ABSTRACT

The third sector (TS) is fast growing and increasingly important for the delivery of public services. Consequently, enhanced performance inTS organisations becomes more vital to their role. In this chapter we discuss the challenges of performance measurement (PM) in the sector and examine the relationship between performance and funding for organisations operating within it.We focus on UK-based advocacy services to provide the practical context for the chapter.These are services which seek to secure equality for vulnerable or marginalised groups of people;we articulate a taxonomy of advocacy services and use this to illustrate the discussion.The chapter draws on existing academic knowledge about performance measurement in order to investigate the particular needs of the TS.We argue that the characteristics of advocacy provision in particular, and ofTS services in general, require the adoption of a multiple stakeholder perspective in the measurement of performance.We further argue that by understanding the varying stakeholder performance requirements, third sector organisations (TSOs) can maximise their chances of securing funding.To this end we draw on stakeholder theory to develop our arguments. The chapter aims to raise awareness among the scholarly community of the issues

surrounding performance measurement in TSOs and to simulate further research that will have both academic value and practitioner impact. It contributes to knowledge in a number of ways. First, we develop a picture of the research landscape which incorporates funding, stakeholders and performance measurement in theTS. Second, we provide a taxonomy of advocacy services accompanied by a discussion of performance measurement issues within this that highlights the need for appropriate measures to be developed. Finally, we propose a conceptual model which incorporates the relationships between stakeholders, performance and funding in this sector. In a research companion, such as this, this chapter represents a firm foundation on which future work may build. After the introduction, the chapter is organised as follows.Drawing primarily on

material from Taylor and Taylor (2013),1 the second section describes the TS landscape in the UK before discussing the central issues of performance measurement, organisational stakeholders and funding within it. In order to illustrate this

literature-based discussion, the third section provides an account of advocacy services in the UK and explores how the three central issues are linked in practice in this environment.The chapter concludes with presentation of the proposed conceptual model.