Successful organizations, public and private, monitor their operations--extensively and intensively. UPS and FedEx know where every package is in transit. Dell is famous for running an extremely tight supply chain, pushing the cost of holding inventory onto its suppliers by having a crystal clear understanding of its immediate requirements and only ordering what it needs when it needs it. Baseball teams employ sophisticated statistical analyses in making personnel decisions.

Compare such approaches to what has long prevailed in public education. In 2007, Michelle Rhee, then the new chancellor of the Washington, D.C. Public Schools, reported that millions of dollars worth of textbooks and supplies had been moldering, unnoticed, in a warehouse for months and years. Few districts understand their true costs of recruiting a new teacher and principals have little idea what their schools' actual budgets are. . .

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Frederick M. Hess is the director of education policy studies at AEI. Jon Fullerton is executive director of the Center for Education Policy Research at Harvard University.