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When an agency is working to maintain its commitment to a central mission while funding patterns change and new types of activities are supported, they can utilize a performance-based budgeting strategy. There are variations of this strategy, such as budgeting for results, which attempts to make a direct connection between mission, goals, and objectives and detailed revenue and expenditure estimates. This type of budgeting is based on three main principles: specification of goals from the top, choices on means of accomplishing goals and objectives determined at the program level, and accountability and incentives for results. In order to utilize this type of budgeting it is important that there are clear and measurable objectives, and responsibility for their achievement needs to be clearly assigned to units, programs, or individuals. Having an appropriate program design is also essential for this form of budgeting. The design needs to have a history of being effective in the circumstances that are planned by the program. Finally, managers and their staff need to have the responsibility and authority to do what is needed to achieve the objectives (Lewis & Lewis, 2011). Utilizing a financial strategy, such as budgeting for results, would allow an organization to change its programs with its funding. However, it is important that an agency is able to maintain the connection between its funding and its mission, goals, and objectives. Otherwise, they are losing sight of why the agency was created in the first place.
Lewis, J. A., Packard, T. R., & Lewis, M. D. (2011). Management of human service programs. Cengage Learning.
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