Discussion: The Financial Health of an Organization

How do you determine if an organization is healthy, from a financial perspective? For example, an organization might bring in a phenomenal number of sales in a given year and, at first glance, most people might consider that organization to be in a healthy position. But how might that perspective change if it were discovered that the overhead costs were out of control? Or, what if the organization took out an enormous amount of debt? Are these circumstances negative or positive, or does that depend on other factors and interpretations? In this Discussion, you will use your own definition of financial health to consider examples of financial health practices for a selected organization.

To prepare for this Discussion:

• Reflect on any knowledge or experience you have related to the concept of financial health.
• Consider an example from an organization with which you are familiar. (Note: It could be one where you have worked, or about which you have sufficient information to bring one or more examples into this Discussion.) Then select two or more examples of practices employed by that organization that were reflective of financial health or a lack of financial health.
• Reminder: Be sure to be aware of any personal biases you may have about the organization or definitions of financial health you discuss this week. Also, be sure to support your assertions using an evidence-based approach.

By Day 3

Post an analysis of a selected organization’s financial health practices, being sure to address the following:

• Briefly define, in your own terms, what financial health means from an organizational standpoint. Include in your definition the specific factors that would be taken into consideration when assessing an organization’s financial health and stability. In other words, what would you need to show to demonstrate that an organization is healthy?
• Identify two or more financial practices (good or bad) of an organization with which you are familiar, and categorize each practice based on your definition of organizational financial health, including a rationale for each categorization. Be sure to provide specific examples.

Note: When using specific examples from your professional experience, be sure to disguise the names of any individuals or organizations and/or any proprietary or sensitive information.

Refer to the Week 4 Discussion Rubric for specific grading elements and criteria. Your Instructor will use this grading rubric to assess your work.

Read some of your colleagues’ postings.

By Day 5

Respond to two or more of your colleagues’ posts in one or more of the following ways:

• Offer an insight you gained from your colleague’s definition of financial health and the factors that they determined should be considered in assessing an organization’s health.
• Offer an insight you gained from your colleague’s analysis of the financial practices of an organization.