Performance management in Universities: an ‘old’ institutional economics perspective

Broad, M.J. (2010) Performance management in Universities: an ‘old’ institutional economics perspective. MARG2010: Management Accounting Research Group Annual Conference, Birmingham, United Kingdom. 18 - 19 Nov 2010. 13 pp .

Abstract

This paper reports on a research project that builds on previous work by Broad, Goddard & Von Alberti (2007) and Broad & Goddard (2010). The focus of this paper is to consider an ‘old’ institutional economics perspective in the evolution of performance management systems within the university sector. The research will compare the findings of the UK sector with research undertaken in Singapore to develop an international comparative context.

An Old Institutional Economics (OIE) perspective was linked with accounting research during the 1990’s (see Ahmed & Scapens, 2000) although its origins date back the turn of the 20th Century (Veblen, 1919). The OIE approach views the institution as an economic entity and seeks to understand the processes by which it operates and “provides a potentially useful basis for understanding the institutionalised character of organisational routines and rule-based behaviours, such as accounting” (Ahmed & Scapens, 2000 p.167)

Broad & Goddard (2010) argue that there is a particular managerial weltanshauung within the higher educational institutions they studied that embed the rules, routines, habits, and potentially the culture, of performance management. Such a weltanshauung, it is suggested, links with the OIE view that institutions are defined as “a way of thought or action of some prevalence or permanence, which is embedded in the habits of a group or the customs of a people” (Hamilton, 1932 p.84).

The focus on the notion of rules, routines and habits within the institution provides a unique lens by which to view an organisation to help understand the barriers/ enablers of how such a performance system is developed. Sorlin (2007) contends that such performance systems might not be developing in the most efficient manner due to pressure of funding donors and research has been called for in this area by Bignall & Modell (2000, p.301) to further understand the “core concepts of integration and balance in performance management design”.

This paper will therefore review the principles of Old Institutional Economics and its application to the accounting literature, particularly focussing on performance management within the university sector and further developments of this research project.

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