University corporatisation: Driving redefinition

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Critical Perspectives on Accounting 22 (2011) 434–450

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Critical Perspectives on Accounting

journa l homepage: www.e lsev ier .com/ locate /cpa

niversity corporatisation: Driving redefinition

ee Parkera,b,c,∗

School of Commerce, The University of South Australia, AustraliaThe University of St Andrews, United KingdomAUT University, New Zealand

r t i c l e i n f o

rticle history:eceived 29 January 2009eceived in revised form 2 March 2010ccepted 10 November 2010

a b s t r a c t

Drawing on international research into changing university environments, profiles, andstructures, this study applies a neo-institutional perspective to the analysis and critiqueof underlying developed country trends in public sector university corporatisation andcommercialisation. Identifying primary environmental and historical influences, the paperfocuses upon key environmental factors that have promoted the importation of new pub-lic management and private sector philosophies into universities of which a significantproportion have been traditionally identified as operating within the public sector. Thefindings reveal an underlying neoliberal political and economic agenda, that has laid thefoundations for the profound transformation that has reconfigured universities’ gover-nance, missions, core values and the roles of their academics. These changes emerge asmimicking private sector corporate philosophies and governance structures, as well asreturning to scientific management approaches of a century ago. Accounting and account-ability are revealed as conduits supporting these significant shifts in university identityand role. Their realignment with shifting societal economic preoccupations and prioritiesis revealed as permeating their intellectual core, commercialising knowledge productionand transforming the identity and role of the academic community.

© 2010 Elsevier Ltd. All rights reserved.

. Introduction

From the late 20th century onwards, many universities in developed countries have experienced an arguably exponentialate of change in their environment, structures, strategies and processes. Emerging from a period of relatively sheltered exis-ence, serving predominantly elite and stable national markets, often supported to large degree by government funding, theyave been launched into a global educational market, and required to generate more actively their own constituencies andesources. Such actions have brought profound changes in their core values, fundamental missions and overall operations.

This paper addresses the apparent corporatisation and commercialisation of universities in developed countries includ-ng the UK, Europe, North America and Australasia since the 1980s. These have had particular impacts upon universitiesraditionally positioned as state funded entities operating in the public sector realm. The nature and magnitude of the recent
hift in university identity and role can be characterised in terms of culture, governance, structure and operational focus, ascorporatisation of universities, along with the commercialisation of their missions, objectives and operations. Particularly
or state owned and funded universities in the public sector, these changes not only represent dramatic reconstitutions ofhilosophy and societal roles, but also reflect fundamental forces that are not always entirely understood or fully appreciated.

∗ Correspondence address: School of Commerce, The University of South Australia, South Australia, Australia.E-mail address: [email protected]

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L. Parker / Critical Perspectives on Accounting 22 (2011) 434–450 435

Yet such understanding of the influences and paths that have brought universities into their current situation is importantfor informed decision-making and actions at all levels of university stakeholders: from governments, to communities, touniversity management, to academics themselves.

Accordingly, this paper aims to investigate and interpret the implications of underlying factors that have produced theprocess of university corporatisation and commercialisation. In doing so, the paper addresses five associated questions. Whatkey environmental factors have spawned the apparent radical transformation of university identity and focus? How hasgovernment played such a central role in motivating these changes? What are the corporate characteristics that universitieshave imported from the private sector? What historical origins do they appear to reflect? Finally, how are these influencesand changes reflected in the identity and role of academics serving within these institutions?

The study applies a neo-institutional sociology (NIS) theoretical lens to a considerable array of research into universityenvironments and changes over recent decades. The sources utilised include a range of published research that has variouslyemployed survey, interview, case study and historical methods. The countries embodied in these published sources rangepredominantly across European, North American and Australia and New Zealand nations, including some OECD studies, withparticular publicly available statistics and examples drawn from the Australian environment.

The paper and its major sections are structured around the above research questions posed. First it offers an outline of theNIS theoretical perspective that informs the analysis and then moves on to consider the contemporary tertiary educationenvironment that has spawned university transformations and the neoliberal revolution that produced this environment. Itthen addresses the question of public sector reforms and government agendas that have provided the backdrop to changein higher education. The importation into the university sector of private sector corporate concepts and philosophies is thenconsidered, and an argument made for its reflecting historical corporate governance approaches of the scientific managementschool. The impacts of these changes upon the role and identity of university academics is analysed, and finally the role ofaccounting as a conduit for university commercialisation and corporatisation is then addressed.

2. A neo-institutional sociology perspective

The examination of the redefinition of universities, as presented here, is informed by a neo-institutional sociology (NIS)perspective that has been developed and refined over the past 30 years. NIS contends that organisations pursue legitimacy,approval and funding from their general environment and culture (social, economic, political and institutional) and fromorganisations and constituents key to their survival and prosperity (Euske and Euske, 1991; Fogarty, 1996; Stone, 1991).Such pursuit takes place both formally and informally, with informal processes gradually becoming cemented into formalorganisational structures and processes, thereby becoming institutionalised. In their general tendency to conform to pre-vailing societal beliefs and values, where organisations find themselves functioning in similar environments, they also tendto gravitate towards establishing and institutionalising homogeneous structures and processes.

The organisational tendency to conform and homogenise is exhibited via one or more of three behaviour patterns:coercive, mimetic and normative isomorphism. Coercive isomorphism occurs when an organisation adapts and changes toconform to external pressures applied to it. Changes in values, behaviours, structures and processes can occur for exam-ple in response to pressures exerted by other organisations or groups upon which the organisation depends. These can forexample take the forms of laws and regulations applied by governments, performance standards imposed by monopoly sup-pliers or buyers, or strategies imposed by dominant sponsors or donors (Carmona et al., 1998; Carruthers, 1995; Cornforthand Edwards, 1999; DiMaggio and Powell, 1983; Fogarty, 1996; Steane and Christie, 2001). Mimetic isomorphism refersto a pattern of behaviour where an organisation voluntarily imitates other groups’ or organisations’ values, characteristics,behaviours, structures or processes. It may include echoing currently accepted community ideas and values, adopting a fash-ion or custom in the industry or community, or copying another organisation’s apparently successful strategy. Normativeisomorphism represents another route to organisational conformity and homogeneity that takes place through the beliefsand actions of key groups within its own organisational members. Specific member groups (e.g. Professional, administrative)that share particular common professional training, background, or norms, may import those into their employing organisa-tion. These will reflect their profession’s wider norms and values transmitted through its disciplinary paradigms, networks,and education of its profession members (Carmona et al., 1998; Carruthers, 1995; Cornforth and Edwards, 1999; DiMaggioand Powell, 1983; Fogarty, 1996). These isomorphic behaviour patterns may of course combine. For example one power-ful organisational group, namely senior management, may for example interact directly with key external environmentalstakeholders and factors to translate pressures for organisational change coming from outside the organisation into internalorganisational implementation, thereby combining both coercive and normative isomorphisims (Modell, 2001). Similarly,organisational members may take on board the legal and cultural rules and expectations of the society around them througha process of both coercive and mimetic isomorphism, so that the social values and expectations of government, consumersand other external stakeholders become reified as organisation members’ own social reality. The organisation then becomesshaped and institutionalised by its environment (Dambrin et al., 2007; DiMaggio and Powell, 1983; Scott, 2001; Scott andMeyer, 1991).

Within organisations, NIS argues that operational and financial management processes increasingly formalise and becomeinstitutionalised as the organisation seeks to project an image of rationality and compliance with convention. The whole raftof organisational planning, control and performance measurement systems play this role, from strategic plans, to budgetingsystems, to costing systems to human resource management systems and onwards. These all serve to project an image of

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36 L. Parker / Critical Perspectives on Accounting 22 (2011) 434–450

ationality and compliance with government, industry, professional and societal conventions. In addition they reinforcehe organisation’s efforts to reduce ambiguity and uncertainty in its internal and external environment, induce cohesiveehaviour amongst its workforce, and by projecting an image of rationality win general stakeholder approval for its existencend behaviour (Carmona et al., 1998; Euske and Euske, 1991; Stone, 1991). In so doing, the organisation strives to maintain anmage of efficient and rational management that attracts approval and support from those it identifies as its key stakeholdersCarruthers, 1995; Covaleski and Dirsmith, 1986; Fogarty, 1996; Greenwood et al., 2002; Kostova and Roth, 2002; Meyernd Rowan, 1977; Scapens, 1994).

However, all is not plain sailing. Formal institutionalised organisational structures and processes have been observedt times to exist decoupled from what in fact occurs within an organisation. Actual informal organisational structure androcesses may differ significantly from the formal, reported structures and processes that simply act as symbolic windowressing presenting a mythical, ceremonial image to placate outsiders. Decoupling may serve a range of organisationalurposes. They can include mustering support from targeted potential stakeholders, circumventing major potential conflictsithin the organisation, or preserving flexibility in how it can respond to emerging contingencies while at the same time

utwardly presenting legitimising formal processes (Carruthers, 1995; Covaleski et al., 1993; Meyer and Rowan, 1977).While offering unique potential insights into organisational processes and philosophies, NIS, as with any theoretical lens,

oes have its limitations. Some consider it to present a rather deterministic theorisation of organisational isomorphism thatoes not sufficiently consider processes of institutionalisation and account for differing organisational characteristics andtyles of institutional change. It is also questioned for its assumption of the prevalence of decoupling and the degree ofttention it pays to the locus and operation of groups and power in the organisation (Abernethy and Chua, 1996; Carruthers,995; Clegg, 1989; Covaleski et al., 1993; Perrow, 1986). In its defence it can be argued that NIS does recognise the possibilityf co-existing multiple values and practices within an organisation (Cornforth and Edwards, 1999). As far as the process ofnstitutionalisation goes, Oliver (1991) has argued that NIS does acknowledge the potential for various forms of organisationalesistance to external environment change that range from defiance to avoidance, to manipulation, to compromise, or tocceptance. An organisation’s managers may for example refuse to comply passively with externally produced coerciveressures to conform, instead employing a range of avoidance and evasion tactics (Modell, 2001; Powell, 1991). By so doing,n organisation can diverge from simple conformity with societal values or industry norms, choosing instead to includeoth elements of decoupling between formal and informal values and activities, and alignment of informal with formallyresented values and activities.

With respect to NIS’s attention to organisational change, Scott (2008) argues that while the focus of institutional researchas tended to be on organisations’ reproduction of stability and order, nonetheless they undergo change prompted fromxogenous and endogenous sources. Thus an NIS perspective is capable of accommodating investigations of the effectsf varying and changing organisational contexts in terms of both convergent and divergent changes across organisations.ounsbury (2008) too, recognises the multiplicity of institutional environments and cultural beliefs that can influence organi-ational managers’ decisions and actions. This feature of NIS has particularly facilitated this paper’s analysis of key underlyingrivers of university corporatisation.

Further criticisms of the neo-institutional approach have been made by Kirkpatrick and Ackroyd (2003) with respect tohat they see as a largely functionalist analysis of organisational structures and change, the telegraphing of observations

f professional accounting and law firm behaviour to public service organisations operating in quite different contexts, theresumption of a move towards a dominant new archetype – the managed professional business, a failure to account forolitical instability as a normal feature of group differences within organisations and inadequate recognition of the oftenbserved weak commitment to management objectives in such areas as the public sector. Scott (2008) and Lounsbury (2008)oo, point to subsequent developments in institutionally based research that has moved beyond NIS’s original overstatementf the coherence and uniformity of environmental impact on organisations to recognise the complexity and variety ofnvironmental influences and organisational responses enacted through organisational members’ decisions and practices.hus multiple competing logics have been found to permit competing agendas and actions by organisations and theirembers. Thus in this paper we see the coexistence of common environmental drivers of university change along with

ome diversity in nature and degree across different national situational contexts.A considerable array of both theoretical and empirical studies in the NIS tradition over several decades has therefore pro-

ided a more multidimensional and less deterministic theorisation of institutionalisation and organisational change thanriginally presumed by the theory’s observers. The process of institutionalisation has indeed been found to be more complexnd non-linear than the theory’s initial specification. Ideals, discourse and management control systems can be dissonantnd yet co-existing, although formal institutionalisation of change still tends to proceed more directly and completely whenhese fall into mutual consistency. Organisational performance indicators and related control systems may perform a largelyeremonial role, decoupled from internal functions and performance, internal operations and associated management con-rol systems may adjust to align more closely with the changing externally reported key performance indicators (KPIs). Overime the organisation may gradually change between these two scenarios, with both prior held internal values and activitiesetaining currency for at least a time alongside ceremonial formal new reported strategies and performance indicators, but
ith change in both occurring over time such that decoupling reduces as new values, systems and structures gradually
ecome internalised by organisational members (Dambrin et al., 2007). NIS, as originally conceptualised and subsequentlyeveloped and elaborated, therefore offers a rich contextualised theoretical frame of reference for examining and critiquinghe commercialisation of the university sector internationally.


3. A transforming educational environment

Universities in many developed countries have been operating in an environment where government and public sectorbureaucracy has been reinventing itself in the form of what is termed New Public Management (NPM), market-based publicadministration, and managerialism. The key features of reinvention have been a focus on outcomes and related value-for- money in government expenditures, outsourcing of former government activities to the private sector, devolution ofdecision-making authority from central government with accompanying strengthened accountability and controls, a userpays philosophy, and market based competition for purchase and delivery of goods and services. Evident trends in many suchcountries have included corporatisation of some formerly budget dependent government organisations, publicly deliveredservices being commercialised, goods and services being constructed and delivered through public-private partnerships,public sector assets and organisations being sold, and income taxes and government expenditure being reduced (Englishet al., 2005; Lynn, 1998; Neumann and Guthrie, 2002). The pervasiveness of these trends are exemplified in countriesincluding Australia, Canada, Eastern European countries, Ireland, Italy, New Zealand, Spain, Sweden, Netherlands, the UKand the USA (English et al., 2005). Indeed in the USA 50% of the 9000 post-secondary educational institutions are for-profitorganisations (King, 2008). Thus institutionally, universities have been subject to a combination of exogenous forces thatreflect multiple layers of changing institutional context, as NPM has become a dominant philosophy and discourse in publicsector organisational management, then percolating through to university missions, structures and processes.

The pervading underlying government and community philosophy has been one of reducing government’s direct role inprovision of social, educational, health and other services, aiming for (but not necessarily achieving) a smaller public sector.The underlying agenda has been a pursuit of greater efficiency and effectiveness of product and service delivery, particularlyseeking greater outcomes for less input cost. That agenda reflects an evident belief amongst politicians and bureaucrats alikein the efficacy and applicability of the business model of organisational structure, planning, control and performance mea-surement (Chow et al., 2005; English et al., 2005; Ter Bogt and Van Helden, 2005). Price and cost have become the dominantpolicy and strategy determinants, with performance and outcomes being translated in largely quantitative economic terms.These commercial concepts and their associated language, reflect an economic rationalist approach to government policyand its delivery. Direct government provision and control of many services has been replaced by a de-volution of responsibil-ity for their provision to the market, with government control being retained through a complex web of market incentives,indirect performance indicators and accountability systems (Chow et al., 2005; English et al., 2005; Neumann and Guthrie,2002). Thus universities have found themselves being reconstituted initially through coercive pressures for reduced gov-ernment budget dependence and greater value-for-money, which have also translated into mimetic isomorphism as marketfollowers copy market leaders in commercialisation.

The higher education sector variously reflects the marketisation of government through reduced levels of direct govern-ment funding, grants, and subsidies, and consequently greater reliance on market generated revenues (Gray et al., 2002).Governments increasingly drive universities to seek outside non-government funding. For example the UK governmentoperates a scheme where it offers three levels (1:1, 2:1, and 3:1) of government subsidy for external funds raised, so thatif for example a university raises £6m, it can be awarded a further £3m in government funding (Funding Education, 2010).Universities around the world now find themselves working in an environment where education has become an interna-tionalised, global commodity, accrediting pressures drive universities in many countries to emulate the North Americanand Anglo-Saxon educational and research models, governments increasingly reduce their funding participation in favourof market driven university funding, and education as a marketable service replaces its former public good definition (Sporn,2003). Commercial strategies include teaching and research becoming translated into calculable revenue generating func-tions, community linkages and networks exploited for consulting income, intense competition for students and resources,fee charging for educational services, strategic alliances with industry, and aggressive expansion into international mar-kets. Having triggered an entrepreneurial university environment, government has simultaneously retained a high degreeof indirect control via oftentimes proliferating performance reporting and accountability systems (Gray et al., 2002).

From an NIS perspective, in these trends we see universities faced with managing values and practices that appearincreasingly at odds with each other. For example many governments propel them towards commercialisation in search ofadequate funding while at the same time maintaining expectations of community service and responsiveness. This invokesa range of potential responses from alignment with formal pressures, to partial alignment and partial decoupling strategiesas universities try to meet conflicting expectations.

4. Institutionalised neoliberalism

The transforming educational environment has arguably been produced by a neoliberal philosophy emanating from theUS and UK, that has permeated many developed countries and effectively institutionalised a neoliberal commercialisedagenda in higher education. According to Harvey (2005) neoliberalism embraces a political economy theory that humanityis best served by promoting individual entrepreneurship in an institutional setting that privileges private property rights,
free markets and free trade. In this scenario, the state takes on the role of maintaining the institutional setting that facilitatesthe operation of markets, free trade and private property accumulation, and creating desired markets where none currentlyexist. Outside this facilitation role, neoliberal philosophy requires government to minimise its involvement and interventionin the operation of free markets. Each individual is said to be responsible and accountable for their own actions and well

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eing, from education, to health, to welfare. This philosophy was initially advocated by a group of academic economists,hilosophers and historians, particularly influenced by the writings of Austrian political philosopher Friedrich von Hayek.hey opposed what they saw as the interventionist policies of John Maynard Keynes as well as Marxian centralised statelanning approaches. In their view, government decisions could not compete with the accuracy and rectitude of free marketignals. Neoliberalism traces particular emergence in developed country governments to the 1970s where many began tombrace the philosophy of deregulation, privatisation and withdrawal of government from large scale direct provision ofervices. The turn to neoliberalism was most profoundly evident in the UK Thatcher government and US Reagan governmentra of the 1980s. Elected to govern the UK in 1979, Thatcher aimed to remedy stagflation by abandoning Keynesianism anddopting neoliberal monetarist solutions. She challenged trade unions, cut back the welfare state, privatised public sectorrganisations, reduced taxes, and encouraged entrepreneurial ventures. On election to US government in 1980, Reagan alsooved towards tax cuts, deregulation, budget cuts, opposition to trade unions, and advocacy of small government (Harvey,

005). The dramatic changes in size and scope of government, and its commercialised service delivery that such governmentss Thatcher and Reagan installed have persisted to this day, as successive governments of all political persuasions foundhe previous institutionalised changes difficult to deconstruct and retained elements apparently attractive to middle classoters (Hacker, 2006, 2008; Harvey, 2005; Ravenscroft and Williams, 2009).

The underpinning philosophy that has driven the neoliberal movement has reflected values that include social beliefs inelf discipline (with punishment for lapses), self-reliance and the accompanying pursuit of self-interest. These are held asoral values rather than means-ends or cost-benefit rationalities. From this perspective, everyone has the opportunity to

limb the ladder of success, and failure to do so is considered primarily to be the individual’s own failing to take up availablepportunities. Reducing size of government and taxes therefore rewards those who have taken the opportunity to climb theadder of economic success. Thus the individual has the opportunity and responsibility to make correct choices and workard (Hacker, 2006, 2008; Lakoff, 1996). From a governmental perspective, these neoliberal values remove the former belief

n the government controlled safety net in health, education and welfare, and require citizens to become more self-sufficient.nstead they are required to take personal responsibility for managing their lives. Thus freedom and personal responsibilityo hand in hand, economic risk becoming an individual rather than shared responsibility. This personal responsibility crusades what Thatcher and Reagan started politically and economically in the 1980s, and which despite changes in governmentsince, has persisted even today (Hacker, 2006, 2008).

This neoliberal movement has set the foundations for governments propelling higher education institutions towards aommodified commercialised redefinition of their identities and roles. Harvey (2005) points to the neoliberal commodifica-ion, corporatisation, and privatisation of many public assets, financial system deregulation and accompanying speculativeealth redistribution, and the commodification and marketisation of processes, activities, services and relationships. Forigher education, the implications have been profound and far reaching. From the particular ‘morality’ based value systemhat underpins the neoliberal philosophy, education and scholarship have central concerns to promote and reinforce moralnd academic rules for behaviour, rigour and discipline, competition as a key to moral character, and incentives for suc-ess (Lakoff, 1996). Thatcher embodied this at the macro-level by setting out to privatise publicly owned organisations tonhance government revenues and decrease future debts from loss making public sector organisations. Through extendinghe neoliberal ideal of personal responsibility to public sector organisations such as universities, she enforced a culture ofntrepreneurialism, proliferated surveillance mechanisms, increased financial accountability requirements and set produc-ivity targets (Harvey, 2005). Again reflecting the personal responsibility credo, the US and the UK, governments expandedtudent loans schemes to fund students’ self financing of their tuition fees, leaving the majority of graduates with consider-ble debts to be repaid in their early working years (Hacker, 2006, 2008). The notion of user pays that has been increasinglyntroduced via student fees levied by both public and private universities, further meets the neoliberal ideal of wrestingontrol over university programs and teaching/research agendas into the greater influence of the upper and middle classesho can afford to pay for tuition and thereby bring pressure to bear for programs that conform to their own moral andolitical views (Lakoff, 1996). Neoliberal educational values persist in government approaches to higher education fundingnd management even today. The US has witnessed major increases in student tuition fees and reduced government fundingupport for higher education students. Responsibility for higher education funding has shifted away from government andowards students, their families and universities themselves (Orkodashvili, 2007). In the UK, policy agendas have includedncreasing university student tuition fees, university funding related to detailed teaching and research KPIs and measurableutputs, and assessment of university economic deliverables (Leisyte et al., 2006). Higher education has been restructuredith the aim of becoming market responsive, competitive, and efficient and to increasingly meet its personal responsibili-

ies by self-generating revenue and drawing less upon the public purse (Orkodashvili, 2007). Thus the neoliberal agenda hasecome institutionalised and entrenched in public policy and in higher education policy in particular. How has this playedut at the t level? It is to this question that the discussion now turns.

. Government: the remote controller

So has government produced a clever sleight-of-hand? That is, has it appeared to retreat from direct control over higherducation while in fact exercising a much more interventionist style of control through its grant and subsidy funding, andhrough its accountability rules and reporting requirements? The evidence for reducing government financial support forigher education is considerable and has been trending downwards for at least 15–20 years. For example, economic recession


Table 1Australian higher education student enrolments.

Year Enrolled student numbers

1955 30,0001970 100,0001987 393,7341998 671,8532005 957,176

Table 2Australian government funding of higher education.

Year Proportion of higher education funding from commonwealth government

1987 85%1997 54%2003 41%

and the Republican government’s dominance in the USA has seen a pronounced social philosophy of taxation reduction andsmall-government that has resulted in diminished public funding of universities. US federal government has progressivelyreduced research funding, and state legislatures have significantly reduced percentages of state revenues allocated to highereducation (Berman, 1998; Burke and Minassians, 2002; Press and Washburn, 2000). Such reductions have occurred in aperiod of significant student enrolment growth (Alexander, 2000).

The stark picture of reduced government funding underpinning historically rising student enrolment numbers is echoedelsewhere. For example as early as 1997, reports from the UK pointed to a 40% decrease in government funding per studentsince 1976. Student funding as a percentage of national GDP per capita declines have also been reported in Austria, Denmark,France, Germany, Belgium, Norway, Sweden and Switzerland (Alexander, 2000). A similar picture emerges in Australia wheregovernment has focussed upon economic growth and wealth creation, subjecting corporations and individuals to reducedrates of income taxation (Boyce, 2002), while at the same time driving up student enrolments in higher education institutions.For example, a Federal Australian government senate inquiry found that in the 1990s, student numbers in the Australianuniversity system had increased by 70% while academic staff numbers had remained unchanged and teaching loads haddoubled (Parker, 2002). As shown in Table 1, a period of exponential growth occurred between 1955 and 1970, when thetotal number of Australian university students trebled from 30,000 to 100,000. Indeed between 1987 and 1998, the number ofstudents enrolled in publicly funded Australian universities grew from 393,734 to 671,853. Indeed by 2005, the total numberof students enrolled in Australian higher education institutions amounted to 957,176, an increase of 51% since 1996. In thetwo decades since 1977-8, we witnessed a reduction in government spending on higher education of 4.6% in the face of adoubling of total student load. Table 2 reveals that between 1987 and 1997, the proportion of total higher education fundingsupplied by the commonwealth government fell from 85% to 54%, and by 2003 had fallen to 41%. The trend continues. Since1995 there has been a one third reduction in Australian government expenditure on higher education from 1.2% of GDP to0.8% of GDP. Indeed, direct grants to universities by the Commonwealth Government of Australia, have fallen even further:from 0.91% of GDP in 1996 to 0.6% programmed for 2008. Compared to several decades earlier where universities were 90%funded from the public purse, by 1999, universities derived less than 50% of their funding from commonwealth governmenttaxation revenues, and by 2002, they derived only 40% from this source (ABS, 2005, 2007; AVCC, 2005a, 2005b; DEST,2007; Encel, 2007; Marginson, 2002; Marginson and Considine, 2000; NTEU, 2007) The Vice Chancellor of the University ofMelbourne, Professor Davis (2006) has reported that government funding per student in Australian universities has fallen totwo thirds the funding provided in 1976, with the result that by the year 2004, the Australian university system had suffereda reduction in funding of approximately $2.5 billion per year.

In the 1999–2000 year, UK universities were 64% publicly funded and 36% privately funded. In the same year, US uni-versities overall were 46% publicly funded and 54% privately funded. Furthermore in the period 2001–2004, UK public
expenditure on higher education as a percentage of GDP per capita fell to 27%, while the same ratio for the USA fell to 27%(Orkodashvili, 2007). This comparison is summarised in Table 3. At the same time as withdrawing funding from universities,governments in many developed countries have repositioned universities as a tool of economic growth and national pro-ductivity enhancement, requiring them to respond to national economic and social goals (Adams, 1998; Alexander, 2000;
Table 3UK–US tertiary education funding patterns (Orkodashvili, 2007).

UK USA

1999–2000Public funding (%) 64% 46%Private funding (%) 36% 54%

2001–2004Public higher education expenditure (%GDP/capita) 27% 27%

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azelkorn, 2005; Miller, 1995; Sanyal, 1995; Slaughter and Leslie, 1997). For example, the Australian Government (DEST,007) Report on Higher Education listed as a key achievements, that international education services delivered $A10 billion

nto the Australian economy in 2005-6 and that “The international education industry is Australia’s second largest servicexport industry and fourth largest export industry behind coal, tourism and iron ore.” A clear set of neo-liberal core valuesave underpinned governments’ utilitarian approach to higher education as a pathway to an educated, employable work-

orce suited to the global knowledge economy. Higher education becomes market driven in order to meet government andommunity demands for lower cost, higher output performance that is increasingly characterised by the mantras of effi-iency and effectiveness. The philosophy of mass education for workforce upskilling and employability has also spawnedssociated values of ‘flexible’ program delivery, wider student program access, and more. Higher education is now directlyinked to and reflecting business and its values, as a part of the overarching economic rationale now underpinning tertiaryducation (Adams, 1998; Alexander, 2000; Berman, 1998; Marginson and Considine, 2000).

Thus governments in developed countries spanned in this study have arguably imposed upon universities a set of valueshat include a greater degree of financial self-sufficiency, the delivery of export earnings, mass education for employment,nd response to contemporary community values and concerns. Thus universities face accommodating their values andractices to at times multiple competing logics by whatever means they can muster.

Returning to the earlier question of whether government has played a clever sleight-of-hand, the evidence availablenternationally would clearly answer in the affirmative. Government has simultaneously engaged in centralisation andecentralisation of higher education strategies. In the name of market efficiency and responsiveness, universities have beenequired to generate and accommodate larger student numbers, increasingly engage in fee-for-service education delivery,nd produce research of short term application to national economic and competitive advantage (Davies and Guppy, 1997;iller, 1995). How has this been done? Government has centralised and tightened its control over the universities’ outcomes

nd products while at the same time deregulating its degree of control over university internal operational, management andudgetary processes (Vidovich and Currie, 1998a, 1998b). The control over university outcomes and products has predomi-antly been exercised through making government funding (even though a diminishing proportion of university revenues)ontingent on their achievement of market based KPI’s that measure such variables as organisational productivity, customeratisfaction, and graduate employment (Alexander, 2000; Coaldrake and Steadman, 1998).

From the above analysis it becomes apparent that governments have both reflected and driven a substantial change inocial norms and expectations concerning the role and functions of universities and the value of higher education. Fromn NIS perspective, to a considerable extent this has reflected the almost universal trend towards commercialisation andrivatisation of the public sector. The focal values attached to higher education have become:

knowledge as a driver of national economic development;universities services and products as key national export commodities;the primacy of knowledge for industry application;employable graduate output;operational value for money, efficiency, and effectiveness;fee-for-service and market competitive deliverables.

At one level, universities have exhibited coercive isomorphic behaviours as they respond to government’s directives, itsontingent funding of universities, government prescribed KPIs and associated accountability reporting requirements. At aecond level, universities have also exhibited mimetic isomorphic behaviours in their replication of each others’ missions,bjectives, and strategies as they now strive to compete in the national and international educational marketplace. Despiteheir best efforts, they show signs of increasing convergence in organisational and program structures, research and teachingrocesses, image, and marketing. Government’s move into the remote controller role has simultaneously triggered univer-ity redefinition and homogenisation through both direct coercive measures and indirect induction of market competitiveehaviours. Therefore despite multiple external influences and variant competing agendas form governments and commu-ities, universities show signs of adopting similar accommodating behaviours and tending towards convergence rather thaniversity.

. The hybrid corporation

Higher education researchers and commentators generally agree that universities have corporatised and commercialised.n being required by governments to compete in the marketplace for customers, funding, sponsors and the like, they haveenerally adopted the business model, redefining themselves as retailers of products and services. They have largely movedn from being vehicles for the pursuit of knowledge and being venues for independent thought and critique, to becomingarge commercial enterprises for satisfying demands for educational and applied research services (Abeles, 2001; Liu andubinsky, 2000; Roberts, 1999). Marginson and Considine (2000) typify the corporate model adopted by a public sector
niversity as the Enterprise University, in that the university attempts to graft a business culture onto a public sectornd public interest oriented culture. The university culture has nonetheless definitively moved towards a market drivennterprise culture, largely reflecting the new managerialism of the NPM model that has increasingly pervaded the publicector (Ackroyd and Ackroyd, 1999; Lucas, 2006). This trend reflects the NIS recognition of institutions simultaneously


aligning with and decoupling from multiple external pressures and influences in order to cope with and survive the multipleunderlying logics that motivate them.

Structurally, universities have increasingly moved towards redefining university vice-chancellors or principals as chiefexecutive officers (CEOs), with governing councils being downsized and composed more in the nature of corporate boards,with a pre-dominant membership drawn from industry and commerce. In Australian universities, for example, universitycouncil sizes range from a high of 35 to a low of 13 with 31 university councils having between 18 and 22 members. Theaverage proportion who are elected is 35%, with 65% being appointed ex officio. These boards generally bring marketisedvalues into the institution. For example the profile of Australian university councils overall includes 32% of members witha business and profession background, 10% drawn from the community at large, 7% public servants, 4% politicians and 6%executive staff (AVCC, 2003). Decision-making power has become concentrated in the hands of the CEO and his or her keydeputies in the senior management structure (Ackroyd and Ackroyd, 1999; Roberts, 1999; Winter and Sarros, 2001). Theuniversity organisations they lead, increasingly exhibit management structures and control mechanisms that reflect themanagerialism of the private sector corporation (Lapsley and Miller, 2004). Currie and Vidovich (1998) argue that the trendto senior management decision-making prerogatives and top-down university control smacks of a fundamentalist belief inthe need for ongoing organisational change, and the need for professional top management’s direction if the university is tocompete effectively in and rapidly respond to the marketplace. In this respect, from an NIS perspective university governancehas formally adapted to varying degrees, to what it sees to be the desirable and assumed business model of organisationalgovernance. This formal lean structuring of top level governance has been augmented by a less formal centralisation ofpower and control in the hands of the CEO and their top management team.

Admittedly these changes across recent decades have varied in degree between different university categories, for exam-ple the UK civic universities and Australian sandstone universities versus the former British polytechnics and AustralianColleges of Advanced Education (CAEs), versus the more recently established universities in both of those countries. Whilethe older universities were accustomed to a more guild based collegial tradition of decision-making, the newer universitiessoon adopted more managerial modes of decision-making. Thus new universities moved more rapidly to a CEO role for theVice Chancellor equipped with more directive powers, although arguably the older more traditional universities have alsobeen exhibiting this trend. Thus with the abolition of the binary divide and the unification of university systems within eachof the UK and Australian higher education sectors, governance structures and centralised management have increasinglyconverged (Leisyte et al., 2006).

University objectives now reflect a private sector corporate philosophy. They follow a credo of profit and prestige maximi-sation. Image and brand have become the dominant ethos in search of increasing revenues and profits (Bok, 2003; Francis andHampton, 1999; Marginson and Considine, 2000; Waugh, 1998). The role of serving the public interest is increasingly beingreplaced by service to the needs of private sector industry and commerce (Washburn, 2005). Indeed the missions that uni-versities formally publish are increasingly convergent and homogeneised. This arguably reflects their senior managements’obsession with published esteem rankings that include government teaching and learning quality audits, business schooland MBA program rankings published by press and other media, research fund success rankings and faculty publicationrankings associated with the increasing array of journal esteem rankings being applied across disciplines. Such forces driveuniversity leaders towards maximisation of rankings as part of their brand enhancement strategies. The associated problembecomes one of universities all seeking the same rankings, thereby tending towards conservative strategies employed at alllevels (organisation-wide to individual). Rigour and conventionally accepted teaching and research subjects and methodsbecome the currency, at the cost of imagination, innovation and critique (Gray et al., 2002; Marginson and Considine, 2000;Northcott and Linacre, 2010; Parker, 2002; Reinstein and Calderon, 2006).

Academic language has increasingly been replaced with corporate and business language. Professors have been rede-fined as middle managers, courses and programs as saleable products, and students as customers. ‘Brand’, ‘target markets’,and ‘pricing’ have become the currency of university discourse (Francis and Hampton, 1999; Taylor et al., 1998; Washburn,2005). Corporate strategies within the university sector have embraced corporate sponsorship of university chairs, schools,and buildings and facilities, corporate advertising and promotion on campus, university investments in start-up enterprises,venture firms, technology parks, commercial companies and commercialisation of research. The scale and scope of thesecorporate strategies is increasing to the extent that in many universities they now comprise the majority of total revenuestreams and are generated globally (Bok, 2003; Boyce, 2002; Slaughter and Leslie, 1997; Washburn, 2005). While relation-ships with private sector industry and commerce may have been more assiduously courted by former polytechnics, CAEsand technology universities in countries such as the UK and Australia, nonetheless, the traditional universities have quicklyplayed ‘catch up’ and new universities have enhanced their focus on such relationship building. Hence while universitiesmay have attempted to maintain at least visible apparent pursuit of competing values (namely commercialisation and com-munity responsiveness), both formally and informally, commercial values and objectives have arguably taken their seatat the head of the boardroom table. Thus while universities may attempt to accommodate and institutionalise multiplegovernment and community agendas, the financial resourcing agenda looms large on the horizon.

The corporatisation of universities carries both advantages and disadvantages. On the plus side of the ledger for example
is the trend towards enrolling a higher proportion of the total population, for example in some countries approaching 50%of the secondary school leaving age population. Internationalisation of teaching programs and student bodies, better linkswith industry and commerce, more efficient internal operations, better access to research sites, more workplace relevantteaching programs, improved graduate employment rates, access to better facilities and equipment, and more flexibility

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n recruiting high quality staff are some of the claims made. On the other hand, critics point to the more restricted andxpensive access to education for aspiring students, the abandonment of societal critique in favour of vocational teachingnd corporate sponsored research, as well as reduction in standards and quality of both students recruited and of programsaught through low cost–high revenue strategies (Currie, 2004; Slaughter and Leslie, 1997).

Of course in more recent times, the global financial crisis has impacted on university endowment funds and investments,dding to their levels of resourcing uncertainty. It is estimated that UK universities have lost £250m from their endowmentunds at a time when government funding is declining and wage costs are rising. The 20 Russell group research universitiesave lost more than £190m in the value of their endowment funds (Lipsett and Curtis, 2008). The corporate universitypproach to managing financial stringencies is all too evident in the international trend towards downsizing the scope ofniversity degree programs and associated academic units. Not only are university managements prepared to cut overallxpenditures and staffing, but also they increasingly trigger audits of academic departments, programs and course enrol-ents. As a result, they invariably employ vertical cuts down through the organisation, downsizing or closing altogether,

ntire academic programs and units deemed to be uneconomic. This has been particularly evident in the less vocationalreas such as the arts, including history, philosophy, languages, literature, as well as in parts of the sciences. Academicreedom and creativity is arguably affected. Overall, university management adopts the corporate tradition of streamliningnd reducing numbers of academic units, numbers of programs, and eliminates small enrolment degrees and courses. Thisattern is evident across universities in countries such as USA, Canada, UK, Australia and New Zealand (Brint et al., 2005;unnane, 2010; Healy, 2008a, 2008b; Sassower, 2000; Worton, 2010).

As Bok (2003) argues, a university is a more uncertain and ambiguous entity than a private sector company. It operates inparticularly hybrid environment, with a wide array of stakeholders, public and private interest motives in constant tension.

t also exhibits structures and processes that often mix public and private sector characteristics and philosophies. Finally, astill being ostensibly a public institution, it is invariably subject to intense scrutiny in the public domain.

We have in recent decades witnessed a fundamental redefinition of the university into what now is at the very min-mum some form of hybrid public–private sector corporation. Through an NIS lens it arguably reflects the marketisationf the higher education sector and the universities’ attempts to adapt to that new environment, mimicking private sectororporate models and mimicking each other in adopting those models. The coercive and mimetic adoption process becomeseinforced by a form of normative isomorphism in the shape of the values and strategies introduced by the professionalanagement class imported into the top decision-making and control levels of university structures. Thus we find multiple

nd mutually reinforcing forms of isomorphism operating simultaneously. The accompanying formal private sector corpo-ate structures and systems are employed by universities to project themselves as efficient and effective organisations thateet the ‘standards’ of the corporate world and thereby merit funding and support from government, industry, customers

nd sponsors alike. As NIS argues, such strategies also aim to reduce the uncertainty and ambiguity characteristic of theniversity environment and to enlist cohesive and predictable organisational behaviour and outcomes.

. Governing “scientifically”

Moves towards contemporary corporate university governance structures arguably began as far back as the 1980s,nd while there were varying degrees of disquiet amongst university senior management, they generally embraced thesehanges, arguably seeking to maximise their own institution’s positioning in relation to government funding and externalevenue generation (Washburn, 2005). Since then, power at the top of the university hierarchy has increased dramatically.s the hierarchical management structure became embedded in the university, ‘professional’ managers were appointed

o senior positions in the bureaucracy with accompanying increases in their decision-making power. In part, their powermanated from their roles as boundary spanners, liaising with and interpreting the demands of external stakeholders suchs government and other key resource providers. Responding to these pressures, the professional managers have moved toentralise decision-making authority and control over university finances as a means of adapting to the changing externalniversity environment (Marginson and Considine, 2000; Neumann and Guthrie, 2002; Washburn, 2005).

Along with the rise in centralised top management power within the university, has come an accompanying decline inollegial modes of governance, with decision-making power and influence being progressively removed from disciplines,epartments and schools. As a result, tensions emerge between the two decision-making approaches, and between universityanagement and academic staff. Indeed as the philosophy of new managerialism permeates into faculties and schools,

he top-down authoritarian style of decision-making becomes more endemic and shows signs of undermining previousrerogatives of academics to make strategic decisions regarding degrees to be offered, their content, modes of educationalelivery and more (Connell, 2004; Currie, 2004; Neumann and Guthrie, 2002). Some critics have gone as far as to suggesthat academic faculty may themselves become redefined as customers or marginal stakeholders, rather than remaining aart of the internal decision-making group (Waugh, 1998). Ackroyd and Ackroyd (1999) for example cite the philosophiesnd structures of the pre and post 1992 universities in the UK, the former having a collegial approach to governance and theatter a corporate approach in which members of staff are treated as employees rather than as members of the university
Ackroyd and Ackroyd, 1999).
In the new corporate executive management system, CEO’s imitate their private sector corporate counterparts with highevel remuneration packages vastly outpacing professoriate and other middle manager levels, and often contingent on uni-ersity student growth and financial performance targets (Fitzgerald, 2008; Soley, 1995; Waugh, 1998). Deans are redefined


as middle managers answerable to the senior executive, rather than as discipline leaders representing their disciplinaryacademic constituency. Major strategic, operational and financial decision-making power has become vested in the CEOand senior executive managers who fill key strategic portfolio roles such as education, international programs, research,and industry links. The generally small senior management circle may or may not include the faculty deans. It wields majorcentralised power within the university. Power is wielded not only by directives but also by plans, targets and related incen-tives (Marginson and Considine, 2000; Parker, 2002). So the tools of control wielded over universities by governments arecascaded down within the organisation to be wielded in precisely the same way by the CEO and executive management.

The emerging contemporary approach to university governance is strongly resonant of scientific management, popu-larised in the USA, Europe and elsewhere in the latter part of the 19th century and the early years of the 20th century. Thisargument has been made by a number of researchers in the published higher education administration research literature.Berman (1998) for example compares today’s search for making universities more efficient with the North American attemptsto translate the scientific management practices of early 20th century industry into Taylorising the American educationalsystem. The Taylorist commitment to top-down management planning and decision-making is arguably reflected in today’scentralised style of university corporate governance in which an almost fundamentalist faith in the efficacy and authorityof top management’s right to direct and govern prevails (Vidovich and Currie, 1998a, 1998b). What has been typified as‘new managerialism’ is arguably not new at all, but a resurgence of scientific management (Lucas, 2006). It is exemplified byincreasing references within university discourse to total quality management, international best practice, re-engineering,and the general copying of these scientific management concepts and languages by universities from corporations and eachother, across national boundaries (Currie, 2004; Vidovich and Currie, 1998a, 1998b).

Indeed discernable traces of scientific management in contemporary university governance and operations reflects itsoften subtle persistence in business organisations across the 20th century and into contemporary practices in both theprivate and public sectors. For example Boje and Winsor (1993) analyse the contemporary phenomenon of Total QualityManagement (TQM) as a reflection of and repackaging Taylorist principles. Parker and Ritson (2005a,b) have also arguedthe persistence of many of Henri Fayol’s ideas on organisational structure and management in management literature andpractice across the years, despite his stereotyping and overshadowing by other writers and competing gurus. In greaterdetail, Parker and Lewis (1995) have also argued the persistence of scientific and classical management across the 20thcentury in both business and government within ‘western’ developed economies. They cite the underlying politics of eco-nomic rationalism and the emergence across private and public sector organisations of downsizing and outsourcing, plustechniques such as TQM, International Best Practice, Business Re-Engineering and Continuous Improvement. They see thescientific/classical management approach to control particularly reflected in contemporary business and government finan-cial management, budgeting, costing, and management by exception. In addition, they argue for its ongoing reflection inpublic and private sector organisations’ contemporary focus on efficiency and profits as central organisational concerns.Across the sectors, they see the scientific management concerns with implementing formal management structures andprocesses, detailing formalised strategic objectives and plans, focussing on efficiency and effectiveness, and building inter-nal and external accountability systems as maintaining continuity across the decades into today’s public and private sectormanagement practices. Thus scientific management at least deserves recognition as an underlying influence upon developedcountry higher education, and particularly university, governance and operational features to the present day.

Further attestations to the continuing influence of scientific management in contemporary organisational thinking andpractice are readily available. Mohanty (1993) advocated the revisiting of scientific management in organisational consultingand management for resource efficiency, planning output norms, managing staffing levels and operating incentive schemes.Freeman’s (1996) study of scientific management over 100 years found that many scientific management features persist inmanagement practice today. These he found to include time and motion study, standardised personnel selection procedures,administrative and manufacturing process manuals, statistical process control, as well as incentives and bonus remunerationsystems. Jeacle’s study of the application of scientific management in early 20th century department stores revealed theirinfluence over credit control, inventory valuation, and overhead expense allocation. They emerge as predecessors of themanagement of global retail organisations and an example of a fashion similar to the balanced scorecard taking hold ofmanagement thinking and practice. Thus she argues that much contemporary retail practice, particularly in the areas ofbudgeting and inventory management, continues to reflect the scientific management era.

Just as NIS theory development has recognised that organisational change and institutionalisation can follow a complexnon-linear path, so universities have exhibited governance structures and processes that to varying degrees have undergonechanges from earlier decades and which still encompass differing traditions and tensions in approaches and values acrosstime and across organisational levels. What is referred to as ‘new’ and ‘corporate’, at least to some extent reflects approachesand values characteristic particularly of North American industry a century ago. The NIS lens offers further insights here. Themove towards centralised, top-down managerial control appears to represent what university management considers tobe an imitation of the private sector corporate governance model. Whether such mimetic isomorphism accurately mimicsprivate sector models is contestable and open to further investigation. As senior management has wrested power fromfaculties and schools, they have initially moved decision-making into informal groupings of senior management that have
subsequently become formalised and institutionalised as formal executive decision-makers. Deans who may have initiallyresisted the loss of their disciplinary representation, show signs of being gradually absorbed into the executive powerstructure and complying with their redefined roles as managerial agents of the university’s senior executive. New corporatevalues become gradually internalised further and further down the chain of command as top management searches for


ways to induce compliant and cohesive behaviour from its university workforce. Along with other environmental forces,the scientific management approach has produced a fundamental redefinition of the identity and roles of academics withinuniversities, now being increasingly formalised and institutionalised.

8. Academics redefined

There appears to be a general consensus amongst surveys of academics that much of the decision-making power withinuniversities has indeed passed from formerly influential collegiate academic committees and academic units to univer-sity managers, thereby leading to predominantly centralised management driven research and teaching strategies. Thishas been the case for some time in the newer universities and has increasingly been the trend in older more traditional(and formerly collegially governed) universities. Consistent with the scientific management tradition, top-down executivemanagement has become the dominant decision-making and leadership mode. Often this has progressed by stealth andincreasingly interventionist government control and accountability requirements. University managements have tended todevelop managerialist decision-making systems that have intentionally or unintentionally gradually undermined the col-legial consultative model, academics’ autonomy and authority within the university governance structure being the majorcasualty. Academics themselves have tended towards one of two general reactions: joining the managerialist system andfinding new managerial roles within the structure, or withdrawing to varying degrees from direct participation in uni-versity decision-making, seeking to insulate themselves as far as possible from its demands (Lucas, 2006; Marginson andConsidine, 2000; Vidovich and Currie, 1998a, 1998b; Winter and Sarros, 2001). Here again from an NIS perspective, we seeco-existing academic strategies of alignment with and decoupling from new managerialist structures and processes withinhigher education institutions.

Extending from the managerial-academic divide, academics are also diverging in the roles they adopt within the cor-poratised, commercialised university. It is increasingly argued that they have largely lost their formerly unique roles asindependent, professional, expert educators and research scholars operating in collegial association and co-decision-makingwith their university of which they were members. Instead, they are increasingly being redefined as teaching, research andadministrative employees of the university, subject to its strategic objectives and direction, and driven and evaluated bycorporate KPIs that drill down from university, to faculty, to school, to individual levels. In their performance targetingand measurement environment, academics variously attempt to badge themselves as teaching experts, research man-agers, degree program development and marketing leaders, or commercial research program development and resourcingentrepreneurs. The academic role definition is therefore more clearly located at the coalface level of university operations,with academics seeking to maximise their KPI results for their own short to medium term benefit and career progression(Soley, 1995; Sutz, 1997; Tysome, 2006; Ylijoki, 2003). From an NIS perspective, this amounts to the changing economic ratio-nalist environment that drives university strategies, drilling down to the very roles of academics themselves and permeatingtheir own academic values and self-constructed identities to increasingly align with economic and financial imperatives.

Along with academic role definition has come a generally dramatic increase in workload levels afflicting academics.They now work longer hours to cope with the increasingly mass or large batch production-line teaching, assessment andadministration associated with increasing student numbers and class sizes. Increasing student loads are evident in forexample a 150% increase in UK higher education student/staff ratio from a 1975–1976 average of 9/1 to a 2003–2004 averageof 21/1. This dramatic rise occurred mainly across the 1975–2000 period, and thereafter settled at a much higher averagelevel than in previous decades. Table 4 shows the student to teaching staff ratios for 2003 in France, Germany, Japan, UKand USA (AUT, 2005). Academics also report a significantly increased percentage of working time committed to satisfyinguniversity and government administrative demands for more detailed and invasive control and reporting systems. Suchtrends have been accentuated by devolution of increasing amounts of routine operational and compliance administration toacademic schools and departments, with a consequent expansion of academic’s working hours, an intensification of the paceof their work and increased work-related stress (Currie, 2004; Lipsett and Tysome, 2006; Miller, 1995; Winter and Sarros,2001; Ylijoki, 2003). Such has been the pressure on academic workloads, that universities have opted for an increasinglycasualised academic workforce, relying more and more upon fixed term contract academics, casual lecturers, casual tutorsand part-time teaching assistants for delivering teaching programs to the (in many cases) mushrooming number of degreeprograms and students (Churchman, 2002; Roberts, 1999; Washburn, 2005). For example in the UK, universities range inpermanent staff as a percentage of total staffing from a high of 98% to a low of 22%. Amongst leading universities, thepercentage of permanent staff can for example be found to be 30% at University of Cambridge, 34% at Oxford University, 33%at London School of Economics, 43% at Kings College London University and 56% at the University of Glasgow (Kim, 2008).

Table 4OECD ratio of students to teaching staff in tertiary education institutions (AUT, 2005).

Country Student:staff ratio 2003

France 17.6:1Germany 12.5:1Japan 11.0:1UK 18.2:1USA 15.2:1


Academics’ mode of working has also been subject to change resulting from their increased workloads and reduceddecision-making autonomy. Teaching delivery and content has tended towards being more packaged, instrumental, appliedso as to fit the university’s vocational graduate employment preparation focus. Their research approaches have evidenced amore short term, application and funding generation orientation. Their mode of daily operation has also reflected universityimposed workload and performance measurement pressures such that academics operate in more isolationist mode, havingless time available for participation in research forums and seminars, informal collegial discussions, mentoring of juniorcolleagues, and face-to-face communication with colleagues and students. Work predominantly takes place in the form ofclassroom teaching, formal administrative meetings, working in the individual’s office, and email even beginning to supplantthe telephone (Churchman, 2002; Miller, 1995; Vidovich and Currie, 1998a, 1998b). Again, these trends reflect an increasingalignment between academics’ roles and patterns of working and the education massification trends inflicted by changingeducational agendas and rationalities at government, societal and university institutional levels.

Consistent with the centralised managerial decision-making structure and the university’s corporatisation and commer-cialisation has come a reduction in academics’ autonomy and freedom of speech. Consciously or unconsciously, their abilityto express expert opinions or offer critiques in the public domain, is limited by either their university’s management or bythemselves, for fear of offending key stakeholders and present or potential funding sources, or by fear of impact on theirown performance evaluation, job contracts, tenure and career prospects within the university. They are also limited by theuniversity’s commercial agreements and partnerships with external organisations, as well as the university’s confidentialobjectives and strategies (Parker, 2002; Roberts, 1999; Washburn, 2005). In the UK and Australia for example, it might beargued that the reduction in autonomy has been less in new universities than in older traditional universities. Nonethelesseven in a newer university with a strong applied research, professional teaching, technology and community focus, thelimitations upon so-called ‘academic freedom’ are nonetheless evident. As Leisyte et al. (2006, p. 23) argue, between the oldand new post-1992 UK universities, the ‘opposition between the two is not as clear-cut as it seems’. Indeed they contendthat ‘Both Old and New universities have common features and are influenced by similar constraints’.

Observably then, academics are increasingly experiencing both role and value conflict between the tradition of individualscholarly and applied inquiry and the emerging corporate pursuit of strategic personal KPIs. Their former values of liberalscholarly inquiry and critique, long term contribution to societal knowledge and culture, and service to the public interestare now challenged by the requirement to serve a dominant and expansionist vocational and economic development focusevident across the university sector, regardless of origin. A fundamental shift in core values therefore underpins the academicrole redefinition discussed above (Adams, 1998; Currie, 2004; Tysome, 2006; Winter and Sarros, 2001; Ylijoki, 2003). In thisway, the institutional accommodation of changing contexts and influences embraces associated value changes, importingthem from changing governmental and societal expectations right through to academics’ own core values.

The overall outcomes of university corporatisation and commercialisation become more transparent when viewedthrough the NIS lens. Universities mimetically respond to and comply with changing societal demands by adapting andindeed radically transforming their educational products to meet student and community demands for vocationally oriented,employment generating programs and courses. Examples of such behaviour are particularly evident in the philosophy ofcustomer service and orientation mimetically imported from the private sector and symbolically reflected in private sectorlanguage that reinterprets the student as customer. So reconfigured, the student customer, by virtue of their potential threatof fee withdrawal, becomes a powerful coercive force that brings direct and indirect pressure to bear upon university prod-ucts, services, delivery modes, entry standards, performance expectations and more. Seeking to attract and retain revenuegenerating stakeholder support, universities transform the balance of their educational offerings and research projects, grad-ually increasing the balance of applied, careerist projects and programs. While there remains evident decoupling between theprojected vocational, applied image of university offerings and continuing basic, long term scientific and cultural educationand research, in many institutions the latter is in decline.

From a research perspective, traditional curiosity-driven, fundamental and critical research sits in increasingly uncom-fortable juxtaposition with the newer industry oriented applied research agenda. Both decoupling from and compliancewith the new government and business funding driven research ethos is again evident, with funding driven compliancebeing increasingly the order of the day. Increasingly the funded, short term, applied research orientation is being absorbedand internalised by universities and their academics. One consequence is the increasing prioritisation of private interestsover the public interest. Government research ranking metrics are also becoming increasingly powerful coercive forces forabsorption and internalisation as personal KPIs by academics. These subsequently become reified as new core values atthe academic unit and individual levels, continually reinforced by university management control systems that have beenreoriented towards revenue generation and cost minimisation.

The NIS perspective recognises that the institutionalisation process can at times reduce ambiguity and uncertainty whileaiming to increase the cohesiveness of the workforce and its behaviours. In the case of universities, it is a complex process.Their institutionalisation of commercial revenue raising objectives, strategies and control systems may aim to reduce ambi-guity in performance expectations and improve academics’ cohesion, but in reality is fraught with difficulties. Universitysegments that experience low market demand face worsening uncertainty and diminishing expectations about the future
prospects of academic units and their members. High market demand areas on the other hand can perceive ambiguity andmixed signals relating to performance expected of them, being overburdened with mass teaching loads while still beingrequired to produce successful funded research. These experiences have the potential to divide rather than unite staff, withdifferential expectations, motivations and behaviours being exhibited by senior versus junior staff, academic versus man-

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gerial staff, and tenured versus casual staff. Ultimately, while a degree of decoupling between traditional and new academicalues and roles persists, evidence suggests that the former traditional values are being gradually supplanted, with the neworporate, commercial ones becoming formalised and institutionalised.

. The accounting and accountability conduit

This paper’s analysis and critique of university corporatisation and its drivers has repeatedly returned to the role ofccountability as a facilitator of the incessant drives towards commercialisation and corporatisation of university missions,hilosophies and strategies. Accounting and accountability have arguably become ever more prominent conduits for thexercise of governmental and senior university management influence upon the redefinition of university identity and roles.

A primary driver of the increased recourse to accounting measurement has been governmental demands for increasedccountability and value for money. This has manifested itself in two perceptible cultures, a performance evaluation culturend an audit culture. In seeking value for money, governments in developed countries across Europe, UK, North America andustralasia have increasingly sought economies and efficiencies in higher education delivery both through fostering privateducational institutions and by demanding increasingly invasive financial accountability and reporting systems. Institutionalffectiveness and productivity are pursued through proliferation of accounting systems and measures and through themposition of audits of quality, value for money, benchmark comparisons, and the construction of league tables. To this end,uantitative performance indicators abound, linking traditional areas of research and teaching directly to financial resourceroduction and consumption statistics (Alexander, 2000; Craig and Amernic, 2002). Accounting is heavily implicated in thisonstruction of a reconfigured accountability that arguably has shifted focus from broad scope accountability to society andommunity, to one of primary financial accountability to government.

This reconfigured financial accountability focus has taken on both the traditional forms of cost allocation and budgetings well as versions of balanced scorecard and total quality management. These reflect a market based economic reconcep-ualisation of the purpose and focus of higher education, commodifying it for revenue generating production and assessinguccess in terms of financial returns, just as for any other marketable commodity (Lawrence and Sharma, 2002). This haslso spawned a tendency for accounting systems to privilege internal and external compliance reporting as the central per-ormance targeting and reporting agenda, as institutions strive to satisfy resource provider financial accountability demandsPendlbury and Algaber, 1997). Thus internal university decision-makers can find themselves poorly served, while at theame time, external stakeholders suffer a public discourse more restricted to the financial. In the late 1990s for example,sample of 100 US college and university annual reports revealed a predominantly financial reporting emphasis aimed at

hose with commercial relationships with these institutions, while information potentially relevant to stakeholders withnterests in teaching, research and service activities was much less evident (Coy et al., 2001).

Accounting has been heavily complicit in the internal reorientation of university objectives, strategy and focus at allevels, particularly through the financialisation of teaching, research and administrative planning and control (Angluin andcapens, 2000; Coy et al., 2001; Pendlbury and Algaber, 1997). Increasingly top management shows signs of centralising fundsanagement and financial gains while at the same time decentralising administrative tasks and responsibilities downwards

hrough the management hierarchy. Accounting and financial management methods range from top-slicing a significantroportion of all revenue flows for the strategic discretion of top management, charging faculties, schools and units for usagef central facilities such as libraries, IT, finance, marketing, and student services, experimentation with Activity Based CostingABC), service level agreements with subunits, internal transfer prices and competitive tendering for selected functions. Costrivers employed, range from student numbers, to staff numbers, to other ABC drivers. Budgets assume increasingly centralositioning in the planning and strategic decision-making focus at all levels of the institution. Financial expenditure andurplus disposition discretion varies from highly centralised to more decentralised with an observable tendency towardsseudo-decentralisation. Particularly budgeting plays a crucial role in the both the financial and consequently operationaltrategising and implementation for universities. While it is variously perceived as a short term annual financial planning andontrol instrument and as a longer term strategic driver, it inhabits both worlds. It arguably becomes a vehicle and languageor strategy shaping, performance monitoring, funds re-allocations, expansion and contraction decisions and more (Angluinnd Scapens, 2000; Broad et al., 2007; Ezzamel, 1994). These are oftentimes hidden from view but palpably influentialtructures and processes through which accounting weaponry is employed both to redirect university missions and strategiesowards the corporatised commercial agenda while also meeting the financial and economic agendas of government.

The accounting gaze has extended even into the inner world of research management. Willmott (2003) cites the allervasive influence of the British government’s Research Assessment Exercises (RAE) which induced a highly complex andhanging set of rules for research performance assessment and funding for which British universities expended consider-ble resources and gaming strategies in their attempts to win a larger share of national financial research resources. Thisehaviour has been replicated in similar systems in such countries as Australia and New Zealand with their various describedesearch Quality Framework (RQF), Excellence in Research for Australia (ERA), and Performance Based Research Fund (PBRF)Neumann and Guthrie, 2002). Research performance is increasingly been qualified and rated in terms of research funds
on, publication quantum, journal rankings, doctoral students graduated and more. European examples of the increased
uantification of research performance accountability include the Netherlands moving towards a ‘performance’ orientedesearch assessment and funding scheme, Denmark where research funds awarded relate to volume of teaching and exter-al research income (research income thereby becoming a generator of further research income), and the Slovak Republic’s


employment of performance indicators including publications, citations, editorial board memberships, staff qualifications,postgraduate student numbers and more (Guena and Martin, 2003). Such performance based funding approaches have alsobegun to emerge in Germany, Sweden, Austria and Canadian provinces such as Alberta and Ontario (Alexander, 2000).

The insertion of accounting into the accountability equation within universities has arguably been pernicious. It hasfacilitated the penetration of governmental commercialisation agendas deep into the core of university values, roles andidentities. Not only has it translated many philosophies, missions and activities into predominantly financial terms, but it hasundercut both the ability to represent and to report university contributions to knowledge, society and community. Socialand academic norms as well as cultural expectations and practices risk being supplanted by accounting and financial KPIsas bases for valuing higher education and research. Measurable financialised results have increasingly become the order ofthe day, with accounting technologies both uniquely positioned to reinforce and take advantage of this reconstruction ofthe hybrid corporatised university. Again from an NIS perspective accounting facilitates the development of a formalisedimage of rationality and compliance with primary government economic agendas. Through its apparently well organisedfinancial management systematisation and financial reorientation of external report content, it assists senior managementin winning and maintaining key stakeholder support and resourcing. At the same time it maintains the pressure uponinstitutional members to gradually and increasingly formally adopt a financial performance focus into their formal andinformal academic routines.

10. Reflections in the mirror

The transformations in universities identified and analysed in this study, have clearly been profound and far reaching.They are reflected in radically altered university missions, core values, strategies, structures and academic identities. Itis instructive at this point to return to the research questions posed at the outset of this paper. With respect to the firstquestion posed, a number of key factors emerge as driving the apparent radical transformation of university identity andfocus. These include the importation of private sector philosophies into the public sector, particularly through the agency ofNPM. In a globally competitive world, many governments have sought economies and efficiencies in the education sector,redefining and measuring it in economic terms and adding it to their stock of industries being managed for the generation ofeconomic wealth. In response to the second question, government has played a central role in motivating these changes byreducing direct funding levels and forcing universities into the global marketplace, by increasing the numbers of studentsbeing directed into the university instructional system, and by requiring universities to formally respond to and addressgovernment determined national social and economic priorities. On one hand many governments have released a degree ofdirect control over university strategies and operations while at the same time demanding greater accountability and henceeffective control over university performance KPIs and outputs.

What of the corporate characteristics that universities have imported from the private sector? These oftentimes appearin the form of a hybrid corporate appearance, attempting to graft a private sector business culture and language ontoa traditional public sector or public good orientation. University senior managements have been redefined in corporatestructures and terminology, accountability and control mechanisms mirror a top-down corporate framework, objectivesare increasingly oriented towards financial short-term targets, brand and image enhancement and operational strategiesincreasingly echo corporate competitive financial strategies. Such observations prompt a return to the question as to whathistorical origins does this pattern of behaviour appear to reflect? This paper argues that one major explanation lies in anapparent return to scientific management philosophies in vogue in the private sector on both sides of the Atlantic in the late19th and early 20th centuries. This is particularly evident in the Taylorist philosophy of top-down management planningand decision-making, the commitment to quantified performance measurement, and the incessant search for efficiencyimprovements. Finally we return to the question of how these influences and changes appear to be reflected in the identityand role of academics serving within these institutions. A weight of research literature on this subject suggests that for many,the collegial decision-making style has been replaced by executive management responding to government accountabilitypressures and revenue generating targets implicit in their employment contracts. Academic reactions are still awaitingfurther observation and diagnosis, but include compliance, insulation or withdrawal strategies as they try to cope with arole that is increasingly one of the knowledge worker managing increasing workloads, proliferating KPIs and an increasinglyvocational, applied orientation.

Overall then, university structures and processes now more often reflect a hybrid public–private sector corporate profilewith a pronounced commercial orientation. They mirror national government philosophies that increasingly embrace a beliefin smaller government, de-regulation, lower taxation, market based service delivery, and payment by the user. Thrust intoa global educational market by governments aiming to reduce their educational investment expenditures, universities havebeen forced to respond to their redefinition by governments as an employment generating export industry and contributorto national economic growth. Reinforcing such coercive isomorphism has been universities’ mimetic isomorphism of thepublic sector’s commercialisation and privatisation, reconstructing their structures and processes in the image of NPM.In addition, we find the normative isomorphic importation of private sector corporate values and operations through the
arrival of the professional managerial class increasingly employed at the senior levels of university central management.Two associated outcomes have been only barely noticed by researchers and commentators to date. First is the growinghomogenisation of university missions, strategies and profiles that is becoming increasingly evident. The phenomenonreflects the common forces to which universities are responding and adapting in a world marketplace that is increasingly

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ecoming less differentiated, offering a global pool of students, international corporate sponsors and research partners, andacilitating educational delivery systems that transcend national boundaries. Second is the apparent corporate governanceegression to an earlier era of scientific management. It is characterised by collegial governance structures and processeseing replaced by formal authority-based direction and control exercised by the executive level of central management.ithin this context, academics themselves have been redefined and reconstructed as employees and workers. Their role

as been recast from knowledge creators and propagators, liberal inquirers and societal critics into vocational servants ofhe corporate university mission.

In conclusion then, as this paper’s title suggests, universities have indeed become increasingly corporatised, either asvowedly private universities, or as hybrid corporates where private sector corporate philosophies and structures haveeen grafted onto a public sector model. In so transforming, many of them have indeed become redefined. They have beenransformed and reshaped in the market image, reflecting the profound shifts in societal and government philosophiesnd expectations over recent decades. These philosophies and expectations demand universal educational availability andpportunity, vocational employment oriented education, applied commercialiseable research, and direct contribution tohe growth of the national economy. The economic rationalism attributed to many governments over the past 30 years, haslearly impacted on the missions, values and development of many universities. Their service orientation is now movingerceptibly towards their own private interests. Their service of the public interest has to large degree been reinterpreted andransmogrified as contributing to economic development, thereby appearing to adhere to Friedmanite economic philosophyf the 1970s, namely that the social responsibility of business is to increase its profits.

From a NIS perspective, it is particularly noteworthy that while there is some evidence in universities of transitoryecoupling between the ‘new’ formal values, strategies and processes and informally persisting ‘traditional’ versions of these,he absorption of the corporate and commercial into university life has been comprehensive and pervasive. Universities’e-alignment and compliance with these changed societal and governmental philosophies and expectations, while at timesomplex and non-linear, have been considerable and persistent, reaching deep into university structure and culture.

Much remains to be uncovered and understood. Despite numbers of studies surveying academics’ attitudes, there is anvident need for longitudinal research into their degree of longer term value shifts, patterns of scholarly adaptation, strategiesf resistance, and role reconstruction. In addition, the agenda for further research includes examining cases of universityxceptions and divergence from the global homogenisation trend and investigation of the degree to which national andegional influences differentiate university reactions to global government and market pressures. We also await the morextensive examination of the extent to which contemporary university orientations and structures reflect or diverge fromistorical national tertiary education traditions of earlier eras, and how these have manifested themselves, both in the pastnd present. In more deeply reflecting, historically and contemporaneously, upon the social, political and institutional histo-ies and contexts that university identity and mission have both reflected and driven, we may obtain a clearer understandinghat enables our critique of the present and some influence over the trajectory of the future for the redefined university.

In the end result however, the phenomenon of university corporatisation and commercialisation currently raises moreuestions than it answers. It has produced a radical refocussing of higher education, now repositioned to serve primaryocietal and governmental economic interests, but the longer term implications for the development of humanity’s funda-ental stock of knowledge, and its critique and development of culture, philosophy, ethics, history and the civil society are

endered uncertain and unpredictable.

cknowledgements

Elements of this paper informed the author’s keynote address to the 29th EAIR Forum of The European Higher Educationociety, held in Innsbruck, Austria, August 2007. The paper has also benefited from comments offered by research colleaguescross Australia, UK and New Zealand. The invaluable advice of two anonymous reviewers is also gratefully acknowledged.

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University corporatisation: Driving redefinition