ABSTRACTThis article assesses the policy strategy for local management of schools in Victoria, Australia within the high involvement framework for creating high performance organizations. The high involvement framework as adapted to education hypothesizes that a decentralized strategy for improving educational performance requires decentralizing four key resources: power over the budget and personnel functions; information about revenues, expenditures, costs and best practices; knowledge and skills including both technical and business knowledge; and rewards including compensation and other incentives. The framework also includes an instructional guidance framework of curriculum standards and student assessment to those standards, and facilitative principal leadership. Based on two years of data collection at both the state and school levels, focusing on governance, management, finance, and curriculum and instruction, the study found that Victoria's Schools of the Future ranked high on all six variables, and that the decentralization process was working smoothly and major changes were being made in curriculum and instruction when school sites also ranked high on the six variables*This article is based on a presentation to the American Educational Research Association, New Orleans, Louisiana, April 1994. The research reported in this article is sponsored by the Consortium for Policy Research in Education (CPRE), under a grant from the Carnegie Corporation and cooperative agreement #R117G10039–91 from the Office of Educational Research and Improvement, U.S. Department of Education. The opinions expressed are those of the authors and are not necessarily shared by CPRE, its institutional partners, the Office of Educational Research and Improvement, the U.S. Department of Education nor the Carnegie Corporation.