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• Leading schools
  • Managing schools
    • Helping schools use resources well
      • Securing the best for less
      • The principles of school finance
      • Financial planning and budgeting
      • Strategic financial management and budgeting
      • Financial monitoring, reporting and evaluation
      • Cash management
      • Evaluating financial resource management
      • Creating capacity for strategic and operational leadership
      • Procurement
      • Personnel and benefits management
      • Leading learning and teaching
      • Managing the organisation
      • Effective use of resources: case studies

Evaluating financial resource management

Evaluating the allocation and use of financial resources is an essential part of effective school business management. This article explains different approaches to evaluation and introduces the concepts of best value, benchmarking and effective procurement.

Evaluation framework

Evaluating the use of financial resources informs budget planning and encourages schools to consider whether their expenditure relates to their priorities. To deliver value for money, schools need sound financial management practices for the control of resources and accounting, plus effective processes for making use of resources. They also need to have the ability to innovate in response to changes in the financial environment.

Measuring inputs, outputs and outcomes

Evaluating the effectiveness of financial management and resource allocation is a complex process that should reflect educational outputs and outcomes for children and young people. By considering inputs, outputs and outcomes, you will build a greater understanding of how to meet both government requirements and your individual school’s needs.

• Inputs are the costs of the resources used to educate the students.
• Outputs are the direct effects on the students in relation to their knowledge acquisition, skills, beliefs and attitudes. The most frequently-used measurements of outputs are examination results and test scores.
• Outcomes are the longer-term impacts on the individual, such as employability and earnings

Best value and benchmarking

Best value is about developing a partnership process between a school and its key stakeholders to ensure that it continually reviews, challenges and improves the use of resources in order to raise standards and drive continuous improvement. It involves asking questions such as:

• What do we need to achieve? What evidence do we have about levels of need?
• Why are we doing this? Are there better ways to achieve the desired results?
• Are current methods the most economical, efficient and effective?

Benchmarking is a way of highlighting differences in practice and opportunities for improvement.

Effective procurement

Many schools have developed their own procurement strategies, both for minor and major expenditure. Others retain close links with the procurement services of their local authority. There are two main areas where schools can gain procurement efficiencies:

• reducing the costs of the procurement process through good procurement practice
• adopting approaches to procurement that reduce the cost of the resources

E-procurement can support good procurement practice, for example by streamlining supplier selection and purchasing processes to make them more efficient and effective.

Whole-school engagement

A whole school approach is essential for effective resource allocation and management. The actions of the school business manager (SBM) and the senior leadership team should encourage other staff to see financial management and controls as an enabling process rather than a constraint on teaching and learning.

The SBM must ensure that all financial information is presented on time and in a format that enables others to understand, appraise and evaluate their use of resources.

Further information

• Advanced Diploma of School Business Management