The advent of managerialism in the Ethiopian higher education system and organisational responses through the lens of neo-institutional and resource dependence theories

195 The advent of managerialism in the Ethiopian higher education system and organisational responses through the lens of neo-institutional and resource dependence theories Yohannes Mehari Introduction This chapter analyses the advent of managerialism in the university context. The quest for efficiency, accountability and transparency, which are the results of changes in the external environment, have forced universities to adopt organisational strategies and management structures that are most commonly found in business organisations (see Birnbaum 2001; de Boer, Enders & Leisyte 2007; Tahar, Niemeyer & Boutellier 2011). This development has brought enormous pressures to universities in their efforts to balance the pressures and requirements of business management tools (BMTs) with the internal values, beliefs, norms and practices of universities. At the core of the process of adopting externally-driven BMTs are the perceptions and responses of universities and their academic units to these tools. For this purpose, the chapter explores the Ethiopian higher education governance reform, with a special focus on the advent of “managerialism” as a radical organisational 196 Yohannes Mehari Elias Pekkola & Jussi Kivistö & Vuokko Kohtamäki & Yuzhuo Cai & Anu Lyytinen (Eds.) change tool to ensuring efficiency, effectiveness and accountability in higher education institutions (HEIs). In doing so, it seeks to discuss how Ethiopian public universities and academic units perceive the advent of managerialism in higher education management and how they respond to such pressures and requirements by taking one public university as a case study. The organisational perception and responses of universities to external pressures are analysed through the lens of resource dependence and neoinstitutional theories. In the organisational studies literature, various theories have been developed and used to understand the adoption of a range of reforms and the responses of universities vis-à-vis environmental pressures (see Bastedo & Bowman 2011; Csizmadia, Enders & Westerheijden 2008; Gornitzka 1999; Kirby-Harris 2003; Reale & Seeber 2011; Siegel 2006). Two theories that are most applicable in this case are resource dependence theory (Pfeffer & Salancik 1978) and neo-institutional theory (DiMaggio & Powel 1991). The chapter also seeks to demonstrate how the two theories are used in studying organisational responses to governmental reforms in higher education. The data for the study was taken from the author’s dissertation. It is a qualitative study, which relies on semi-structured interviews with 18 university leaders and members of the academic community as well as documents collected from the national and institutional levels. However, before discussing the theoretical perspectives in detail, it is imperative to first discuss what kinds of changes have been taking place globally in the governance of higher education systems in relation to the advent of new public management (NPM) and managerialism as solutions to the perceived crises of universities. Further, it is also necessary to briefly address why these changes have occurred globally and in the African and Ethiopian higher education system in particular. Managerialism in higher education institutions Several studies in higher education research have witnessed growing changes in the higher education system policy framework of many countries over 197 The advent of managerialism in the Ethiopian higher education system and organisational responses Theoretical and Methodological Perspectives on Higher Education Management and Transformation the past few decades (see de Boer, Enders & Leisyte 2007; Hölttä 1995; Temple 2011). The drivers for change might take various forms at various times, but many agree on some fundamental elements, including but not limited to globalisation, demographic change and the advent of NPM and managerialism in reforming the public sector, in general, by incorporating business management models (e.g. Hood 1991; Pollitt 1993) and HEIs in particular (Temple 2011). The pressures on universities to strengthen central leadership, as opposed to the age-old collegial structure, by involving external stakeholders on boards and in top-down decision-making processes are seen as the growing influence of NPM and managerialism in the governance structure of universities (Carvalho & Bruckmann 2014; Enders, de Boer & Leisyte 2008). In other words, the reform measures in universities, which are influenced by NPM and managerialism, reflect the idea that “universities should be treated and reformed like any other public organisations” (Christensen 2011, 503), and as a result “universities have been put in a situation, in which they have to show that they are worth government’s investments” (Hölttä 1995, 15). The increasing move to instil business values and practices in university management and leadership as solutions to ensuring effectiveness, efficiency and accountability, however, have been under fierce criticism by higher education researchers (see Adcroft & Willis 2005; Birnbaum 2001; Bryson 2004; Larsen & Gornitzka 1995; Stensaker 1998; Temple 2005). Their central argument is that universities are special organisations with their own organisational culture, shaped by the requirements of very specialised professional knowledge and academic freedom (Clark 1983). They further argue that the advent of managerialism disregards traditional values and practices, thus altering the nature of higher education (Birnbaum 2001). Therefore, any attempt to reform universities with business management models are both incompatible and prone to resistance from academia, and at worst, they are likely to fail, without achieving their objective, as promised by those who mandated the reforms (see Christiensen 2011; Teelken 2012). Despite these criticisms and forms of resistance, research shows that many universities around the world “have adopted organisational strategies, 198 Yohannes Mehari Elias Pekkola & Jussi Kivistö & Vuokko Kohtamäki & Yuzhuo Cai & Anu Lyytinen (Eds.) structures, technologies, management structures and values that are commonly found in the private sector” (Teelken 2012, 271). The central question, however, remains whether universities are responding to these external pressures to improve their effectiveness and efficiency, as proposed by policy-makers, or are complying with the requirements to ensure their survival and legitimacy, as accentuated by both resource dependence and neo-institutional theories. Managerialism in the Ethiopian higher education policy framework The provision of higher education in Africa had been predominantly carried out by public institutions in which governments played leading roles in funding, steering and setting the rules of the game in which HEIs operate. However, massive expansions, coupled by meagre financial resources, not to mention the influence of international organisations such as the World Bank and the International Monetary Fund (IMF) through structural adjustment programmes, forced African governments to introduce multiple reform measures driven by the concept of NPM to the higher education sector (Moja 2004; Zeleza 2004). These internal and external forces have accelerated the corporatisation of university management, the commercialisation of learning and the commodification of knowledge (Zeleza 2004). The specific reform measures might take various forms in various African countries, but they all centre on restructuring the leadership and management practices of universities through market-friendly reforms, such as BMTs, to enable universities to effectively and efficiently respond to national and international development challenges (Varghese 2013). As is the case in many African countries, following the massive expansion, the policy framework of the Ethiopian higher education system has also undergone radical change over the past two decades. With a mission to realise a comprehensive “state transformation” and “total system overhaul”, and in line with recommendations by the World Bank, the Ethiopian government has embarked on multiple public governance reforms since the early 1990s 199 The advent of managerialism in the Ethiopian higher education system and organisational responses Theoretical and Methodological Perspectives on Higher Education Management and Transformation (Ashcroft 2010; Saint 2004). Since 2008, the reforms have been targeted at ensuring effective management and governance and a cost-effective, efficient and results-oriented system of management by implementing BMTs as a means for radical organisational change. Some of the major and popular BMTs in the Ethiopian higher education context of reform initiatives are business process reengineering (BPR) and the balanced scorecard (BSC). Both the BPR and BSC reforms advocate for effectiveness and efficiency in the work processes of an organisation. BPR questions the status quo of an organisation by “disregarding all existing structures and procedures and inventing completely new ways of accomplishing work” (Hammer & Champy 1993, 33). In the realm of higher education, BPR targets the transformation of the core-processes, structures and cultures of an organisation, placing the institutional mission before disciplinary priorities, avoiding unnecessary programmes, re-examining and redefining long-held assumptions, finding new ways of measuring performance and reorganising the internal reward structure of universities (Birnbaum 2001). Moreover, despite the fact that BSC is not a radical organisational tool, it shares the basic aspects of BPR, such as effectiveness and efficiency of performance, by focusing on the strategic alignment of organisational goals with the national goals of the country. The government has been exerting mounting pressures on universities to become more innovative, dynamic, responsive, results-oriented, effective and efficient in order to play an important role in transforming the country (Tilaye 2010). Despite strong resistance from academia, almost all public universities have been engaged in the development and implementation of BPR and BSC since 2008 (Kahsay 2012). Moreover, as establishing an integrated planning and performance management system is one of the basic requirements of BPR, the BSC has been found to be a complementary tool for the kind of radical organisational changes envisaged by BPR (Tilaye 2010). Therefore, a closer look at Ethiopian higher education research shows that there are no scholarly studies supported by sound empirical evidence that comprehensively show how public HEIs in Ethiopia perceived and responded 200 Yohannes Mehari Elias Pekkola & Jussi Kivistö & Vuokko Kohtamäki & Yuzhuo Cai & Anu Lyytinen (Eds.) to the implementation of BMTs. Furthermore, despite the need felt by Ethiopian scholars to study these phenomena, it seems that the issues have not been comprehensively studied using relevant theoretical perspectives that have been proven to be important in higher education research. Therefore, this chapter presents how these externally initiated BMTs have been adopted and how universities and basic academic units (BAUs) perceived and responded to them through the lens of resource dependence and neo-institutional theories. Employing resource dependence and neo-institutional theories to understanding the organisational responses of universities to external pressures This section provides the theoretical base for analysing organisational responses to government-initiated reforms. The focus of attention is to understand the ways in which organisations perceived and responded to new institutional environment requirements, demands, expectations and pressures at the university and BAU levels. Organisations of higher education are commonly understood as both technical systems, where the exchange of resources, inputs and outputs are essential for survival, and as social systems, characterised by incorporating actors and relationships where they are constructed and shaped by cultural systems embodying symbolically-mediated meanings (Scott & Christensen 1995a; Scott & Davis 2007). This implies that “every organization exists in a specific physical, technological, cultural, and social environment to which it must adapt” (Scott & Davis 2007, 19). Thus, the organisational response of universities and their BAUs to institutional pressures is here explored through a combination of resource dependence (Pfeffer & Salancik 1978) and neo-institutional (DiMaggio & Powell 1991) theories, which advocate the use of resources and social norms, respectively, as tools of organisational survival. Several studies show that these theories provide distinct but complementary explanations regarding why and how organisations respond to institutional pressures (Gornitzka 1999; Greening & Gray 1994; Oliver 1991). Both theories are based on the common assumption that the survival of an organisation 201 The advent of managerialism in the Ethiopian higher education system and organisational responses Theoretical and Methodological Perspectives on Higher Education Management and Transformation largely depends on its responsiveness to external pressures, demands and requirements (Hrebeniak & Joyce 1985; Pfeffer & Salancik 1978). However, these theories also exhibit important differences. For example, for resource dependence theory, the foci are the ability to make strategic choices and the adaptive capability to guarantee a constant flow of resources that are important for the survival of the organisation (Pfeffer & Salancik 1978). Nevertheless, neo-institutional theory places more emphasis on the role of intuitional pressures, such as the myths, beliefs, norms, values, rules and procedures that influence the behaviour of an organisation (DiMaggio & Powell 1991). Resource dependence theory in HEIs Despite the fact that major organisational theories, namely resource dependence theory (Pfeffer & Salancik 1974; 1978), the garbage can model (Cohen & March 1986), the loose coupling concept (Weick 1976) and many insights about institutional theory (Meyer & Rowan 1978; Thornton 2004), are built on educational organisations in general and HEIs in particular (Cai & Mehari 2015), the use of resource dependence theory in higher education research mainly came to the fore in the 1990s (e.g. Goedegebuure 1992; Huisman 1995; Gornitzka 1999). It is a popular theory in the social science disciplines. It is specifically aimed at explaining organisation-environment relations, and it depends on a particular view of interand intra-organisational interactions (Pfeffer & Salancik 1978). Resource dependence theory is constructed to explain how organisations respond strategically and make active choices to manage their dependency on those parts of their task environment that possess important resources. Resource dependence theory has three major assumptions. First, it starts from the very basic assumption that every organisational action is primarily guided by securing its survival. Second, the more organisations are dependent on the resources of a particular supplier, the more vulnerable they will be to following the rules and regulations of that resource provider. Conversely, when dependency is low, it is normal to expect an organisation to resist pressures coming from the environment. Third, this dependency on environmental 202 Yohannes Mehari Elias Pekkola & Jussi Kivistö & Vuokko Kohtamäki & Yuzhuo Cai & Anu Lyytinen (Eds.) factors, however, does not necessarily mean that organisations are always passively vulnerable to the environment; rather, organisations can respond to and manipulate their environment to fit their capabilities (Patterson 2004) and set strategic choices regarding how to manage external environmental pressures (Rhoades 1992) by protecting, safeguarding or increasing the resources that they need to improve their performance, decrease uncertainty and survive (Pfeffer & Salancik 1978). As resource dependence theory postulates an organisation’s need to do more than adapt internally in order to be competitive (Bess & Dee 2008, 149), HEIs should thus be in a position to establish strategic relationships with various other organisations that control vital resources. For instance, there are some strategies or techniques that organisations, including HEIs, normally use to address dependencies (Pfeffer & Salancik 1978) and that ultimately enable them to develop the power to resist direct influences from the environment (Bess & Dee 2008). These techniques, which are visible in HEIs, are dependency reduction, external linkages and the enactment of a new environment (Bess & Dee 2008, 149). Neo-institutional theory in HEIs Since the seminal work of Meyer and Rowan (1977), institutional theory has become a popular explanatory tool in organisational studies. Even though the emergence of institutional theory dates to the 1940s, having gained popularity since the 1980s, it only gained the attention of higher education researchers in the 1990s. Since then, it has shown steady growth in its application to institutional analysis in higher education research (Cai & Mehari 2015). The use of neo-institutional theory in higher education research has largely focused on understanding policy and management issues, with a special focus on environmental and organisational relationships, isomorphism and institutionalisation (Cai & Mehari 2015). Institutional theory “is not usually regarded as a theory of organizational change, but as usually an explanation of the similarity (“isomorphism”) and stability of organizational arrangements in a given population or field of 203 The advent of managerialism in the Ethiopian higher education system and organisational responses Theoretical and Methodological Perspectives on Higher Education Management and Transformation organizations” (Greenwood & Hinings 1996, 1023). However, it incorporates important elements that provide a clear model of change aimed at linking organisational context and intra-organisational dynamics (Greenwood & Hinings 1996). Despite the fact that institutional theory has taken on a variety of forms (DiMaggio & Powell 1991; Scott 1987), its central concern remains the manner in which organisations exist and function in an environment dominated by rules, taken-for-granted assumptions, myths and norms that are considered to be appropriate and acceptable organisational practices and behaviours (DiMaggio & Powell 1991; Meyer & Rowan 1977; Oliver 1991; Scott 1987). A plethora of studies within neo-institutional theory emphasise the survival value of organisational conformity to institutional environments (e.g. see DiMaggio & Powell 1991; Scott 1987; Tolbert & Zucker 1983). For organisations to survive and be socially accepted, they have to conform ceremonially in an institutionalised environment to rationalised myths composed of accepted cultural rules. In other words, failure to respond in accordance with norms and expectations may lead to conflict and illegitimacy (Diogo, Carvalho & Amaral 2015). This implies that an organisation’s adoption and implementation of reforms or programmes which are supposed to bring organisational change are significantly determined by the extent to which the measure to be adopted is institutionalised, be it by law or gradual legitimation (Tolbert & Zucker 1983). 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