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May 2013

Performance measurement and management control in non-profit organisations

This report summarizes research undertaken within two non-profit organizations (NPOs): the Tennant Centre, which provides welfare services to the disadvantaged; and Voluntary Service Overseas, which addresses poverty alleviation in developing countries through volunteering.

We examine how formal performance measurement and management controls can have beneficial and damaging effects on social capital in these two NPOs. Social capital can take two forms: bonding and bridging. Bonding involves developing close interpersonal relationships based on shared aims, and bridging to building networks between the NPOs and other parties.

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Traditionally, the management of NPOs has relied on informal processes based on the shared norms and values of delivering humanitarian services, rather than on coercive or formalised procedures.

CGMA report

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