account fixed and variable costs and how those affect the revenues. Quality of services can also be addressed using outputs and outcomes which determine the level of services and how the quality is affected through an increase in funding or a cutback. Not keeping track of the cost per output and cost per outcome could really cause a Human service agency a lot of problems. They will not have an enough funds to cover programs they may need or salaries of the employees.