Question：Big Heath School (BHS) is a publicly funded secondary school located in the suburbs of a large industrial
　　city in a developed country. The School does not charge any fees to its pupils, who are drawn from the
　　local community.
　　The school has a small management team that reports to the Board of Governors. The management
　　team is made up of the School’s head teacher, two deputy head teachers, a finance manager and a
　　facilities manager. The makeup of the Board of Governors is determined by central government and
　　consists of representatives of the teaching staff, the teaching unions, parents, and local businesses, as
　　well as a political appointment.(a) Discuss the problems with performance measurement of not-for-profit organisations such as BHS.
　　(8 marks)
　　The School is considering introducing a Value For Money audit to examine the economy, efficiency and
　　effectiveness of the School.
　　解析：(a) Problems with performance measurement for not-for-profit organisations
　　Multiple objectives
　　The various stakeholders in an organisation may have differing or even conflicting objectives. For
　　BHS, the stakeholders will include teachers, unions and local businesses, who may have very
　　differing objectives for the school.
　　Measuring outputs
　　It may be hard to measure output in a way that is meaningful. For example, the output of BHS
　　may include well rounded individuals who contribute to society - this may prove challenging to
　　measure!
　　Lack of profit measure
　　If an organisation is not expected to make a profit, or if it has no sales, traditional financial
　　measures are meaningless. BHS has neither sales, nor is it expected to make a profit..
　　Nature of service provided
　　Many not-for-profit organisations provide services for which it is difficult to define a cost unit. It
　　may be hard to produce a single meaningful cost per unit measure for BHS.
　　Financial constraints
　　Although every organisation operates under financial constraints, these are more pronounced in
　　not-for-profit organisations. BHS will be constrained in its borrowing more than a commercial
　　organisation, indeed its charter may not allow borrowing at all. This could mean that they are not
　　able to finance the same initiatives as a profit making organisation.
　　Political, social and legal considerations
　　Unlike commercial organisations, public sector organisations are subject to strong political
　　influences. For example, the school will be required to implement government policies.
　　The public may have higher expectations of public sector organisations than commercial
　　organisations. This may be exacerbated if the public has no choice in service provider. For
　　example, there may be no choice for local residents, as to where they can send their children to
　　school without paying fees.
　　The school will be required, through legislation, to provide a range of services. Most commercial
　　organisations are not subject to such constraints.