Develop A Brief Synopsis Of A Project You Would Like To Prop

Develop A Brief Synopsis Of A Project You Would Like to Propose To You

Develop a brief synopsis of a project you would like to propose to your potential company’s facilities planning oversight committee. The facilities planning oversight committee is multidisciplinary and includes the finance director, facilities planning director, a construction project manager, environmental health and safety director, and others from the institution. You may use the NPV or IRR method to calculate and determine if the project is an acceptable investment. The project synopsis should be short and include the following: the cost of the piece of equipment or product you are proposing, the lifespan of the equipment or product (in years), the amount in which cash flow will increase, and the percentage of ROI you want to achieve. The project analysis should include the reason the equipment or product should be purchased based on the analysis, your mathematical work, the product chosen and why that product was chosen, and the method that was chosen (the NPV or the IRR method) and why it was chosen. Your case study assignment should be a minimum of 500 words in length, not counting the title and reference pages. Use a minimum of two sources with at least one source from an online library (one may also be your textbook). All sources used, including the textbook, must be referenced, and paraphrased material must have accompanying in-text citations.

Paper For Above instruction

In the pursuit of enhancing operational efficiency and safety standards within our healthcare facility, I propose the acquisition of an advanced sterile processing equipment, specifically the Automated Endoscope Reprocessor (AER). This equipment is crucial for maintaining compliance with infection control standards, reducing turnaround times, and ultimately improving patient outcomes. The proposed AER has an associated cost of $150,000, with an expected operational lifespan of 10 years. The investment is projected to increase cash flows by approximately $30,000 annually due to increased productivity and reduced manual labor costs. Aiming for an attractive return, I target an ROI of 20%, aligning with our institutional financial goals to sustain investments that deliver significant value.

The primary rationale for purchasing this Automated Endoscope Reprocessor stems from the urgent need to improve the efficiency of our endoscopy unit's sterilization process while complying with stringent health regulations. Currently, manual cleaning and sterilization methods are time-consuming, prone to errors, and increase the risk of infection transmission. The new AER uses sophisticated automation to streamline these processes, ensuring consistent sterilization quality and decreasing turnaround time from hours to under 30 minutes per cycle. This efficiency gain facilitates increased patient throughput, reduced staff workload, and enhances safety standards, making it an indispensable asset for our facility’s quality improvement initiatives.

To evaluate the financial viability of this investment, I performed a Net Present Value (NPV) analysis. The NPV methodology was selected over Internal Rate of Return (IRR) because it provides a clear valuation of the project’s net value considering the time value of money, which aligns with our institution’s focus on value-based management (Baker, Baker, & Dworkin, 2018). Assuming a discount rate of 8%, reflective of our cost of capital, and projecting cash inflows of $30,000 annually for 10 years, the calculation proceeds as follows:

\[

NPV = \sum_{t=1}^{10} \frac{CF_t}{(1 + r)^t} - C_0

\]

where \( CF_t = 30,000 \), \( r = 0.08 \), and \( C_0 = 150,000 \). Calculating each year’s discounted cash flow and summing yields:

\[

NPV = -150,000 + \left(\sum_{t=1}^{10} \frac{30,000}{(1 + 0.08)^t}\right) \approx -150,000 + 204,600 = 54,600

\]

Since the NPV is positive (\$54,600), the project is financially justified based on these assumptions.

The product was selected after evaluating several brands and models based on criteria such as sterilization cycle time, automation features, maintenance costs, and vendor support. The chosen model, the MedTech AutoClean 3000, offers the best balance of efficiency, reliability, and cost. Its shorter cycle times improve throughput, and its intelligent monitoring system ensures compliance with regulatory standards. This product was selected because it directly addresses our operational pain points while offering durability and ease of maintenance, contributing to long-term cost savings.

The NPV method was chosen because it provides a comprehensive measure of the project’s value, accounting for the time value of money and allowing direct comparison with other investment opportunities. While the IRR method was considered, it was deemed less appropriate in this context due to potential issues with multiple IRR solutions when cash flows are irregular or non-conventional. The NPV approach aligns with our strategic goal of maximizing return on investments within constrained budgets, offering a clear indicator of net value creation.

References

• Baker, J. J., Baker, R. W., & Dworkin, N. R. (2018). Health care finance: Basic tools for nonfinancial managers (5th ed.). Burlington, MA: Jones & Bartlett Learning.
• Ross, S. A., Westerfield, R. W., & Jaffe, J. (2019). Corporate Finance (12th ed.). McGraw-Hill Education.
• Henry, C. (2021). Choosing between NPV and IRR: Principles of investment analysis. Journal of Financial Planning, 34(4), 45-52.
• Healthcare Equipment Standards Authority. (2020). Best practices in sterilization and equipment maintenance. https://www.healthequipmentstandards.org
• American Society of Health-System Pharmacists. (2019). Sterilization equipment assessment guidelines. https://www.ashp.org