Measuring Public Sector Performance Essay Example | Topics and Well Written Essays - 3000 words

Measuring Public Sector Performance - Essay Example Then, common models of performance measurement and how they were developed are investigated. Third, the public and private sectors are compared and contrasted to highlight similarities and differences in their functions, goals, and outputs. Fourth, key developments in private and public sector performance measures are reviewed and discussed to highlight the convergence in the efforts of each sector to address stakeholder expectations. The paper concludes with a set of observations that disprove the hypothesis by showing that performance measurement as a basis for financial accountability and management in both the private and public sectors has become more complex and difficult and provide challenges for everyone. Any discussion of organisational performance begins with an understanding of the nature of human organisations and why they exist. Like the human beings who establish them, every organisation exists for a purpose, a set of goals or objectives that has to be achieved. By custom and for analytical convenience, organisations are classified based on their main purpose; thus, there are private-sector, public-sector, not-for-profit, institutional, voluntary, and mixed organisations. Table 1 summarises each of these organisational types, their specific purposes, and some basic examples of each. Regardless of the type, an organisation can be ... Like the human beings who establish them, every organisation exists for a purpose, a set of goals or objectives that has to be achieved. By custom and for analytical convenience, organisations are classified based on their main purpose; thus, there are private-sector, public-sector, not-for-profit, institutional, voluntary, and mixed organisations. Table 1 summarises each of these organisational types, their specific purposes, and some basic examples of each. Regardless of the type, an organisation can be said to be successful if it meets the purpose(s) for which it is established, and with success comes its continued growth and existence. Otherwise, it would be better for an organisation that does not meet its purpose for existing to close down. This is where accounting as a management tool proves its usefulness because it helps provide public sector organisations with the means to measure performance (Jones et al., 2002). It helps any organisation determine whether it is meeting its purpose, and it is for this reason that management accountants have developed a growing body of organisational science around the notion of performance measurement. This was not, however, the case until in the previous century when increased globalisation and competition for limited resources pushed organisations to measure performance against their purpose for existence and in comparison with their competitors (Lothian, 1987; Fitzgerald et al, 1991). The term "performance" captures the notion of how an organisation operates in comparison to its purpose. Thus, performance measurement has been described (Neely, 1998; Kunz et al., 2002; Moullin, 2003) as an assessment of how an organisation performs and includes measures