Analytic Quality Glossary A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Home
Citation reference: Harvey, L., 2004-24, Analytic Quality Glossary, Quality Research International, http://www.qualityresearchinternational.com/glossary/
This is a dynamic glossary and the author would welcome any e-mail suggestions for additions or amendments.
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Value for money
Value for money assesses the cost of a product or service against the quality of provision.
Value for money tends to be equated with value for money expended, although it could take into account ‘real’ cost including hidden costs and opportunity costs.
Value for money is one definition of quality that judges the quality of provision, processes or outcomes against the monetary cost of making the provision, undertaking the process or achieving the outcomes.
According to the University of Cambridge (2010),
'Value for money' (VFM) is a term used to assess whether or not an organisation has obtained the maximum benefit from the goods and services it both acquires and provides, within the resources available to it. Some elements may be subjective, difficult to measure, intangible and misunderstood. Judgement is therefore required when considering whether VFM has been satisfactorily achieved or not. It not only measures the cost of goods and services, but also takes account of the mix of quality, cost, resource use, fitness for purpose, timeliness, and convenience to judge whether or not, together, they constitute good value.
Erlendsson (2002) states:
Value for money (VFM) is a term used to assess whether or not an organisation has obtained the maximum benefit from the goods and services it both acquires and provides, within the resources available to it.
He goes on to add:
Some elements may be subjective, difficult to measure, intangible and misunderstood. Judgement is therefore required when considering whether VFM has been satisfactorily achieved or not. It not only measures the cost of goods and services, but also takes account of:
- the mix of quality, cost, resource use,
- fitness for purpose,
- timeliness, and
- convenience to judge whether or not, together, they constitute good value.
Value for money is one definition of quality (Harvey & Green, 1993):
Quality as value for money sees quality in terms of return on investment. If the same outcome can be achieved at a lower cost, or a better outcome can be achieved at the same cost, then the ‘customer’ has a quality product or service. The growing tendency for governments to require accountability from higher education reflects a value-for-money approach. Increasingly students require value-for-money for the increasing cost to them of higher education.
Campbell and Rozsnyai, (2002, p. 23) also identify a value-for-money definition of quality:
Quality as value for money. The notion of accountability is central to this definition of quality with accountability being based on the need for restraint in public expenditure, (Lomas, 2000).
Value for money is often linked to efficiency.
Campbell, C. & Rozsnyai, C., 2002, Quality Assurance and the Development of Course Programmes. Papers on Higher Education, Regional University Network on Governance and Management of Higher Education in South East Europe, Bucharest, UNESCO.
Erlendsson, J., 2002, Value For Money Studies in Higher Education http://www.hi.is/~joner/eaps/wh_vfmhe.htm,
Harvey, L. and Green, D., 1993, ‘Defining quality’, Assessment and Evaluation in Higher Education, 18(1). pp. 9–34.
Lomas, L. 2002 ‘Does the development of mass education necessarily mean the end of quality?', Quality in Higher Education 8(1).
University of Cambridge, 2010, A Brief Guide to Value for Money (summarised from HEFCE website) available at http://www.admin.cam.ac.uk/offices/secretariat/vfm/guide.html, accessed 22 September 2012, page not available 12 January 2017.