Management Control Systems in Universities Másolata

Submitted by
Daniela Zweimüller
Submitted at
Institut für Management
Accounting
Supervisor
Univ.-Prof.in Dr.in Dorothea
Greiling
Co-Supervisor
MMag.a Judith Frei
December 2018
MANAGEMENT CONTROL
SYSTEMS IN UNIVERSITIES
Diploma Thesis
to obtain the academic degree of
Magistra der Sozial- und Wirtschaftswissenschaften
in the Diploma Program
Business Education
JOHANNES KEPLER
UNIVERSITÄT LINZ
Altenberger Straße 69
4040 Linz, Österreich
www.jku.at
DVR 0093696
STATUTORY DECLARATION
I hereby declare under oath that the submitted diploma program thesis has been written solely by
me without any third-party assistance, information other than provided sources or aids have not
been used and those used have been fully documented. Sources for literal, paraphrased and cited
quotes have been accurately credited.
The submitted document here present is identical to the electronically submitted text document.
Linz, December 2018
Signature
14. December 2018 Daniela Zweimüller II

Table of Contents
1. Introduction ............................................................................................................................... 1
1.1. Statement of problem ........................................................................................................ 1
1.2. Structure of the thesis ........................................................................................................ 2
2. Purpose of Thesis ...................................................................................................................... 3
3. Research questions .................................................................................................................... 4
4. Management Control Systems .................................................................................................. 5
4.1. Definition of MCS ............................................................................................................. 5
4.2. Purposes of MCS ............................................................................................................... 6
5. Theoretical explanations ........................................................................................................... 6
5.1. Conception of Performance ............................................................................................... 6
5.1.1. Performance Measurement .................................................................................... 8
5.1.2. Performance Management ..................................................................................... 9
5.1.3. Performance responsibilities in universities ........................................................ 11
5.1.4. Accountability of universities .............................................................................. 14
5.2. Benchmarking ................................................................................................................. 15
5.2.1. Procedure of Benchmarking ................................................................................ 16
5.2.2. Indicators for Benchmarking ............................................................................... 17
5.2.3. Success factors of Benchmarking ........................................................................ 18
6. Designs / Frameworks of MCS ............................................................................................... 19
6.1. Simons’ Levers of Control .............................................................................................. 19
6.2. The design of Merchant/Van der Stede ........................................................................... 20
6.3. The design of Malmi / Brown ......................................................................................... 22
7. Management of universities .................................................................................................... 23
7.1. New Public Management ................................................................................................ 24
7.2. Bologna Process .............................................................................................................. 25
7.3. Intellectual Capital .......................................................................................................... 25
14. December 2018 Daniela Zweimüller III

8. Theoretical approaches ........................................................................................................... 27
8.1. Contingency theory ......................................................................................................... 27
8.2. Principal-Agency-Theory ................................................................................................ 28
8.3. Stakeholder theory........................................................................................................... 30
8.4. Self-Determination-Theory ............................................................................................. 31
8.5. Connection of theoretical approaches ............................................................................. 33
9. Meta-analysis .......................................................................................................................... 35
9.1. Methods ........................................................................................................................... 35
9.2. Grid of article results ....................................................................................................... 39
9.3. Scheme of coding ............................................................................................................ 52
9.4. Descriptive analysis of the studied articles ..................................................................... 53
9.5. Internal factors impacting the introduction of MCS ....................................................... 56
9.6. External factors impacting the introduction of MCS ...................................................... 66
9.7. Internal factors impacting the execution of MCS ........................................................... 69
9.8. External factors impacting the execution of MCS .......................................................... 77
10. Discussion and limitations ...................................................................................................... 84
11. Conclusio ................................................................................................................................ 93
12. Bibliography ........................................................................................................................... 94
13. Appendix ............................................................................................................................... 106
14. December 2018 Daniela Zweimüller IV

Table of Figures
Figure 1: PMS: Regulating and controlling process ...................................................................... 10

Figure 2: Indicators for Benchmarking .......................................................................................... 17
Figure 3: Levers of Control - Simons ............................................................................................ 19
Figure 4: MCS as a package - Malmi / Brown............................................................................... 22
Figure 5: Internal and external university stakeholders ................................................................. 31
Figure 6: Connection of theoretical approaches ............................................................................. 33
Figure 7: Published articles sorted by publication year ................................................................. 53
Figure 8: Published articles sorted by journals .............................................................................. 54
Figure 9: Published articles sorted by geographical location ......................................................... 55
14. December 2018 Daniela Zweimüller V

List of Tables
Table 1: Selection of articles .......................................................................................................... 36

Table 2: Inclusion and exclusion criteria ....................................................................................... 37
Table 3: Grid of articles ................................................................................................................. 51
Table 4: Cluster coding .................................................................................................................. 52
14. December 2018 Daniela Zweimüller VI

Abbreviations
cf. ....................................................................................... confer/conferatur (=compare)

e.g. ..................................................................................... exempli gratia (=for example)
et al. ................................................................................... et alii (=and others)
et seq.................................................................................. et sequentes (=and the following)
et seqq................................................................................ et sequentes (=and following)
etc. ..................................................................................... et cetera (=and the rest)
i.e. ...................................................................................... id est (=that is)
IC ....................................................................................... Intellectual Capital
MCS .................................................................................. Management Control System
NPM .................................................................................. New Public Management
PMS ................................................................................... Performance Management System
PhD .................................................................................... Philosophiae Doctor
SDT ................................................................................... Self-Determination-Theory
14. December 2018 Daniela Zweimüller VII

1. Introduction
1.1. Statement of problem
Every company as well as every organization needs adequate management and control systems to
ensure its continued existence. The control systems which are used depend on the size of the com-
pany, whereby the size of the company or organization and the used controlling instruments are
correlating.1 Somewhen crises occur in the economy, which can often be prevented by Manage-
ment Control Systems (MCS). But not only in crisis situations, but also in the daily routine of
companies, it is of particular importance to integrate control systems in order to react as quickly as
possible to errors and weaknesses. Due to increasing internationalization, MCS are becoming more
and more important - companies are demanding more and more flexibility and, rapid changes as
well as adaptation processes already belong to the daily task spectrum of the enterprises. Only those
who react quickly to these changes remain competitive and successful.2 However, these changes
due to advancing technology and globalization are not only facing companies, but also universities.
Especially in recent times, the media is focusing more on the organization and management of
universities. Above all the achievements of the research institutions, the teaching and education
systems at universities which are state-subsidized educational institutions, are discussed, both po-
litically and socially. The goal is to equitably divide resources among universities, but as every-
where, public resources are limited, leading to competition between universities.3 As a result of
this competition, the education sector is increasingly following a market-oriented development.
This in turn leads to a necessary development of visions, mission statements, individual profiles of
universities, special teaching and study programs, etc., so that they remain competitive in the mar-
ket and generate sufficient registrations of qualified students.
But not only limited resources lead to growing challenges of universities, but this dependence
through public funding also leads to increased demand for transparency in management. Funding
bodies, the government in general and, of course, society also want to know how and for what these
funds are used and what outputs / outcomes are achieved. As a result, universities need to disclose
their processes, performance, outputs, and outcomes, and implement appropriate tools to measure
those outputs / outcomes. Some outputs from universities are easily measurable, such as the pub-
lished publications or the number of students' degrees. Unlike in private companies the focus is not
mainly on the increase of profit as a university has a very broad range of tasks with many tasks that
are difficult to quantify - for example, in the entire "Third Mission" area (including, for example,
1 cf. Anthony, R. N./Young, D. W. (1988), p. 3.

2 cf. Weidel, M. (1997), p. 330.
3 cf. Hubig, L. (2009), p. 1.
14. December 2018 Daniela Zweimüller 1

relationships with private companies), the measurement of outputs / outcomes becomes consider-
ably more difficult. This requires management systems which are qualitatively oriented.
Universities became and still become more and more like companies in a market economy. Histor-
ically, initiatives were launched in the 1960s and 1970s to redesign the budgeting process. Subse-
quently, the New Public Management (NPM) emerged in the 1980s, which dealt with this topic in
more depth and pursued an improvement in the performance of public institutions. The NPM aims
to meet the challenges of the increased competitive situation by means of predetermined standards
and output controls.
Above all, the management of higher education institutions should be more professionalized - the
traditional leadership of universities by academics, which put their emphasis on teaching and re-
search, is replaced by professional managers who hold the functions and activities of the rectors.4
In Europe also the implementation of the Bologna Process of the European Union of 1999 sup-
ported the growing of competition in the tertiary education sector as markets have opened up to
allow establishment of more institutions of higher education to provide a higher quality of service
and education.
These trends in education are also making it increasingly important to backlight the management
of educational institutions. Universities are in a market that is more and more similar to the eco-
nomic market. Instruments of control should also appeal to universities because the management
of those public institutions needs to focus on the successful survival of the university as well.
As a result, universities are striving for a strategic orientation towards entrepreneurship and there-
fore need to introduce MCS into their everyday life in accordance with their strategic orientation,
while at the same time introducing MCS into the operational area due to the increased demand for
information and transparency in the use of (financial) resources and the achievement of objectives
through previous reforms.
How universities cope with this need for new MCS and how to handle the introduction of MCS has
been poorly dealt with in the literature (also due to timely developments). Therefore, this thesis
deals with the topic of MCS at public universities and backlights introduction processes of MCS
and the handling of already introduced MCS in universities.
1.2. Structure of the thesis
The diploma thesis is basically divided into two major sections. The first area includes the objective
and relevance of this thesis as well as theoretical foundations and theoretical approaches of the
4 cf. Bogt, H. J./Scapens, R. W. (2012), p. 454.

MCS at universities. The second part of the thesis is a meta-analysis of selected articles. This area
begins with the presentation of the selected research methodology, followed by a descriptive eval-
uation of the selected articles from journals. The two sections are reunited in the final part of the
discussion, in which the research questions are answered, and limitations are to be determined. A
conclusion should summarize the essential contents and findings of the work and give an outlook.
2. Purpose of Thesis
Although all companies and organizations use some form of MCS, not much literature has been
published on this topic. Although a relatively large amount of English literature on MCS can be
found at first sight, just a few authors place their focus on MCS as an overall system. MCS as an
overall system means the consideration of the connectedness of all single MCS in an organization.
Each instrument, each system has an impact on other systems and areas, therefore it would be from
particular importance to consider those interrelations under a holistic view over all MCS used in
the special context of a university.
Often, only parts of the MCS are theoretically deposited and the associated system behind it is
neglected. Especially in connection with educational institutions and especially with universities,
not much literature can be found on this topic. Empirical studies on MCS as an overall system are
also rarely found.
It seems that the MCS in universities have not received enough attention yet, so this work should
first give an overview of the MCS and its design options as well as previous and ongoing develop-
ments in the tertiary education sector. Due to limited research contributions, not only literature on
MCS in universities was included, but also MCS in tertiary sectors and MCS in higher education
were included. Universities, tertiary sectors and higher education are thus not to be equated and
used synonymously, but publications and literature in the individual areas often draw conclusions
about the field of universities and provide insights that could not have been found by the strict
search for MCS in universities. In this thesis, the terms "tertiary sector", "universities" or "higher
education" are often used, depending on the area to which the respective authors have referred.
Following the theoretical foundations, numerous publications on MCS in universities are analyzed
by means of a meta-analysis and combined into a common result. Above all, the focus will be on
the influencing factors in implementation and execution processes of MCS at universities. The
results of the meta-analysis will be compared with the previous literature. Furthermore, a discus-
sion of any possible differences, similarities and research needs according to the current state of
research will be revealed.
The relevance of this work lies in presenting a far-reaching but nevertheless compact overview of
the subject of MCS in universities. This overview is intended to facilitate the results of previous

qualitative and quantitative surveys and publications. In addition, the aggregation and analysis of
the collected data will provide new insights and uncover any problem areas with regard to this
topic.
3. Research questions
Research questions that derive from the purpose of the thesis are the following:
• Which internal and external factors influence the selection, implementation and execution
of MCS in universities?
• How can the Principal-Agency-Theory help to explain MCS in terms of relationships with
external stakeholders in the context of universities?
• How does the Self-Determination-Theory (SDT) act as a part in the selection, introduction
and execution of personal and cultural controls in the management of universities?

4. Management Control Systems
In the theoretical foundation a basic knowledge of MCS will be presented. Definitions, intentions
as well as functions of the MCS are processed.
4.1. Definition of MCS
Historically seen, MCS have been mentioned first 1972 by a professor of Accounting and Financial
Management at the University of Sheffield in South Yorkshire, England. He wrote about four main
reasons for the implementation of planning and control systems:
“The need for a planning and control system within a business organization flows from certain
general characteristics of the nature of business enterprises, the chief of which are follows:
Firstly, the enterprise has (by definition) organizational objectives, as distinct from the separable
and individual ones of the members constituting the 'managerial coalition';
Secondly, the managers of the sub-units of the enterprise must necessarily be ambivalent in view
of their own personal goals, as well as have a good deal of discretion in deciding how they should
behave and in formulating their part of any overall plan to achieve organizational objectives;
Thirdly, business situations (and people's behavior) are full of uncertainty, internally as well as
externally to the business enterprise.
Fourthly, there is a necessity to economize, in human endeavours we are invariably concerned with
an allocation of effort and resources so as to achieve a given set of objectives using the minimum
amount of total economic resources and effort; or alternatively put, to achieve a maximum amount
of objective attainment, given a specified amount of resources and effort.”5
A first framework for MCS was developed by Anthony (1965) at Harvard Business School, focus-
ing on two goals. Firstly, more than just accounting information has been considered and secondly,
motivation and behavior of managers were taken into account.6
In addition, Merchant / Van der Stede (2012) mention that MCS include all means and systems
used by managers to ensure that employees’ behavior and decisions are consistent with the organ-
ization's goals and policies. From this point of view MCS also highly address employees and crit-
ically question whether the employees behave appropriately and understand what is expected of
5 Lowe, E. (1971), p. 1
6 cf. Otley, D. (1999), p. 364 et seq.

them, if they work hard and try to reach the expected goals and if they are capable of doing a good
job.7
It is important to understand that MCS do not consist of one system, but of many systems, but they
have to be considered as a package or as a whole. Any system, such as budgeting or a balanced
scorecard, can be defined as a MCS. Subsequently, most companies have already integrated a lot
of MCS into their organization network. Nevertheless, it is clear that many systems were introduced
by different stakeholders at different times and therefore probably used and considered individu-
ally.8
4.2. Purposes of MCS
The aim of MCS is to improve the management's activities and performance by using them. The
strategic goals of a company should be achieved in the best possible way. If there are any mis-
matches between the goals of the employees and the goals of the company, they should be identified
and eliminated as soon as possible by using MCS.9
As mentioned before, Management Control should always be seen as an overall system. Maciar-
iello says Management Control needs both: the consideration of planning and control.10 In addition,
not every system can be applied to every business, the MCS need to be adapted to the culture that
is practiced in companies and furthermore involve employees in decision-making processes and
develop a corresponding incentive system.11 Implementing MCS does not automatically improve
management performance or behavior. For achieving improvements, proactive elements also need
to be part of it so that impending risks, crises and mistakes can be averted in good time.12
5. Theoretical explanations
5.1. Conception of Performance
The performance term has a multidimensional meaning, so a definition is needed to avoid ambigu-
ity. Performance generally, refers to the characteristics and benefits that an organization, a process,
7 cf. Merchant/Van der Stede (2012), p. 5 et seqq.

8 cf. Malmi/Brown (2008), p. 291.
9 cf. Ekanayake, S. (2004), p. 49.
10 cf. Maciariello, J. A. (1978), p. 3.
11 cf. Atkinson et al. (2007), p. 353.
12 cf. Merchant/Van der Stede (2012), S. 4f.

a product, a machine, or an individual creates. Performance in an organization refers to financial
variables like. e.g. profit, turnover or non-monetary values such as e.g. market share or delivery
reliability.
In the case of process performance, for example, the throughput time of orders, the scrap rate of
machines or, in the case of individuals, e.g. the leadership potential of employees is observed. Thus,
the performance term encompasses a particularly wide viewing angle, which, depending on the
situation and objective, certainly varies and / or combines different aspects.13
Neely et al. (1996) explain performance by means of their definition:

“Performance is efficiency and effectiveness of purposeful action.“14
Lebas / Euske (2002) supplement this definition with a temporal view of performance: “Perfor-
mance is doing today what will lead to measured value outcomes tomorrow.”15
The two terms effectiveness and efficiency used in the first definition by Neely et al. (1996) can be
seen as attributes of performance and also require more detailed clarification.
Effectiveness describes the degree of achievement of business objectives, e.g. the increase in profit
or liquidity, whereby the effectiveness therefore directly relates to the envisaged targets. Thus, the
effectiveness is of strategic importance - often the phrase "to do the right things" is associated with
effectiveness.16
Efficiency has to be differentiated from effectiveness. Efficiency is related to the operative level of
a company. For example, in achieving the relevant goals with the least possible use of resources
(input-to-output-relation). The phrase "to do things right" is associated with efficiency.
More generally, efficiency can thus also be understood as the improvement of states (for example,
input / output ratio) in alternative courses of action.
Since the effectiveness or efficiency of an action depends not only on the alternatives of action, but
always on the considered objectives, it is necessary to specify all the goals to which one refers in a
concrete situation.17
13 cf. Hilgers, D. (2008), p. 33.

14 cf. Neely et al. (1996), p. 5.
15 cf. Lebas/Euske (2002), p. 10.
16 cf. Hilgers, D. (2008), p. 34.
17 cf. Hilgers, D. (2008), p. 34.

Performance measurement and performance management have always been central concerns of
private companies. Meanwhile, the classic financial ratios have been radically expanded through
non-monetary, strategic variables such as potential for success and competitiveness.
As a result of the changed requirements and conditions of action, the public sector is also beginning
to include performance measures conceptually and systematically in the management of public
organizations. In the context of the worldwide movement of NPM, output and outcome orientation
has become a core element of state and administrative reforms.18
Consequently, the term ‘performance’ is an ambiguous term and not simply definable as it does
not specify to whom an organization is delivering its performance. Otley (1999) assumed that an
organization that is performing well is an organization that is successfully achieving its objectives.
However, he believes that an effective implementation of an appropriate strategy is indispensable
for a successful attainment of objectives. Nevertheless, a stronger focus on relevant stakeholders
needs to be carried out for an appropriate definition of performance.19
5.1.1. Performance Measurement
The evaluation of various economic issues is one of the central tasks of the management. In order
to carry out this assessment, suitable criteria are required.20
The performance measurement finds its embedding within the operational information supply sys-
tem and serves the information acquisition and processing and as a result as the basis of corporate
management.21
The core of performance measurement, like the term already suggests, is formed by quantified
metrics such as measures that represent the result of a measurement process. These performance
measure metrics are called "performance measures" (synonyms are also metrics, ratios, key perfor-
mance indicators). Multiple performance metrics linked together form a performance measurement
system.
To describe the performance of companies and organizations in the sense of a holistic approach to
the mapping of monetary and non-monetary and thus multidimensional variables in multidimen-
sional targets, a combination of ratios and indicators must be used regularly.22
18 cf. Hilgers, D. (2008), p. 5.

19 cf. Otley, D. (1999), p. 364.
20 cf. Hilgers, D. (2008), p. 35.
21 cf. Horvath, P. (2002), p. 578.
22 cf. Hilgers, D. (2008), p. 38.

5.1.2. Performance Management
To explain performance management, two definitions are first presented that describe performance
management and illustrate the relationship between performance measurement and performance
management:
“Performance measurement is the process of assessing progress toward achieving predetermined

goals. [...] Performance management is building on that process, adding the relevant communica-
tion and action on the progress achieved against these predetermined goals.”23
„Performance management is a management approach supported by methodologies, metrics, pro-

cesses and (information) systems, all oriented towards the realization of the objectives of an or-
ganization.“24
Performance management is understood to mean a system for controlling and influencing the com-
pany's performance (corporate business performance) as well as individual employee performance.
Two concepts of steering are distinguished by the concepts of regulating and controlling. In regu-
latory processes, attempts are made to achieve a certain expression of the variable to be regulated,
whereby based on feedback on the current degree of achievement of goals, possible solutions are
sought, actions taken, and disturbances compensated after their occurrence.
Control processes should also achieve a certain degree of relevant size, but this is done via a feed-
forward process. As a result of this "pre-coupling", solutions are adopted early on, or framework
conditions are chosen in such a way that the achievement of the objectives is guaranteed.25
For optimal control, a combination of (pre-)control for the early detection of new challenges and
regulatory processes for the compensation of occurring deviations would be best. The implemen-
tation of such a combination can take place through a process with the phases of planning, realiza-
tion and control, resulting in a performance management system (PMS).26
23 cf. Bourne et al. (2003), p. 15 et seq.

24 cf. Leysen/Nuffel (2006), p. 20.
25 cf. Grüning, M. (2002), p. 8.
26 cf. Grüning, M. (2002), p. 8.

Figure 1: PMS: Regulating and controlling process27
In the literature, the separation of performance measurement systems and performance manage-
ment concepts is often fluid, so that a functional distinction between the tasks of performance
measurement and performance management is not always easy to be undertaken.28
Taking into account the above definitions, it can be said that performance measurement is at the
heart of performance management. However, in order to have an active impact on performance,
the reconciliation activities should focus on the drivers rather than the performance outcomes.29
The performance management understanding is based on a practice that understands agreements
and decisions as core functions of management under the special consideration of performance or
situation assessment (measurements).30
Performance management therefore goes beyond the classic performance measurement ap-
proaches, since entrepreneurial performance must not only be captured, but actively generated and
influenced.31
27 Own representation based on Grüning, M. (2002), p. 8.

28 cf. Hilgers, D. (2008), p. 52.
29 cf. Kermally, S. (1997), p. 5 et seq.
30 cf. Heitmann et al. (2005), p. 77.
31 cf. Krause, O. (2007), p. 36 et seq.

5.1.3. Performance responsibilities in universities
In the last decade there have been unprecedented pressures which faced primary many public ser-
vice organizations and later also universities which consequently, led to reforms in universities.
Those pressures are for example: cuts in state funding, difficulties in financing universities with
public funds, the emerge of new approaches like NPM and greater competition between universi-
ties. Through growing demands for more competition, efficiency, effectiveness and accountability
universities have introduced control mechanisms, assessments for organizational performance and
PMS. Universities themselves sometimes rethink their forms of management, government and or-
ganization and try to move from traditional models of participative management which was a bu-
reaucratic-collegial model towards a more entrepreneurial model of management.32
As part of NPM's reform efforts, results-based management has been on the agenda for the past
two decades. NPM builds on a broad framework at the interface between administration and soci-
ety, but also between administration and politics as well as administration and economy. This me-
ans an increased emphasis on the performance and impact components of public administration,
especially in relation to the citizen, but also in internal issues of profitability, rationality of action
or remuneration.
In business terminology, performance is inter alia understood in monetary terms as a counter-term
to costs and as a result of goods production in the interaction of the used production factors (labor,
capital, etc.), e.g. valued by the market in cash. This relationship applies to public administrations
only to a very limited extent. Public administrations preferably provide such services where the
market mechanism fails or where the market would provide a service that is politically and socially
undesirable.33
Thus, public administrations predominantly create services that lack the market price as a bench-
mark and do not have a direct, causal link between revenues and the costs incurred for the provision
of services.34
For the performance of public administrations, therefore, in addition to the purely monetary factors
there must be considered as performance features:
• the quantity and time characteristics of services,

• the quality of services and
32 cf. Melo et al. (2010), p. 234.

33 cf. Löffler, E. (2000), p. 50.
34 cf. Klingebiel, N. (1999), p. 40 et seq.

• the effects achieved with the performance
Subsequently, the focus is increasingly on the result of administrative action and thus on the output
and outcome, which explains the approaches to output-oriented management controls.35
Universities are considered as organizations which are responsible for the process to turn inputs
such as time of students and the time of academics into outputs, which can generally be classified
as teaching, research or third mission.36
The third mission of universities is based on the following ideas:
Increasing student numbers on the one hand, decreasing financial resources of public budgets on
the other and at the same time the development of society into a knowledge society require an
expansion of the range of tasks. Transfer, whether through activities or people, the need for lifelong
learning, entrepreneurial activities of universities and the interest of business and society in general
in the performance of universities, fundamentally affect the university system and sometimes lead
to change. Politically, these developments are also being promoted. It shows an increasing orien-
tation of universities on the economy. Cooperations with companies, contract research or
knowledge and technology transfer have been carried out for years. At the student level, a strong
economic orientation can be observed as well. These activities and considerations were referred to
as "Third Mission". However, the third mission goes well beyond economic cooperation. Above
all, it focuses on linking universities and their members with civil society. Social or regional com-
mitment, benefits for society, social innovations or further education and cooperation with civil
society partners are part of Third Mission on a par with partnerships with companies. Direct ex-
change and interaction are the core of this third mission.37
The description of the "Third Mission" tasks shows that it is not always easy to evaluate and assess
the performance of universities, as the tasks are very widespread. As an example, here are the tasks
of an Austrian public university according to the “Bundesministerium für Wissenschaft, Forschung
und Wirtschaft” (BMWFW; Federal Ministry of Science, Research and Economy in Austria),
which include in particular:
• the development of science or art and their mediation;
35 cf. Kommunale Gemeinschaftsstelle für Verwaltungsmanagement (KGSt) (2005a), p. 24.

36 cf. Melo et al. (2010), p. 236.
37 cf. Roessler et al. (2015), p. 4.

• the scientific or artistic vocational training and the qualification, for occupational
activities involving the application of scientific or artistic knowledge and methods;
• the training of scientific and artistic young people;
• the further education of the graduates in particular;
• the support of national and international cooperation in the Area of scientific re-
search and teaching or exercise the art and its teaching;
• supporting the use and implementation of their research results or the development
of the arts in practice;
• the sustainable use of resources.38
The outcomes of universities are long-term products, such as forming a well-educated society. This
process is monitored and controlled and at the end, the output or outcome is compared with the
predefined goals, and if there is a difference between the planned and current outcomes, corrective
actions are taken. A well-developed PMS should be able to provide information on key roles, pro-
mote appropriate behavior, and provide tools that provide increased accountability and control and
evolve steadily through continuous learning.39
PMS in universities are therefore concerned with measuring performance in the areas of teaching,
learning, research, performances of all stakeholders of universities such as academics, students,
employees, partners, etc. Some of this information is passed on to centralized administrations and
serves as a basis for assessment mechanisms such as RAE (Research Assessment Exercise) and
QAA (Quality Assurance Agency), teaching assessments.40
However, the great difficulty with new orientations lies in the proof of cause and effect or also in
the measurability of services provided by universities. Because far not all the services of a univer-
sity can be so easily measured and quantified. Finally, this raises the question of how a pursuit of
increased efficiency and effectiveness can be established in the university sector. What does effi-
ciency and effectiveness really mean in the university context?
The answer to the question is complex and cannot be given without considering all underlying tasks
of universities. In any case, the trend is that efficiency and effectiveness should be increased
through performance and quality assessments. Such performance and quality assessments can take
many forms such as the evaluation of courses and programs, performance- and quality-oriented
resource allocation, ranking of universities, evaluation of research results and study programs.
38 cf. Bundesministerium für Wissenschaft, Forschung und Wirtschaft (BMWFW) (2016), p. 20.
39 cf. Melo et al. (2010), p. 236.
40 cf. Melo et al. (2010), p. 247.

5.1.4. Accountability of universities
The definition of accountability is very complex and always dependent on the environment. Since
the beginning of the NPM, the term ‘accountability’ has been increasingly highlighted. NPM's
public-sector reforms have replaced bureaucratic accountability, which relates civil servants with
their superiors on a hierarchical level, through managerial accountability, as the role of many civil
servants changed from administrators to managers.41
In universities, institutions and academics are required for increased accountability to both internal
and external stakeholders42, and in many countries central education and science ministries are
reviewing the mechanisms used to improve accountability in universities. Melo et al. (2010) de-
scribe that there are two types of accountability in universities that need to be considered: profes-
sional accountability, which is based on expertise, and managerial accountability, where tasks are
delegated according to predefined performance criteria.43
The new systems introduced by NPM in universities have increased competition between univer-
sities and universities themselves are striving for greater effectiveness and efficiency. The intro-
duction of PMS makes performance visible - inwards and outwards. Considering these circum-
stances, one might speculate that the managerial accountability in universities has risen sharply and
the professional accountability suffers from the introduction of the new systems and is neglected.
However, this is not the case. The environment of universities is still characterized by professional
accountability, even though the level of managerial accountability has risen sharply. This means
that professional and managerial accountability can co-exist and do not exclude each other.44
In many countries, this increased accountability is also crucial for the funding of universities, so
government funding often depends on performance in research and teaching. Research perfor-
mance is usually measured by the number of publications in academic journals, using the rankings
of these journals as a quality feature. Teaching performance refers to the number of students, the
degrees achieved, and the quality of the education provided.45
41 cf. Mattei, P. (2009), p. 34 et seqq.

42 A more detailed explanation of internal and external university stakeholders follows in Chapter 8.3.
43 cf. Melo et al. (2010), p. 237.
44 cf. Melo et al. (2010), p. 238 et seqq.
45 cf. Ter Bogt/Scapens (2012), p. 454 et seq.

5.2. Benchmarking
Benchmarking is a method of business management that can be seen in the context of an organiza-
tion's quest for optimal processes and structures. Benchmarking seeks to find the best, most suc-
cessful solution in practice for certain questions and subsequently, to adopt it to one's own area.
According to Schedler/Proeller (2000) benchmarking consists of two elements:46
1. The aspect of learning is in the foreground, above all in previous applications in the private
sector. Thus, benchmarking is part of the quality management of the individual institution.
2. The aspect of comparison becomes important if inefficiencies without a market are to be
revealed. In this respect, benchmarking contains a competitive component.
With the introduction of benchmarking, the reference to the past should be supplemented by a
reference to the present. The comparison should not only be done with oneself, but also with others.
The concept of quality standards is included in this context. Quality standards enable consistent
quality management, which in turn should sustainably improve the performance of an administra-
tion. The overriding idea is learning from the others and learning from the market.
Considering those backgrounds of benchmarking, it has a significantly stronger qualitative com-
ponent than pure key indicators for comparisons. Key figures hold the danger of being viewed
isolated and not sufficiently interpreted but still are used for rankings and thus lose all acceptance
among those affected, especially in the highly differentiated scientific systems like a university.
The selection of the criteria, but also the method of collecting data can result in different rankings.
Rankings should therefore be treated with caution. They can be misinterpreted, which is why the
scientific community is looking for better quality methods of performance appraisal.47
As mentioned above, benchmarking is first and foremost a qualitative process that needs to be
stimulated, driven and desired by the participants themselves. A procedure must be chosen that
answers different questions before the project is started.
For now, it is important to be clear about the goal of a benchmarking project, e.g. on which ques-
tions the benchmarking should give answers. Possible topics include dealing with a reduction of
resources (savings projects), optimizing processes (increasing efficiency and effectiveness) or im-
proving the quality of university performance. If people and stakeholders are able to focus on a
46 cf. Schedler/Proeller (2000), p. 163 et seq.

47 cf. Schedler, S. (2003), p. 30.

common goal, then benchmarking as an impetus for organizational learning has a good chance of
success.48
5.2.1. Procedure of Benchmarking
The actual benchmarking process starts with an analysis of the own situation:
Þ Where do we stand?
In relation to the objectives of the benchmarking project, the own organization is examined and
jointly a determination is made about where a university sees its strengths and weaknesses. This is
inevitable because comparisons with others can only be fruitfully made if one's own situation is
analyzed and understood.
In a next step, the following question must be answered:

Þ Where can best practices or successful practices be found?
In this phase, benchmarking actually relies on ranked comparisons of selected metrics. However,
such information is generally not disclosed to the public, but remains within the project team. De-
pending on the criterion, different partner universities can be determined for different elements if
they show particularly successful performances in certain areas.
Þ By which method is a comparison possible?

As a rule, the organizations are so different to distinguish themselves by specific differences, but
after good research and consideration, a meaningful comparison is quite feasible.
The most important question in benchmarking concerns learning:

Þ How can one learn from the successful ones?
Business administration provides a variety of methods, from process/activity analysis to quantita-
tive and qualitative methods of information exchange. Qualitative learning processes can, for ex-
ample, include an exchange of knowledge in workshops. This usually has positive effects, because
not only the learning of the best is in the foreground, but often the general exchange of experience
leads to a positive attitude towards the whole project.
After this phase of exchange, the universities are faced with the challenge of implementing what
they have learned in their own specific environment. The peculiarities of the university must be
48 cf. Schedler, S. (2003), p. 30 et seq.

considered, if necessary, training and further education should be provided and persuasion of the
members of the university needs to be paid attention to. The desired solution is to be compared
with the goals of the university and to be coordinated with them.49
5.2.2. Indicators for Benchmarking
The phase of searching for suitable benchmarking partners or successful practices relies on quan-
titative indicators within the university landscape. In order to achieve meaningful structuring, a
procedural model of university work is used. Schedler (2003) uses an input-process-performance-
impact-model and defines appropriate indicators for each of these steps:
Figure 2: Indicators for Benchmarking50
Input indicators refer to the resources that a university has to work with, such as financial resources,
human resources, infrastructure and other resources. They provide information about the basis of
a university, which is essential in later comparisons with the results.
49 cf. Schedler, S. (2003), p. 31.

50 Own representation based on Schedler, S. (2003), p. 35.

Process indicators ideally focus on the core processes of university work. These core processes
must be identified by each university itself.
Performance indicators refer to the activities that directly come from the university. Generally,
teaching, research, services and education are differentiated. Often these are quantitative indicators
because they indicate performance in terms of scale and quality, but not their effect.
Impact indicators refer to the impact and effect of university activities. In most cases, these are the
most difficult to raise and contain a great deal of room for interpretation.51
5.2.3. Success factors of Benchmarking
For Benchmarking to be a success, certain conditions are necessary:52
• First, there must be clarity about one's own goals. This applies both to the objectives of
benchmarking and to the goals of the university.
• It is also important to have clarity about one's own achievements, especially about the tasks
of the university. This applies all the more, if own activities and their effects are systemat-
ically assessed, and if the assessment results are consistently incorporated as a basis for
decision-making. Transparency in the area of performance must be established in order to
be able to make comparisons later.
• A basic requirement of benchmarking, which refers to quality of university performance, is
a clear idea of what is actually good quality of university performance. Different priorities
can be set. Some universities focus on research, others on good teaching or on a broad range
of research, teaching, training and service.
• Last but not least, benchmarking also needs a university culture that allows new ideas and
solutions. Often not only the terminology changes, but also conceptual ideas behind organ-
izational learning.
51 cf. Schedler, S. (2003), p. 35.

52 cf. Schedler, S. (2003), p. 37.

6. Designs / Frameworks of MCS
6.1. Simons’ Levers of Control
A well-known proposal for the design of MCS comes from Simons (1994). He assumes that the
implementation of four Levers of Control is necessary, which are not applied individually but to-
gether form an overall system.53 The following figure shows the four Levers of Control by Simons:
Figure 3: Levers of Control - Simons54
The belief systems should be used to inspire and search for new opportunities whereas the boundary
systems set limits on opportunity-seeking behavior. The diagnostic systems focus on motivation,
monitoring and rewarding achievements of special goals and interactive controls stimulate the or-
ganizational learning and the emerge of new ideas and strategies. Two of the levers – the belief
systems and the interactive control systems – should be noticed as positive, inspirational forces.
53 cf. Simons, R. (1994), p. 6.

54 Simons, R. (1994), p. 7.

The other two levers – the boundary systems and the diagnostic control systems – are used for
creating constraints and ensuring compliance with orders.55
Especially the area of "interactive control systems" plays an essential role in the context of univer-
sities, since this term describes a formal process, which questions the previous control mechanisms
of an organization as well as the entire model of an organization. Above all, the strategy of the
organization is questioned, and the weaknesses are revealed.56
The critical discussion and reflection on the relationships between supervisors and employees, the
process of decision-making and the regular review of the applied control systems are also in the
field of interactive controls.57
The relevance of control mechanisms for controlling research institutions through e.g. performance
measures was studied by Osterloh (2010). Controls can therefore take the form of output, process
or input controls. Diagnostic controls would be output measures – those are related to the use of
output performance indicators like e.g. citations, number of published articles, number of PhD
completions and are used to represent the output of researchers in universities. Those output
measures are easily understood by external stakeholders like the government or funding bodies.
These output measures are used as diagnostic controls and show how well an organization or indi-
vidual researchers have performed. However, the simply use of output measures can lead to nega-
tive behavior and Osterloh advocates that the use of belief systems like the socialization of peers
and giving autonomy to academics should be the preferred means of controlling in research areas.58
6.2. The design of Merchant/Van der Stede
In designing a framework, the focus of Merchant/Van der Stede was primarily set on the behavior
of employees. In the background, the corporate goals and the corporate strategy become important
because the behavior of the employees should be conducive to these goals and strategies. The ben-
efit of implementing MCS so then should be an increased probability that the organization’s ob-
jectives will be achieved. The authors assume that there can be three main problems:
1) Lack of direction: Employees are not sure about what is required of them / what the organ-
ization wants from them.
55 cf. Simons, R. (1994), p. 7 et seq.

56 cf. Davila et al. (2009), p. 288.
57 cf. Simons (1994), p. 172.
58 cf. Osterloh, M. (2010), p. 277 et seq.

2) Lack of motivation: The employees know about their goals, but they do not act in an desir-
able way. There can be several reasons of motivational problems like for example a mis-
match of goals – the employee’s goals do not coincide with organizational goals.
3) Personal limitations: Employees know the organization’s expectations and they are also
highly motivated but still unable to perform in the desired way. Those limitations can be
person-specific through for example a lack of training or work experience.59
Some of these control problems can be prevented, for example, by automation or elimination, but
for control issues that cannot be prevented, managers must introduce control mechanisms.60 How-
ever, it is important to weigh the costs and benefits. Merchant and Van der Stede mention four
MCS that can be used to prevent control problems:
Þ result controls
Þ action controls
Þ personal controls
Þ cultural controls
All these forms of control have advantages and disadvantages and can be used tightly or more
softly and can be combined differently. The tighter the controls are set, the more rigorously these
factors are monitored and controlled. However, MCS can never be definitively defined and used,
but must always be adapted to the surrounding conditions and the company.61
Through ongoing trends towards managerialism and globalization, universities differ in many ways
from companies or organizations in the private market. Universities have to deal with a wide range
of influencing factors from external and internal stakeholders like e.g. external political pressures
and the academic leadership through managers, increasing accountability for more transparency,
etc. Those influencing factors make it challenging to design control systems which fit the structural
complexity of universities as universities have several types and levels of units (departments, in-
stitutions, administrations, etc.), different types of services (research, teaching, public engage-
ments, etc.) in various forms (undergraduate, postgraduate, research-oriented, collaborative re-
search projects) in different modes and various locations. The most challenging task is the meas-
urement of outputs of universities as e.g. the quality of classes, programs, courses, international
collaborations, etc. are difficult to measure. This context also contributes to the fact of different
climates between universities and business units in the private sector. This in turn means that other
controls have to be developed and applied in all areas.62
59 cf. Merchant, K. A./Van der Stede, W. A. (2012), p. 9 et seqq.

60 cf. Merchant, K. A./Van der Stede, W. A. (2012), p. 12 et seq.
61 cf. Merchant, K. A./Van der Stede, W. A. (2012), p. 120 et seq.
62 cf. Bobe, B. J./Taylor, D. W. (2010), p. 6.

6.3. The design of Malmi / Brown
Malmi / Brown consider MCS as a package and emphasize the importance of considering them as
an overall-system instead of discussing the individual systems. In their design five types of controls
are part of the package: planning, cybernetic, reward and compensation, administrative and cultural
controls.63
Figure 4: MCS as a package - Malmi / Brown64
The phase of planning should help to set out the goals of an organization and direct the effort and
behavior towards these goals. The planning process also provides the standards to be achieved and
clarifies what is expected of organizations’ members. Furthermore, planning can be divided into
action planning for the immediate future and a long-range planning, where more strategic goals for
the medium and long run can be established.65
The cybernetic system should support managers in the processes of decision-making through
providing information about unwanted variances and possible underlying behavioral reasons that
influenced those variances. Four basic cybernetic systems can be identified: budgets, financial
measures, non-financial measures and hybrids that contain financial and non-financial measures
(e.g. Balanced Scorecard).66
The reward and compensation systems try to increase the goal congruence between individuals and
the organization in order to focus on motivating the individuals for higher performance outcomes.67
63 cf. Malmi, T./Brown, D. A. (2008), p. 291.

64 Malmi, T./Brown, D. A. (2008), p. 291.
66 cf. Malmi, T./Brown, D. A. (2008), p. 292 et seq.

Administrative control systems help to direct the behavior of individuals by organizing the moni-
toring, accountability specifications, processes of how tasks should be performed or not performed.
Administrative control systems are divided into three areas: governance structure (board structure,
management teams), organization structure (structural type of organization) and policies and pro-
cedures (bureaucratic approach for specifying processes and behavior within an organization).68
Culture can also be used as a control system when it is used to regulate the behavior of individuals.
There are three aspects of cultural control which contain clans (subcultures, microcultures), values
(value statements) and symbols (visible expressions).69
In the university context cybernetic controls would for example include a financial dimension like
costs per student, income by funding bodies, material costs, etc. Probably a high share of fixed
costs shapes the universities’ financial context. Furthermore, action planning would include to in-
crease the number of publications or for long-range planning to increase e.g. the quality of educa-
tion, the satisfaction of students, etc. The administrative controls would have to consider the dif-
ferent levels and areas of universities. A possible task could be the fair allocation of resources
between teaching and research in different departments. Reward and compensation systems have
to be connected to specific measures like e.g. the number of publications, citations, etc. in research.
Cultural controls and values must be adapted to the structure of universities and therefore e.g. con-
sider a more autonomous atmosphere in research areas.70
7. Management of universities
In the least years and decades there have been some major changes in the management of univer-
sities worldwide. Reasons for those changes are globalization, internationalization, harmonization
of systems, marketisation and managerialism and NPM. Due to the globalization, European sys-
tems e.g. try to adapt to the systems of the United States or the Anglo-Saxon area. One of the main
goals in Europe is and was widening the access to higher education systems and create and expand
diversity.
Regarding internationalization, Europe created a European space of higher education through the
so-called “Bologna process” that concerned mainly changes in teaching functions and higher edu-
cation systems. Through the Bologna process the systems of higher education became more homo-
geneous but at the same time the competition between universities increased.71 NPM led to reforms

70 cf. Stefan, A.-M. (2015), p. 507.
71 cf. Sporn, B. (2003), p. 98.

in the public sector in general and universities are facing higher demands of efficiency, effective-
ness and accountability which requires the introduction of new mechanisms and new MCS.
7.1. New Public Management
NPM is a wide term for the worldwide reform movement of modernization of administrations.
Characteristics of NPM reforms are changes in the controls of input and output.72
The concept encompasses four internationally important areas of reform: functions and roles of the
state, (internal) administrative management, market and competition orientation, democratization
and citizen orientation.73 However, NPM is not a complete set of measure but there are many pro-
posals for improving the functioning of public administrations in all areas.
Services provided by universities are services that are "produced" in universities (universities as a
special form of enterprises) and those products (outputs) require the use of resources (inputs).
The required resources e.g. personal, financial and time resources, prove to be scarce from an eco-
nomic point of view. It therefore makes sense to introduce management techniques in the university
sector. On the one hand, they aim to enable the most economical use of scarce resources for the
provision of desired services (minimum perspective). On the other hand, with given resources, the
highest possible level of the services realized should be achieved (maximum perspective). This
two-fold goal has been established in business economics as an economic principle for many dec-
ades and is usually subsumed in new management ideas under the principle of efficiency, i.e. to
make the ratio between the outputs and the inputs used as optimal as possible. At the same time,
these resources must be used as efficiently - or productively - as possible. In concrete terms, this
means for the university sector that it is desirable from a business as well as an economic point of
view to steer investments with long-term intended results (outputs, but also outcomes) in research
and teaching as well as the "Third Mission" of universities towards an increased and/or optimized
efficiency of using scarce resources.
Accordingly, universities are increasingly orienting themselves to the thinking and acting patterns
of NPM, in particular their orientation towards efficiency criteria.74
72 cf. Schedler, K./Proeller, I. (2006), p. 5.

73 cf. KGSt (2006), p. 3.
74 cf. Zelewski et al. (2017), p. 558 et seq.

7.2. Bologna Process
Although this thesis refers to MCS in universities worldwide a quite large number of articles was
published within universities in Europe and some of the authors of these articles mentioned the
Bologna Process. Therefore, this Chapter should provide an overview and give a short explanation
about this process in Europe.
One of the goals of the Bologna Process through the introduction of new governance structures in
the European higher education landscape was the new system of accreditation. The politically de-
sired harmonization of curriculum structures and degrees, as well as the concerted efforts to stim-
ulate competition among European universities - but also with other international educational es-
tablishments of tertiary education - necessitate the establishment of at least similar quality control
and comparability systems. The accreditation of study programs is traditionally the most important
pillar of a comprehensive system of quality assurance in higher education.
Even in higher education systems, such as those of the USA or the United Kingdom, such classic
forms of accreditation are common: there, state recognition does not decide whether a degree pro-
gram may be offered, but about the equally important question whether those study offers can claim
financial aid by the state. The Bologna Process was also linked to NPM, as a central element of the
NPM in the higher education sector is the withdrawal of direct state regulation in favor of a dele-
gation to independent agencies. Such quality assurance agencies carry out accreditations of degree
programs at individual universities in intervals of four to seven years. These procedures are mostly
based on a peer-review-based evaluation of the study program submitted for accreditation. In order
to master such an evaluation successfully, a university needs an assertive management with the
ability to define, document and control also university-internal quality standards - thus a strong
administrative self-control.75
7.3. Intellectual Capital
Intellectual capital, referring to universities, means all the intangible, non-physical assets of an
organization such as processes, innovation, patents, implicit knowledge of members and their abil-
ities, talents and competencies, recognition of society, networks of contacts, collaborations, etc.
Intellectual capital is basically divided into three components, which are linked together:
• Human capital: Human capital is the sum of all explicit and implicit knowledge of the staff
of a university (teachers, researchers, managers, administrators, staff). This explicit and
75 cf. Lange, S. (2008), p. 244 et seq.

implicit knowledge was acquired through formal or non-formal education and can be re-
freshed.
• Structural capital: Structural capital is the explicit knowledge that is related to the internal
processes of knowledge dissemination, communication, management of scientific personal
and technical knowledge in a university.
Structural capital is divided once again into:
Þ Organizational Capital: This refers to the environment derived from interactions
between research, management, organizational processes, organizational rou-
tines, corporate culture and values, internal procedures, etc.
Þ Technological Capital: refers to the technological resources available at a univer-
sity, such as bibliographic and documentary resources, archives, technical devel-
opments, patents, licenses, etc.
• Relational Capital: Relational Capital is considered to be an extensive collection of all eco-

nomic, political and institutional relationships developed and maintained between the uni-
versity and non-academic partners, e.g. relationships with non-profit organizations, govern-
ment, society, companies, etc.
In order for a university to maintain its contacts and connections with the environment, in order to
ensure and maintain the transparency of information, and to satisfy the information needs of all
stakeholders, it is advisable to present information on intellectual capital.76
In organizations that are largely publicly funded, there are huge demands for transparency and
disclosure of the use of public money. This question of disclosing the social and economic out-
comes of a university is also referred to as public accountability. The politics and also the manage-
ment of universities must therefore implement new management and reporting systems in univer-
sities and in the meantime also effectively manage the resources, since these forms the basis for
the achievements of universities.77
Private companies have already begun to introduce intellectual capital management and reporting
systems because the information provided is from particular importance to managers and external
stakeholders to make decisions or make investments, for example. In recent years, IC reporting has
also been introduced at some innovative public and private universities. Especially universities are
76 cf. Ramirez et al. (2015), p. 3022 et seq.

77 cf. Leitner, K. (2004), p. 126.

challenged by an increased demand for effectiveness, efficiency and accountability, which sup-
ported the introduction of a new management system and reporting system.78
In Austria, the Austrian Parliament decided in 2002 that universities are required to publish IC
reports, whereby the new law sets out the content and structure of the IC reports.79
As with all measurement and management systems that work with knowledge-based processes and
data, methodological issues make it difficult to measure 'soft', non-physical outputs. Therefore, it
would be important to consider and apply qualitative methods when collecting the data for the IC
reports.80
8. Theoretical approaches
The theoretical approaches provide insights into various theories and theoretical elaborations,
which are incorporated in the fields of MCS and universities.
8.1. Contingency theory
The contingency theory predicates that there is no universally applicable MCS, but those systems
have to be chosen after checking the surrounding specifications of an organization. The goals and
strategies of an organization are central factors that must be taken into account when choosing the
appropriate MCS.81
The theory has its foundation in the organizational theory and it has shaped traditional MCS for
decades. A lot of empirical studies have been carried out in entrepreneur enterprises which see their
theoretical frame of reference in this theory. One of the main advantages of the contingency theory
lays in the understanding that exogenous factors like the environment, technology and structure
implicate to the design of MCS. But also disadvantages should be mentioned: exogenous factors
are often static in its nature and they do not lead to predictions for the future of an organizations.
Consequently, the design of the MCS will always be past-orientated as it follows the development
of exogenous factors and if the design is not appropriate this can lead to underperformance in an
organization.82 This makes it important to understand which starting situations affect the design of
MCS to plan the design of the MCS accordingly. However, there is an important balance to be
78 cf. Leitner, K. (2004), p. 129.

79 cf. UG (2002), §13.
80 cf. Leitner, K. (2004), p. 138.
81 cf. Otley, D. (1999), p. 367.
82 cf. Chenhall, R. H. (2003), p. 157.

found between fostering creativity and innovation and regulating and controlling processes. For
the development of an appropriate, well-developed MCS a combination of internal and external
factors needs to be taken into account.
8.2. Principal-Agency-Theory
The starting point of the Principal-Agency-Theory is the essay "The Economic Theory of Agency:
The Principal's Problem" of Ross in 1973. Ross represents in his essay the relationships that are
contracted, if at least a principal instructs at least one agent to act in his interest.83
Similarly, Jensen and Meckling define such a relationship as a contract between one (principal)
who engages another person (agent) to perform with entrusted delegation.84
This approach seeks optimal contract terms for the agent to realize the interests of the principal. It
opens up a broad field of application because countless relationships have such characteristics.85
Overall, Principal-Agency-Theory is a universal model for describing and explaining action in del-
egation relationships. Central to the theory are two assumptions:
1. Both, principal and agent, seek to maximize individual benefit86

2. By performing the activity, the agent has an information advantage over the principal87
An objective of the principal may be to sanction the agent unless the delegated activity fulfills the
expected benefit. An essential feature for the evaluation of the relationship and the success or fail-
ure of the order fulfillment are the resulting costs. Those costs are called ‘agency costs’ and they
are understood to mean all costs that arise from deviations from the fictitious ideal state of a perfect
fulfillment of the contract.88
1. Agreement costs of contract negotiation and design.

2. Control and control costs of the principal towards the agent.
3. Warranty costs of the agent to guarantee to act in the interests of the principal.
4. Residual costs arise from welfare losses if the agent misses the possible maximum benefit
for the principal.
83 cf. Ross, S. (1973), p. 134.

84 cf. Jensen, M. C./Meckling, W. H. (1976), p. 308.
85 cf. Saam, N. J. (2002), p. 6.
86 cf. Buxmann, P. et al. (2011), p. 57.
87 cf. Mathissen, M. (2009), p. 19.
88 cf. Kieser, A./Evers, M. (2006), p. 262.

The aim of this branch of research is therefore to optimize such contractual relationships and rela-
tionship constellations. As the definitions and explanations make clear, the perspective is broad. It
is important that a contract does not necessarily have to be real.
Priority is given to two issues:
1. An informational problem for the principal who cannot and will not always observe the
execution of the delegated task, and
2. a distribution problem of risk between principal and agent. Where the agent is rather risk-
averse and the principal rather risk-neutral.89
There are at least two serious problems in transferring the Principal-Agency-Theory to higher ed-
ucation. First, the delineation of the relevant principals and agents in the field of higher education
is difficult; secondly, the objectives of the principal himself are far less clear than in the case of
private companies.
Ambiguities in the distribution of competences and the goals of universities are the main problems.
However, the theory makes it possible to formulate recommendations for improved incentive de-
sign.90
There is a multitude of actors either in higher education or at least with interests in this field. In
addition to the professors, also academic staff and other employees work at the universities. The
students are an important group at the universities as well, and their parents also have legitimate
claims. Above the professors there are deans, university administrations, ministries and finally gov-
ernments. In order to be able to carry out a meaningful analysis, scientists (professors, assistants
and employees) are defined as agents and the government as principal.
The case that agents have preferences for goal achievement which lie in intrinsic motivation, e.g.
the need to research or teach well, has not yet been analyzed sufficiently.
The intrinsic motivation can be displaced by too strong material incentives. Non-monetary incen-
tives make sense to keep employees in research and teaching interested and motivated.
In order to achieve the goals, suitable individual incentives must be set, which must be linked to
clear decision-making and responsibility structures.
The Principal-Agency-Theory is relevant for universities, since it is assumed that research achieve-
ments can be more easily determined by publication measures than teaching achievements. There-
fore, if research achievements are rewarded much more than those in education, then it is no wonder
that many university staff focus on research and neglect teaching.91
89 cf. Saam, N. J. (2002), p. 8.

90 cf. Dilger, A. (2001), p. 133 et seqq.
91 cf. Dilger, A. (2001), p. 145.

In case of this thesis the focus is on the relationship between the government and the university,
whereas the government represents the principal and the university represents the agent. This rela-
tion will be described in a more detailed way in Chapter 9.6 and Chapter 9.8 as many authors of
analyzed articles examined and described this relation. The theory could as well be applied for
relations in-between the internal stakeholders at universities like between rector and professors or
between universities and collaboration partners e.g. private companies. The Principal-Agency-The-
ory is applicable in almost all relations with interchanges. In case of this thesis, the objectives of
the principal – which is the government – are related with the demands of the society in general.
As this thesis deals with universities which are publicly funded, those universities are confronted
with an increased demand for transparency regarding the use / application of financial resources
and the outputs achieved with those funds. The disclosure of social and economic outcomes should
satisfy the call for public accountability. The government and the citizens want to know what those
public funds are used for and which outcomes are achieved through it. A demand for more trans-
parency is observed which also requires the introduction of new management (control) systems and
reporting systems.92 Subsequently, the Principal-Agency-Theory helps to understand the relation
between government and universities and as well provides justifications for the requirement of
changes and the introduction of new systems.
8.3. Stakeholder theory
The stakeholder theory was first discussed by Freeman in the 1980s and is used today in many
different disciplines. For the first time, Freeman's concept incorporates external influences that
could influence a company or organization. Before, the focus was increasingly on investors, but
Freeman explained that other stakeholders have an influence on an organization. The term 'stake-
holder' has been defined and set for this context. The stakeholder theory deals with the structure of
companies and tries to analyze all interest groups inside and outside an organization.93
The theory is important for this thesis, because universities have a large number of interest groups.
Stakeholders can be grouped into internal and external groups, with internal stakeholders including
university management, students and staff, and external stakeholders, such as government, parents,
business partners, competitors, communities, sponsors, industries, etc.
Influencing forces do not always come from management levels in the university itself, but the
environment and organization of universities is characterized by many more target groups.
92 cf. Leitner, K. (2004), p. 129 et seq.

93 cf. Freeman, R. E. et al. (2010), p. 24 et seqq.

However, this theory not only explains the splitting of the results of the meta-analysis into external
and internal factors, but also serves as an essential basis for explanations of MCS in general.
In order to embed a highly developed MCS in the university context, all stakeholders have to be
considered.
The following graphic should represent a division into internal and external stakeholders in the
university context:
Figure 5: Internal and external university stakeholders94
8.4. Self-Determination-Theory
The SDT has its origin in research fields of the effects that extrinsic rewards have on intrinsic
motivation. The starting point for the development of SDT was the observation that, contrary to
general expectations at that time, the motivation for activities that are interesting in itself is often
not increased by additional incentives or rewards, but rather goes back to the opposite.95 Monetary
rewards and incentive systems can reduce this intrinsic motivation.
94 cf. Matkovic, P. et al. (2014), p. 2273.

95 cf. Deci, E./Ryan, R. M. (1985), p. 5-6.

According to SDT, there are three basic psychological needs whose satisfaction is relevant to ef-
fective behavior and mental health. These are competence, autonomy and social integration. Com-
petence is understood to mean the feeling of being able to effectively act on the things that are
considered important in each case and to achieve the desired results accordingly. Autonomy refers
to a sense of voluntarism that can accompany any behavior. Last, social inclusion not only refers
to the importance of other persons in the own life, but also the considering the importance one
person has for others.96
The way in which satisfaction of these basic needs is possible depends to a large extent on the value
system acquired in the respective socio-cultural context.97
In addition to the motivation for a single task or for a specific area, the interests of the theory reside
also in the motivational factors of the individual personality. On the one hand, these are the causal
attributions, which indicate where a person generally sees the cause of their own behavior, and thus
describe the general extent of self-determined behavior of this person.
On the other hand, these are the behavioral goals or motives of the person, which are still subdi-
vided into extrinsic motives, such as material wealth or social recognition, and intrinsic, such as
group affiliation or personality development.98
There is a recurrent mentioning of intrinsic motivation of the employees at universities and an
academic freedom and autonomy in the literature (Egginton 2010, Kallio/Kallio 2014). Academic
freedom and autonomy mean that the working environment of researchers in universities has been
little controlled for a relatively long time. But due to NPM reforms the introduction of new MCS
was required, such as employee PMS and auditing of publications. Academic staff and especially
researchers feel deprived of their freedom and autonomy by introducing those controls.
Areas of self-determination of universities in connection with the state are quite realistic, but there
has always to be considered, that public universities are dependent of the state as the state is re-
sponsible for funding them. Funding through university-industry partnerships and projects or
through patents are usually not sufficient.
96 cf. Deci, E./Ryan, R. M. (2000), p. 74.

97 cf. Deci, E./Ryan, R. M. (2000), p. 75.
98 cf. Deci, E./Ryan, R. M. (2008), p. 183.

8.5. Connection of theoretical approaches
The following graphic shows the interrelations between the theoretical approaches in the university
context:
Figure 6: Connection of theoretical approaches
The middle of the graphic shows a building which should stand for the university. The green area
shows the internal stakeholders of a university. Rector, deans, governing board, professors, stu-
dents, employees, etc. belong to this group.
This area addresses the first theoretical approach of this thesis - the Stakeholder Theory. The green
area is surrounded by the yellow area which represents the special climate within universities
through the SDT. The yellow area should represent a climate of autonomous thinking and intrinsic
motivation of universities’ employees. The blue area shows the external stakeholders of a univer-
sity e.g. government, parents, business partners, competitors, communities, sponsors, industries,
etc. This area refers again to the Stakeholder Theory. At the bottom, in the right corner of this
graphic, there is a white arrow which connects government with the university – this relation deals
with the Principal-Agency-Theory. The theory could as well be applied for relations in-between
other stakeholders at universities, for example between rector and professors but in case of this

thesis the focus is on the relationship between the government and the university as this relation
was examined and described by various authors of analyzed articles.
Overall, on the outside there is the red area which represents the contingency theory. This theory
is located on the very outside of the graphic as it should frame all other theories. There is no uni-
versally applicable management control system, which means every university needs its own spe-
cific control systems consisting of a combination of its internal and external factors.

9. Meta-analysis
This diploma thesis is based on a meta-analysis connected to a systematic literature review. Due to
the objective of this diploma thesis, the methodology of the meta-analysis was selected because
through analyzing existing literature there can be made a conclusion and an observation about the
current state of MCS in universities. As a result, already collected data can be analyzed and the
data will be summarized in categories. This gives an overview of the current state of research and
draws conclusions about research deficits.
9.1. Methods
The systematic review of the literature and the associated method, the meta-analysis, has been de-
veloped in recent decades and now plays an important role in evidence-based practices.99
According to Tranfield et al. (2003), a systematic literature review consists of five main steps:
(1) determination of the state of research,

(2) selection of studies,
(3) quality assessment of the studies,
(4) data extraction and monitoring process and
(5) Data synthesis and reporting.100
(1) In the first phase, key words or topic areas, over-terminology, technical terms and synonyms
were identified, which can be used for the search by means of a search string and serve to answer
the research questions. These were then gradually included in a search string; whereby first very
general terms formed the search string and then the search string was more and more detailed for-
mulated to increase the number of hits in the databases. In the more detailed formulation of the
search strings, keywords from the individual MCS frameworks were also considered. The search
strings used for the identification of articles are in the appendix of this diploma thesis.
The search for adequate contributions was done by searching in databases.
The following databases were researched:
• Web of Science
• EbscoHost
• Scopus
99 cf. Tranfield et al. (2003), p. 209.

100 cf. Tranfield et al. (2003), p. 214.

The search string was applied to titles and abstracts of academic journals in the previously men-
tioned databases. MCS in universities is considered in many different fields, so it was necessary to
look for publications across several disciplines like management, accounting, finance, higher edu-
cation, human relations, social studies, public administration, leadership, organizational studies and
similar fields.
Pittaway et al. (2004) describe this search of data from a range of disciplines as common to sys-
tematic literature reviews.101 Only publications in English were considered. As a preliminary set
417 articles could have been identified within a timeframe from 1979 to 2018.
Articles
Keyword added
Phase Subphase Removed based on
based hits to sam-
ple
Title /Ab- Full
Duplicates Ranking
stract text
Database
Overall 417 -283 -10 -46 -28 50
analysis
EbscoHost 55 -39 -3 -0 -6 (7)
Web of Sci-
252 -189 -4 -17 -11 (31)
ence
Scopus 110 -55 -3 -29 -11 (12)
Reference
3
analysis
Expert
recommen- 4
dation
Total 57
Table 1: Selection of articles
(2) Based on inclusion and exclusion criteria, the core articles were selected for analysis. Thus,
only those articles were used that met the inclusion criteria and were not excluded by the exclusion
criteria. The following table contains inclusion or exclusion criteria in terms of language, study
design, publication specifics, publication date, content and ranking:
101 cf. Pittaway et al. (2004), p. 140.

Inclusion and Exclusion criteria
Language • English
• academic journals, articles, peer-reviewed
Study design
(Business Premier)
• Inclusion: articles out of academic journals in
the topic areas of MCS and Universities, Control
Systems, Higher Education, Management of
Publication specifics Tertiary Education, Performance Measurement
and Management in Universities
• Exclusion: Monographs, compilations, proto-
cols, etc.
• Inclusion: 1960-2018, for making sure to in-
clude several theories, frameworks and studies
Date of publication of MCS and developments in the education sec-
tor
• Exclusion: Articles before 1960
• Inclusion: Articles that address the manage-
ment and control systems in universities as well
as their implementation, execution, governance,
Content advantages and disadvantages, difficulties and
related peculiarities
• Exclusion: Articles which focus singly on MCS
or singly on educational institutions
• Inclusion: Articles from journals which are
ranked according to VHB, ABS or AJG. Rank-
ing level though did not lead to further exclu-
Ranking
sion.
• Exclusion: Articles in journals that are not
VHB, AJG or ABS ranked.
Table 2: Inclusion and exclusion criteria

Through removing duplicates and applying those inclusion and exclusion criteria to abstracts and
full texts the total amount of articles led to 50 publications. The references of those articles were
screened to find further articles which meet the above criteria which resulted in 3 additional publi-
cations. Finally, expert recommendations led to another 4 additional articles. Thus, the final set of
articles contained 57 publications.
(3) For the assessment of study quality the publications were not further investigated as one criteria
named “Ranking” in the inclusion and exclusion table was used for the quality screening during
the data selection phase.
(4) All selected publications are listed in the following grid (Chapter 9.2) which includes basic
information of the articles like author, title and publication year and more specific information like
method, details, geographical location, etc. This grid serves as an overview but as well as a basis
for the following data synthesis.
(5) The data synthesis is based on a descriptive and thematic analysis of the selected articles to
answer the research questions. For data synthesis, four thematic clusters have been created by
which the articles have been categorized. Consequently, in the phase of data synthesis, these the-
matic clusters contain the contents of the articles. Also included in the data extraction table is a
column headed "Cluster," which indicates which article can be attributed to which cluster. The
clusters are further explained in the next following chapter after the data extraction table (Chapter
9.3).

9.2. Grid of article results
The following table lists the 57 selected articles from the respective journals. These articles were identified by the procedure described in Chapter 4.1 and
were used to answer the research questions. The table also includes a column "Cluster" in which the articles are assigned to clusters which are described
in Chapter 9.3.
Year of
Author Publi- Title Journal Method Country Geographic location MCS-Focus Coding
cation
Value-based perfor-
mance excellence
measurement for Quality / Quan- Quantitative performance excel-
Ab Hamid, M. R. et al. 2013 Malaysia Asia IE
higher education in- tity survey lence measurement
stitution: instru-
ment validation
The role of infor-
mation asymmetry
The Journal of research collabora-
in the market for Literature re-
Abramo, G. et al. 2011 Technology Italy Europe tions: industry and EE
university–industry view
Transfer university
research collabora-
tion
Sustainability re-
Sustainability
porting and perfor- performance man-
Accounting,
mance management Conceptual agement and sus-
Adams, C. A. 2013 Management Global Global
in universities: framework tainability report-
and Policy Jour-
Challenges and ing
nal
benefits IE

MCS and research
Accounting,
management in uni- development of
Agyemang, G. / Broadbent, Auditing / Ac- Literature re-
2015 versities: An empir- UK Europe MCS, research
J. countability view
ical and conceptual management
Journal
exploration IE, EE
International
Performance meas-
Journal of development of
urement maturity in Conceptual
Alach, Z. 2017 Productivity and New Zealand Oceania performance meas-
a national set of uni- framework
Performance urement maturity
versities.
Management IE
International
The use of perfor- development of
Journal of Pub- Conceptual
Alach, Z. 2017 mance measure- New Zealand Oceania performance meas-
lic Sector Man- framework
ment in universities urement maturity
agement IE
A Theory of aca-
demic interdiscipli-
research project
nary research per- Management Conceptual
Birnbaum, P. H. 1979 USA North America performance, envi-
formance: a contin- Science framework
ronmental factors
gency and path
analysis approach IE, EE
How to stimulate
the continued use of
ICT in higher edu-
Computers in
cation: Integrating Quantitative information and
Bøe, T. et al. 2015 Human Behav- Norway Europe
Information Sys- survey communication
ior
tems Continuance
Theory and agency
theory II
Internal perfor-
mance management internal perfor-
Measuring Busi-
Broad, M. / Goddard, A. 2010 with UK higher ed- Qualitative UK Europe mance manage-
ness Excellence
ucation: An amor- ment
phous system? EI

Analyzing societal
regulatory control Accounting,
systems with spe- Auditing / Ac- Conceptual societal regulatory
Broadbent, J. et al. 2010 England Europe
cific reference to countability framework control systems
higher education in Journal
England EE
Focus on the finger,
overlook the moon:
Journal of
the introduction of management sys-
Higher Educa- Quantitative
Busetti, S. / Dente, B. 2014 performance man- Italy Europe tems in higher edu-
tion Policy / survey
agement in the ad- cation
Management
ministration of Ital-
ian universities II
The adoption of in-
ternal audit as a
Journal of
governance control
Higher Educa-
Christopher, J. 2012 mechanism in Aus- Qualitative Australia Australia internal auditing
tion Policy /
tralian public uni-
Management
versities – views
from the CEOs II
interdependent re-
Interdependencies Journal of Man- lations among
in organization de- agement Ac- Quantitative strategy, structure
Chung, T. K. J. et al. 2009 Australia Australia
sign: a test in uni- counting Re- survey and performance
versities search measurement sys-
tems II

The Measurement,
Evaluation, and
Publication of Per-
formance in Higher
Education: An Public Admin-
Literature re-
Clermont, M. / Dirksen, A. 2016 Analysis of the Che istration Quar- Germany Europe research ranking
view
Research Ranking terly
of Business Schools
in Germany from an
Accounting Per-
spective EI
Rethinking the In-
Issues in Ac-
Cohen, J. R. / Holder-Webb, fluence of Agency Literature re- reward systems in
2006 counting Educa- Global Global
L. L. Theory in the Ac- view research areas
tion
counting Academy II, EI
Performance meas-
implementation of
urement in aca-
Public Money / Qualitative / strategic map
Cugini, A. et al. 2011 demic departments: Italy Europe
Management Case study model to an aca-
the strategy map ap-
demic department
proach II
A DEA methodol-
ogy to evaluate the
impact of infor-
mation asymmetry impact of infor-
on the efficiency of Annals of Oper- Conceptual mation asymmetry
De França, J. M. F. et al. 2010 Brazil South America
not-for-profit or- ations Research framework on organizational
ganizations with an efficiency
application to
higher education in
Brazil EE

The Impact of Insti-
tutional Pressures institutional factors
on Employee PMS British Journal Quantitative Belgium, Nether- associated with im-
Decramer, A. et al. 2012 Europe
in Higher Educa- of Management survey lands plementation of
tion in the Low PMS
Countries II
External pressures
affecting the adop- relationship be-
tion of employee tween external
Personnel Re-
Decramer, A. et al. 2012 performance man- Case Study Belgium Europe pressures and
view
agement in higher adoption of em-
education institu- ployee PMS
tions EI
Do internal controls improving operat-
improve operating Annals of Oper- Quantitative ing efficiency
Duh, R.-R. et al. 2014 Taiwan Asia
efficiency of uni- ations Research survey through internal
versities? controls IE
Introduction of For-
mal Performance
Appraisal of Aca- Educational "hard" and "soft"
Literature re-
demic Staff: The Management management chal-
Egginton, B. E. 2010 view / Case England Europe
Management Chal- Administration / lenges of educa-
Study
lenges Associated Leadership tional institutions
with Effective Im-
plementation II
Dealing with
relationship be-
knowledge in the
Journal of Intel- Multicase tween PMS and
Esposito, V. et al. 2013 Italian public uni- Italy Europe
lectual Capital study knowledge in uni-
versities: The role
versities
of PMS IE

The mediating ef-
fect of service qual- relationship be-
ity and organiza- tween management
tional commitment Journal of Or- Quantitative process alignment,
on the effect of ganizational survey / Con- service quality, or-
Fernandes, S. / Sumardi 2018 Indonesia Asia
management pro- Change Man- ceptual ganizational com-
cess alignment on agement framework mitment and high
higher education educational perfor-
performance in Ma- mance
kassar, Indonesia II
relationship be-
The effect of strate- tween the availabil-
gic knowledge ity and use of IT so-
Journal of
management on the Conceptual lutions for strategic
Fernández-López, S. et al. 2018 Knowledge Spain Europe
universities’ perfor- framework knowledge man-
Management
mance: an empiri- agement and the
cal approach universities’ per-
formance IE
Governance and
Well-being in Aca-
demia: Negative
relationship be-
Consequences of
tween alternative
Applying an British Journal Quantitative
Franco-Santos et al. 2017 UK Europe university govern-
Agency Theory of Management survey
ance practices and
Logic in Higher Ed-
staff well-being
ucation: Govern-
ance and Well-be-
ing in Academia IE, EE
Role of academic
Educational
managers in work- ways to control
Management
Graham, A. T. 2016 load and perfor- Case Study UK Europe workload of aca-
Administration /
mance management demic staff
Leadership
of academic staff IE

Market orientation,
top management
emphasis and per-
Journal of Mar- applicability of
formance within Quantitative
Hammond, K. L. et al. 2006 keting Theory / USA North America market orientation
university schools survey
Practice to higher education
of business: impli-
cations for universi-
ties EE
How can academic
innovation perfor- university-industry
Technological
mance in univer- Quantitative collaboration - UIC
Huang, M. H., / Chen, D. Z. 2017 Forecasting and Taiwan Asia
sity–industry col- survey management mech-
Social Change
laboration be im- anisms
proved? EE
Performance Man-
agement for Aca-
demic Researchers: Review of Pub- effects of com-
Jacobsen, C. B. / Andersen,
2014 How Publication lic Personnel Qualitative Netherlands Europe mand systems in
L. B.
Command Systems Administration universities
Affect Individual
Behavior IE
Managing univer-
sity technology de- effects of organiza-
Conceptual
Johnson, W. H. 2011 velopment using or- Research Policy USA North America tional controls on
framework
ganizational control performance
theory. IE

Performance man-
agement practices
and managed per-
existence and im-
formance: The
Quantitative plementation of
moderating influ- Measuring Busi-
Kagaari, J. R. K. 2011 survey / Uganda Africa performance man-
ence of organiza- ness Excellence
Qualitative agement practices
tional culture and
in universities
climate in public
universities in
Uganda II, EI
stress and pressure
Consequences of International
caused by perfor-
KPIs and perfor- Journal of Edu- Literature re-
Kairuz, T. et al. 2016 Australia Australia mance manage-
mance management cational Man- view
ment in higher edu-
in higher education agement
cation IE
Management-by- how is perfor-
results and performance manage-
Studies in Quantitative
mance measurement understood
Kallio, K.-M. / Kallio, T. J. 2014 Higher Educa- survey / Finland Europe
ment in universities by academics when
tion Qualitative
– implications for forcefully intro-
work motivation duced II
Ethos at stake: Per-
effect of manage-
formance manage- Human Rela- Quantitative
Kallio, K.-M. et al. 2016 Finland Europe ment-by-results on
ment and academic tions survey
work motivation
work in universities IE
Evaluating imple-
evaluation of im-
mentation of strate-
plementation of
gic performance Measuring Busi- Quantitative
Karuhanga, B. N. 2015 Uganda Africa strategic perfor-
management prac- ness Excellence survey
mance manage-
tices in universities
ment practices
in Uganda II

Innovative manage- integrated, innova-
ment model for per- tive model for man-
Quantitative
formance appraisal: Management aging the perfor-
Khoury, G. C. / Analoui, F. 2004 survey / Palestine Asia
the case of the Pal- Research News mance appraisal
Qualitative
estinian public uni- process of full-time
versities faculty members II
The government-
higher education in- examination of
stitution relation- Tertiary Educa- government-uni-
Literature re-
Kivistö, J. 2005 ship: Theoretical tion / Manage- Finland / Europe Europe versity relationship
view
considerations from ment through agency
the perspective of theory
agency theory EE
inter-organiza-
An assessment of
Journal of tional relation-
agency theory as a
Higher Educa- Literature re- ships, illustration
Kivistö, J. 2008 framework for the Finland Europe
tion Policy / view of general prob-
government-uni-
Management lems facing control
versity relationship
and governance EE
The Impact of State different govern-

Governance Struc- ance structures and
tures on Manage- their influence on
Journal of Pol-
ment and Perfor- Literature re- resource allocation,
Knott, J. H. / Payne, A. A. 2004 icy Analysis / USA North America
mance of Public Or- view sources of revenue,
Management
ganizations: A promotion of re-
Study of Higher Ed- search and under-
ucation Institutions graduate education
EI, EE

Quantitative challenges of re-
Research Perfor- Canadian Jour-
survey, Qual- search performance
Manning, L. M. / Barrette, J. 2005 mance Manage- nal of Adminis- Canada North America
itative / Case management in ac-
ment in Academe trative Sciences
Study ademia
II
perceptions of aca-
Human capital loss demic human capi-
Martin-Sardesai, A. / Gut- in an academic per- Journal of Intel- tal towards re-
2018 Case Study Australia Australia
hrie, J. formance measure- lectual Capital search performance
ment system measurement sys-
tems IE
Organizational
how do internal or-
change in an Aus-
The British Ac- ganizational con-
tralian university:
Martin-Sardesai, A. et al. 2017 counting Re- Case Study Australia Australia trol processes
Responses to a re-
view through changes in
search assessment
external demands
exercise EE
The impact of
relationship be-
knowledge man-
Journal of En- tween knowledge
agement on job per-
terprise Infor- Quantitative management
Masa’deh, R. et al. 2017 formance in higher Jordan Asia
mation Manage- survey (KM)process, KM
education: The case
ment performance and
of the University of
job performance
Jordan IE
influence of perfor-
mance manage-
The Influence of ment on govern-
Public Manage-
Melo A. I. et al. 2010 PMS on Key Actors Case Study England Europe ance of university,
ment Review
in Universities academics and on
accountability re-
gimes II, EI

importance of in-
Milianaw Univer-
ternal control and
sity: An Instruc- Issues in Ac-
ethical issues, ef-
Mills, P. A. 1995 tional Case in Inter- counting Educa- Case Study USA North America
fects on manage-
nal Control and tion
ment decision-
Ethics
making II
strategic calcula-
Managing quality tions of academic
in higher education programs, certain
Economics of
systems via mini- Conceptual structural condi-
Mizrahi, S. / Mehrez, A. 2002 Education Re- Israel Asia
mal quality require- framework tions, governmen-
view
ments: signaling tal controlling bod-
and control ies affect quality of
system EE
Goals versus insti- macro perspective
tutions: the devel- on recent changes
Management
opment of perfor- Archival / in performance
Modell, S. 2003 Accounting Re- Sweden Europe
mance measure- Qualitative management re-
search
ment in the Swedish lated to govern-
university sector mental control II, IE
relationship be-
Agency Theory in
tween boards of
the Not-for-Profit Nonprofit and
Quantitative trustees, presiden-
Olson, D. E. 2000 Sector: Its Role at Voluntary Sec- USA North America
survey tial demography
Independent Col- tor Quarterly
and institutional
leges
performance EE

Management con-
trol, uncertainty, relationship be-
Journal of Engi-
and performance in Quantitative tween management
Omta, S. W. F. / De Leeuw, neering and
1997 biomedical research survey / Global Global control, uncertainty
A. C. J Technology
in universities, in- Qualitative and performance in
Management
stitutes and compa- research
nies II
implementation of
Secrets of the bee-
research perfor-
hive: Performance
Human Rela- mance systems,
Sousa, C. A. A. et al. 2010 management in uni- Qualitative Netherlands Europe
tions dealing with mana-
versity research or-
gerial pressures
ganizations
and outside forces EI
The illusion of no
MCS without
control: MCS facil-
Accounting / Fi- threatening the au-
Sutton, N. C. / Brown, D. A. 2016 itating autonomous Case Study Australia Australia
nance tonomous motiva-
motivation in uni-
tion of researchers
versity research
II
impact of BSC on
formation, moni-
Performance man-
Journal of toring and evalua-
agement in UK uni-
Higher Educa- tion of a universi-
Taylor, J. / Baines, C. 2012 versities: imple- Qualitative UK Europe
tion Policy / ty's strategy and
menting the Bal-
Management policy, motivation,
anced Scorecard
implementation
and format
II

Hybridity, coping output-orientation,
mechanisms and increased formali-
academic perfor- Public Admin- Netherlands, Swe- zation, coping of
Teelken, C. 2015 Qualitative Europe
mance manage- istration den, UK academics with
ment: comparing performance man-
three countries agement IE
Performance Man-
judgmental forms
agement in Univer-
European Ac- Quantitative of performance
Ter Bogt, H. J. / Scapens, R. sities: Effects of the
2012 counting Re- survey / Netherlands, UK Europe evaluation, use of
W. Transition to More
view Qualitative more quantitative
Quantitative Meas-
measures
urement Systems EE
The impact of cul-
ture on the use of
performance meas- Management Conceptual design and use of
Vakkuri, J. / Meklin, P. 2003 Finland Europe
urement infor- Decision framework PMS in universities
mation in the uni-
versity setting II
key dilemmas in
Talent management talent and perfor-
Human Re-
in academia: per- Multicase mance manage-
Van den Brink, M. et al. 2013 source Manage- Netherlands Europe
formance systems study ment of universi-
ment Journal
and HRM policies ties, HRM instru-
ments IE
Managerial choice progressive human
and performance in resource manage-
service management practices for
Journal of Oper-
ment—a compari- Quantitative higher employee
Voss, C. et al. 2005 ations Manage- UK Europe
son of private sector survey satisfaction, higher
ment
organizations with service quality and
further education customer satisfac-
colleges tion EE
Table 3: Grid of articles

9.3. Scheme of coding
For the thematic categorization of the contents from the analyzed articles four clusters were formed.
EI External factor - Introduction of MCS

EE External factor - Execution of MCS
II Internal factor – Introduction of MCS
IE Internal factor – execution of MCS
Table 4: Cluster coding
Basically, a distinction was made between external and internal factors that influence the introduc-
tion and execution of MCS. In the course of the analysis of the articles these categories could be
recognized. The individual clusters were delimited as follows: External factors include all relation-
ships and influences of stakeholders, which, according to stakeholder theory, lie outside the com-
pany - in this case outside the university. The internal factors, in contrast, include all relationships
and influences of stakeholders, which, according to stakeholder theory, lie within the company - in
this case within the organization university. Furthermore, a distinction was made between intro-
duction and execution of MCS. Here, contents were counted to the cluster introduction, which refer
to the completely new task of the introduction of a control system including all considerations
around this introduction (e.g. advantages and disadvantages of several control systems, decision
for one control system, introduction process, challenges associated with the introduction process,
etc.). For the execution of MCS contents were counted, which dealt with already introduced control
systems and consequently their execution. These include topics such as the further development of
applied instruments, the determination of the degree of maturity of a control system, etc. It was not
always clear to assign the contents of the articles to only one cluster, since, for example, both the
introduction and the further course of the instrument's execution were dealt with. In these cases,
the articles were assigned to two topic clusters.

9.4. Descriptive analysis of the studied articles
The research findings are presented next und include first some evaluations of publication years,
geographical data and journals.
The following figure shows the years in which the analyzed articles were published. It can be seen
that most of the articles were published between 2010 and 2018, whereas 2010 and 2017 each year
shows six publications.
Published articles per year

7
0
1979 1995 1997 2000 2002 2003 2004 2005 2006 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Figure 7: Published articles sorted by publication year
The following figure shows the distribution of analyzed articles by journal. It can be seen a very
broad distribution of articles on journals from various areas. Four articles are from the Journal of
Higher Education Policy / Management, which is very much in line with the topic of the thesis.
The range of the topics of the journals can also be explained by the systematic process of the liter-
ature analysis, since it is common for the systematic literature review to obtain data from various
disciplines - as already mentioned in the approach of the methodology (Chapter 9.1).

Published articles sorted by journals
Journal of Operations Management
Human Resource Management Journal
Management Decision
European Accounting Review
Public Administration
Accounting & Finance
Journal of Engineering and Technology Management
Nonprofit and Voluntary Sector Quarterly
Management Accounting Research
Economics of Education Review
Public Management Review
Journal of Enterprise Information Management
The British Accounting Review
Canadian Journal of Administrative Sciences
Journal of Policy Analysis & Management
Tertiary Education & Management
Management Research News
Human Relations
Studies in Higher Education
International Journal of Educational Management
Research Policy
Review of Public Personnel Administration
Technological Forecasting and Social Change
Journal of Marketing Theory & Practice
Journal of Knowledge Management
Journal of Organizational Change Management
Journal of Intellectual Capital
Educational Management Administration & Leadership
Personnel Review
British Journal of Management
Annals of Operations Research
Public Money & Management
Issues in Accounting Education
Public Administration Quarterly
Journal of Management Accounting Research
Journal of Higher Education Policy & Management
Measuring Buisness Excellence
Computers in Human Behavior
Management Science
International Journal of Public Sector Management
International Journal of Productivity and…
Accounting, Auditing & Accountability Journal
Sustainability Accounting, Management and Policy…
The Journal of Technology Transfer
Quality & Quantity
0 1 2 3 4 5
Figure 8: Published articles sorted by journals

The pie chart in the figure below shows the geographic location where introduced or executed MCS
have been reported. The majority of articles (51 percent) are concerned with the introduction or
implementation of MCS at universities in Europe. Some publications have been written in a more
general way and are not aimed directly at a university in a particular country or continent - these
articles have been classified as "global" and are also labeled as such in the legend.
Published articles sorted by geographical location
2% 5% 3%
4% 12%
12%
11%
51%
Africa Asia Australia

Europe North America Oceania
South America Global
Figure 9: Published articles sorted by geographical location

9.5. Internal factors impacting the introduction of MCS
Busetti's article (2014) discusses the reform of performance management in Italy, which took place
in 2009, and the introduction of performance management tools in universities. A quantitative sur-
vey found that management systems existed in all the universities participating in the study. How-
ever, these are strongly characterized by backwardness.102 The reforms have resulted in budget cuts
and new forms of funding that require universities to give top priority to sustainability and man-
agement. Nevertheless, management systems are not yet developed well enough.103 The survey of
universities showed that there is a big lack in the use of MCS. In most universities, there was no
form of control system at all but only an evaluation system. The evaluation systems are considered
in isolation and not linked to organizational performance. Universities indicated that although MCS
would be important for a better and more transparent system of evaluation, but they are too time-
consuming in the preparatory phase and in the implementation phase. Therefore, it is easier for
them to work only with basic systems.104 Although reforms should introduce performance man-
agement and management systems to public organizations, it must be said that there is no one-size-
fits-all solution. Universities, in particular, must consider the complex relationships with politics
and administration. In Italy, universities suffer greatly from the strict separation of academic and
administrative functions. Management tools are set up with formalism and there is a general lack
of resources for administrative improvements. This contrasts with well-founded management.105
Busetti suggests that before change reforms can be implemented, the management and the organi-
zation themselves should be evaluated first and consequently control systems should be imple-
mented.106
The introduction of PMS also affects the roles and influences of the key actors in universities,
according to Melo et al. (2010).107 Pressure for more accountability comes from external forces
like the state and the market which leads to a need of more measurement results in universities
caused by greater competition between universities and demands to be more effective, efficient and
accountable. Melo et al. (2010) requested interviews with members of high performing English
universities and many interviewees mentioned a lack of action – in contrast the focus lays on out-
puts and outcomes. Current PMS lead to an excessive amount of data and the information about
102 cf. Busetti, S./Dente, B. (2014), p. 225.

107 cf. Melo, A. I. et al. (2010), p. 233.
individual performances is not used very much.108 Those pressures for being more efficient and
effective also affected the non-academic staff as administrative tasks are increasing steadily.109
Egginton (2010) speaks of a changed ideology of universities: in the past, university organizations
were characterized by independence and autonomy, relatively free from strict management sys-
tems, commercial responsibility and accountability. However, this ideology has changed in recent
years and decades: a higher level of scrutiny and regulation based on government initiatives has
been introduced, aiming for higher standards and improved quality. This also leads to increased
expectations on part of students and other customers. These changes also require developments in
human resource policy. Egginton mainly deals with staff appraisal systems in his article.110 The
goal of these staff appraisal systems is to create a universal, structured, objective and transparent
way for a system of performance appraisal and development reviews. The expectations of individ-
uals and the organization should be made transparent and developed into common goals. A staff
appraisal system helps to define these goals and constantly monitor the individual on its way there
to develop competences. The system must be fair, and the criteria and structures must be published.
Everyone has to participate in order to achieve greater transparency and to meet the challenge of
increasing the outputs.111 The most important aspect of introducing a new appraisal system is com-
munication: open dialogue, which values autonomy and individual discretion, is of particular im-
portance. In a first step, the management must identify the internal stakeholder groups and then
gradually communicate with these groups in order to create the basis for the successful introduction
of a new system.112 These communications may lead to conflicts - management needs to establish
a balance between the tension of autonomy and academic freedom and the need for common stand-
ards for the establishment of a performance appraisal system. In general, the demands on manage-
ment change from a transactional style of leadership to transformational behaviors that considers
the demands of the situation. This reflects the ongoing great challenge of higher education insti-
tutes.113
Similar results were found by Khoury / Analoui (2004) concerning the implementation of an ap-
praisal system. The authors describe appraisal as a crucial step towards development of human
resources and their performance and examine the impact of an performance appraisal system on
faculty members at Palestinian public universities.114 In order to successfully implement a perfor-
mance appraisal system, the organization's strategy, participation in objectives, coaching,
108 cf. Melo, A. I. et al. (2010), p. 251.

109 cf. Melo, A. I. et al. (2010), p. 252.
110 cf. Egginton, B. E. (2010), p. 119.
111 cf. Egginton, B. E. (2010), p. 127.
112 cf. Egginton, B. E. (2010), p. 128.
113 cf. Egginton, B. E. (2010), p. 130.
114 cf. Khoury, G. C./Analoui, F. (2004), p. 1.
communication, feedback and reward systems need to be considered. Management also needs to
be aware of all external factors that could affect employee performance. During the introduction
process various indicators of dissatisfaction with the appraisal system emerged. These include for
example poor feedback cultures, lack of appraisal interviews, failure to apply appraisal results to
administrative decisions, poor top management commitment to faculty members’ appraisal, etc.
Furthermore, these issues influenced the level of satisfaction and motivation of the faculty mem-
bers.115 The authors emphasize that when introducing a new MCS, the new system often takes
center stage and the value of human resources is given a lower priority. The management must not
forget how unique the individual members contribute to the success of a university. In order to
introduce a MCS that matches the cultural framework of the university, training programs are re-
quired for the faculty members and also for the top management. Management is also responsible
for meeting the requirements and creating the right climate for an effective MCS. The key to meet-
ing these criteria is communication.116
Karuhanga (2015) observes the introduction of PMS in Ugandan universities and speaks of a need
to evaluate the induction process. For the evaluation itself, a separate system would have to be
created which could, for example, contain the following five criteria:
1. alignment of organizational vision, mission, strategy and individual performance goals
2. staff involvement in performance management implementation at unit level
3. existence of an improvement plan
4. existence of a performance evaluation plan
5. staff awareness and understanding of performance management117
Before a PMS can be implemented, management needs to think about some preparations. A feed-
back culture needs to be implemented to reflect the achievement of goals, and employees must be
trained to adopt a PMS, so they know exactly what it entails and what is expected of them. In order
to keep employees motivated, the awareness of the benefits of a new management system should
be emphasized.118
Fernandes / Sumardi (2018) found a link between management process alignment and higher edu-
cation performance, with service quality and organizational commitment being significant media-
tion variables.119 The study was conducted at the University of Hasanuddin in Makassar.120 In

117 cf. Karuhanga, B. N. (2015), p. 1.
118 cf. Karuhanga, B. N. (2015), p. 8.
119 cf. Fernandes, S./Sumardi (2018), p. 410.
general, it can be seen that universities with a quality control system achieve better results than
universities without a quality control system. Organizational commitment supports an open and
fair management process alignment which in turn leads to the creation of employee trust through a
united vision and mission.121 Kagaari (2011) also finds a moderating influence of organizational
culture and climate on performance management practices and managed performance. He observed
and investigated the introduction of PMS to universities in Uganda. According to Kagaari, the
benefits of implementing performance management practices are the improved formation of rela-
tionships through the introduction of information and communication technology, the mobilization
of resources, the adaptation to the external environment and the setting of goals and tasks.122 In the
introduction phase of the new PMS, the universities collaborated with other organizations, the em-
ployees worked in teams and involved competent people to ensure a strategic approach. The man-
agement was required to hold meetings, pay attention to the administrative structures and enforce
discipline. Through proper coordination also the motivation of staff was guaranteed. The design of
the PMS depended on the attitudes of managers and employees - they decided on reward systems,
rules and regulations that facilitate the management of the university and lead to better quality and
cost reduction.123
Kallio / Kallio (2014) state that many existing performance measurement systems are based purely
on quantitative data and neglect qualitative data and management often follows the management-
by-results style. Management-by-results systems have a negative effect on work motivation, ac-
cording to experts. The motivation of university staff is intrinsic and can be described as creative,
knowledge-intensive work. It can be concluded that management-by-results is in conflict with in-
trinsic motivation.124 Empirical data for this study was collected through an Internet-based survey
questionnaire which was sent to employees in Finnish universities. 125 The study findings show that
employees have a relatively large amount of freedom and get highly upset if they think their aca-
demic freedom is being violated. The current management systems intend to give extrinsic rewards
in case the outcome number was reached. Several studies have already indicated that the intrinsic
motivation can be undermined through extrinsic rewards. The empirical findings of this study sup-
port this theory as management-by-results puts pressure on academics (in form of producing a
number of outcomes) and performance-related pays which present the extrinsic rewards are intro-
duced and used in Finnish universities. Those circumstances interfere with the intrinsic motivation
of the employees and Kallio / Kallio (2014) clarify that the quality of work produced in universities

122 cf. Kagaari, J. R. K. (2011), p. 36.
123 cf. Kagaari, J. R. K. (2011), p. 44 et seqq.
124 cf. Kallio, K.-M./Kallio, T. J. (2014), p. 574.
could ultimately suffer as the motivation of employees could decrease.126 Giving extrinsic rewards
to intrinsically motivated employees could lead them to work seemingly harder to reach the in-
tended outcome but the activity might be of lower quality.127
The autonomous motivation of researchers is also topic in the article of Sutton / Brown (2016). The
authors examine how universities which are under increasing external pressures like increasing
demands for papers deal with MCS without threatening the autonomous motivation of their re-
searchers.128 Threats, imposed goals, deadlines, and external performance ratings can reduce in-
trinsic motivation. SDT explains that these elements are experienced as controlling. Instead, there
are means to promote autonomous motivation by e.g. competence-relevant feedback and positive
verbal reinforcements. Also, extrinsic rewards, such as appreciations by other people with whom
researchers feel connected may increase the autonomous motivation of researchers. Findings from
the interviews showed that there are three main categories of what motivates researchers:
1) those who are interested in their discipline, the actual content and the ideas of the research.
2) the technicians who focus on the research process
3) the idealists for whom the results are important as they want to contribute relevant and useful
information to society.
In general, number one and two would define an intrinsic motivation and number three is extrinsic.
But not only autonomously motivated researchers in faculties are important for successful research,
but also the use of MCS can contribute positively by e.g. performance evaluation at group level.
By working in networks, constructive communication and encounters, building relationships, fo-
cusing on the instrumental value of research and long-term thinking through research visions, pres-
sure in the field of research can be eliminated. Changes in cultural and administrative mechanisms
can lead to positive aspects such as the satisfaction of connectedness through personal relation-
ships, as well as through a constructive face-to-face feedback culture and by offering opportunities
to see others' work rate and give feedback.129
Decramer et al. (2012) put their focus on the changed requirements in Belgium and Netherlands
summoned by the NPM. The 2008 financial crisis put the government's budget for higher education
and research under pressure. That's why budget cuts were made, and government and society de-
manded a higher level and higher amount of research output. The need for increased efficiency and
effectiveness led to the adaption of employee PMS. Employee PMS include, for example, the
agreement of objectives, monitoring and reward systems. The authors assume a positive relation

128 cf. Sutton, N. C./Brown, D. A. (2016), p. 577.
129 cf. Sutton, N. C./Brown, D. A. (2016), p. 599 et seqq.
between training and greater involvement, willingness and knowledge. Especially knowledge plays
an important role in the adoption of employee PMS. Managers who have completed training in
these areas have chosen to implement employee management practices.130 Institutional mecha-
nisms have had a major impact on the management of academic staff. In recent years, the focus has
increasingly been on performance outcomes such as the number of published articles. Achieving
these goals requires an adaptation of the management system. Proper use of a well-developed em-
ployee PMS can result in better performance at the university, faculty or academic department.131
In Australia too, universities are in an era marked by changes in management. Christopher (2012)
examined to what extent internal auditing as a control mechanism is adopted at universities. He
mentions that there are many proposals for control mechanisms to implement changes in manage-
ment set by reforms through NPM. One of these proposals deals with internal auditing. In the con-
text of the university, the task of internal auditing lies in assisting the council and senior manage-
ment. The internal auditor provides regular, independent feedback on the adequacy of developed
and performed controls and verifies that controls got also implemented effectively.132 To review
the position of internal auditing at Australian universities, vice counselors were interviewed and
asked if they would support the introduction of internal auditing and evaluate it as an important
component of governance and whether existing internal auditing departments would meet their
expectations.133 The vice counselors provided information about the influencing forces that shape
the organizations in general. Stakeholders such as the country's government, territorial govern-
ments, local councils, authorities and communities and surrounding industrial areas are among
these forces. But also, internal stakeholders such as the collegial and autonomous culture of the
organization and the internal management are part of the complex environment of universities.
Based on these influencing forces, the controls are directed. All respondents agreed that these fac-
tors led to different levels in the development and implementation of MCS. The internal audit de-
partment provides assurance on the controls developed - depending on the individual networks of
relationships, these control systems were different in all universities. In addition, the internal au-
diting was also supported differently by resources of the universities.134 According to respondents'
answers, the main tasks of internal auditing were monitoring of control systems and influencing
forces as well as searching for new stakeholders. 44 percent of respondents said that there was
difficulty in implementing internal auditing. These difficulties lay in an existing tension between
the internal forces and the corporate culture. Furthermore, problems regarding the competences of
130 cf. Decramer, A. et al. (2012), p. 99.

132 cf. Christopher, J. (2012), p. 529.
the administrative staff members were mentioned. They were described as not professional enough
to take on corporate responsibilities. In addition, the collegial and autonomous culture of academics
was in tension with corporate culture, which in turn hindered the adoption of corporate governance
control processes (such as internal auditing). It was also difficult to find competent internal audits
as universities had limited resources and had to compete with the private sector.135 Christopher
concludes that new governance control systems must always be adapted to the situation and culture
of the organization. The various internal and external stakeholders must be considered when se-
lecting and implementing new control tools.136
Chung et al. (2009) adds the organization's strategy to this network surrounding universities, which
must be considered when implementing management systems. It is important that the structure is
autonomous, and that senior management dedicates enough space to innovation. At the moment,
the orientation of university policies is often resource-oriented, for example on budgetary perfor-
mance benchmarks. These budget periods are typically geared annually. A strategy that aligns with
service innovation must be able to react quickly, depending on changes in the market and new
product / program developments. The time frames in which innovations can accrue are long-term.
In order to promote effectiveness and efficiency, a long-term alignment of the strategy of univer-
sities is required.137
This is also where Cugini et al. (2011) comes in and shows how important it is for academic de-
partments to be clear about the strategy they are pursuing. The authors recommend the implemen-
tation of a Balanced Scorecard (BSC) which could lead to improvements in the following areas:
quality of research, reputation, relationships with local community, human capital. By introducing
a BSC, the strategy is visualized, the connections between mission, strategic goals and adequate
measures are shown and those do not only serve to monitor performance, but also address the
management. Management in turn may benefit from the BSC to strategically allocate the resources.
In a general way, BSC helps to translate the strategy into actions. Cugini et al. provide insights into
the launch process of a BSC and how important a feedback culture is to ensure that the identified
indicators are in line with the mission and strategy of the university or academic unit. Above all,
the coordination of the various stakeholders must be given importance. Another side effect of in-
troducing a BSC is that academic and administrative staff get educated concerning the importance
of performance management, measurement and evaluation.138
Taylor / Baines (2012) observe the implementation of BSC in four UK universities and look at the
impact of this technique on the formation, monitoring and evaluation of strategy and policy in

137 cf. Chung, T. K. J. et al. (2009), p. 9.
138 cf. Cugini, A. et al. (2011), p. 11.
universities.139 Each university mentioned and showed that the preparation for implementing a BSC
especially matters to e.g. get support of the staff during the implementation phase.140 All universi-
ties strongly supported the implementation of a BSC as it can provide a “direction of travel” and
helps to achieve the goals set by the strategy. The UK universities also emphasized that there is no
need of an additional level of bureaucracy or a high level of costly management information if the
BSC is developed and applied with care. After the application of the BSC the universities reported
positive impacts in the alignment of communication and strategy, the exploring of the environmen-
tal relations and the links between strategic goals and operational tasks. Taylor / Baines investigated
as well as Cugini et al. the effect of growing expertise and experience in the implementation and
use of the BSC.141
The strong focus on monetary ratios, which was mentioned by the authors Chung et al. (2009)
before is also criticized by Cohen / Holder-Webb (2006). The authors do not criticize the strategic
orientation of the university, but the economic education itself. According to the authors, ethical
aspects and adherence to principles must again be brought to the fore in university programs. The
university serves not only to impart knowledge and skills but should also have a role model char-
acter. Students should be able to observe lived organizational fairness and identify reward systems
that are oriented towards procedural fairness and outcome fairness. The introduction of internal
auditors at universities could serve as a good example of independence and professionalism.142
A study by Boe examines the extent to which teachers and professors in higher education are mo-
tivated to use information and communication technology.143 To test this, a questionnaire was sent
by e-mail.144 The results of the study show that teachers and professors would welcome an infor-
mation and communication technology that clearly defines (teaching) goals and establishes a goal
harmony and reduces the potential for conflicting goals. This information and communication tech-
nology should primarily intend to build and clearly define an incentive system so as to clearly
manage and at best confirm the expectations of employees. Basically, the system would be struc-
tured to firstly have guidelines for measuring the incentive system and define clear objectives, and
second, to define institutional measures that stimulate teachers' perceived usability, affirmation and
willingness to take risks. After defining these measures, it is important to clarify how they will be
implemented. For example, the perceived usefulness and the confirmation could be increased by
139 cf. Taylor, J./Baines, C. (2012), p. 111.

140 cf. Taylor, J./Baines, C. (2012), p. 121.
141 cf. Taylor, J./Baines, C. (2012), p. 122 et seq.
142 cf. Cohen, J. R./Holder-Webb, L. L. (2006), p. 26.
143 cf. Boe, T. et al. (2015), p. 375.
144 cf. Boe, T. et al. (2015), p. 378.
increased competence. In this case, for example, training programs could be realized. Important in
new electronic systems for information and communication is that the focus must be on education
and not on the technology itself. Especially for risk-averse teachers, it is important to sensitize them
to new technologies. This could lead to a strengthening of the collaboration among themselves and,
for example, the exchange of different teaching materials and teaching methods.145
Manning / Barrette (2005) explore the challenges of a research performance management when
researchers come from diverse cultures and origins, speak different languages, publish in different
languages, work in different disciplines and use various methodologies. The authors try to create a
method of assessment of research productivity and quality as research performance is of particular
importance for decisions concerning hiring, tenure, promotion and funding.146 Their new system
for research performance management would first align with the strategic objectives of the institu-
tion to give a clear signal to what is valued by the organization. Second, the use of various meth-
odologies and the engagement and consultation with members of research committees would en-
courage individual contribution in decision making within research performance management pro-
cesses. In addition, individuals’ contribution would also enhance their experiences fairness and
flexibility as the new system would comply with modifications depending on the needs of the in-
stitution and the members. Third, the reward system would be adapted to the individual researchers’
circumstances and give them information for further improvement.147
The relationship between MCS, uncertainty and performance in research was surveyed by Omta /
De Leeuw (1997).148 The study consisted of in-depth interviews and questionnaires of research and
development directors, institute directors, professors and senior scientific staff. The results show
that there is a fundamental association between management control and performance.149 The level
of uncertainty affects the task environment of research. Developmental research became more un-
certain and researchers felt like journals were not willing to publish non-significant results. That is
the reason why many researchers did not want to go through all the trouble of publishing and de-
cided not to release their results publicly.150 The results of Omta / De Leeuw also show that personal
control, administrative control and external control is strongly connected with research perfor-
mance in universities. In universities with developed MCS the duration of administrative proce-
dures was clearly shorter and the communication among each other was more intense.151 Personal
145 cf. Boe, T. et al. (2015), p. 382.

146 cf. Manning, L. M./Barrette, J. (2005), p. 273 et seq.
147 cf. Manning, L. M./Barrette, J. (2005), p. 280.
148 cf. Omta, S. W. F./De Leeuw, A. C. J. (1997), p. 223.
control turned out to be the most important control mechanism as the best universities used career
systems which enhance an inspiring work environment. Research directors of low-performance
institutes talked about a loss of commitment of their research and development staff and it was
indicated, that the lack of career opportunities was one of the major reasons.152
Modell (2003) states in his article that the development of PMS at universities in Sweden is subject
to some difficulties and is not proceeding in an optimal way. A major problem is the lack of links
between the MCS, all systems are seen individually, and the complex interaction of the systems is
neglected. In order to obtain higher levels of funding, universities must be able to provide more
detailed financial ratios, but the development of these financial ratios at universities is slow.153
Vakkuri / Meklin (2003) argue that in general the appropriate search (design mode) and the appli-
cation (use mode) of performance management in universities tend to be problematic. Difficulties
arise from the cultural background of universities. Universities often see PMS as structures of at-
tention rather than formal systems of accountability. This is why universities reduce the importance
of PMS through acting rationalities and policies of representation.154 In this context it is important
to understand the controversy that results from the academic culture on the one hand and the PMS
as accountability technology on the other hand.155 Knowledge-intensive organizations are charac-
terized by an organized skepticism and perceive external controls such as output controls as intru-
sive. Therefore, planning the introduction of a PMS must take the cultural atmosphere and the
climate at universities into account, otherwise there will be problems in applying these systems.156
An article from 1995 by Mills shows the reasons for new MCS in universities. Mills emphasizes
in his article the need for internal control and the importance of ethical issues in the not-for-profit
environment. Lack of internal control can lead to weak management decisions, inappropriate use
of resources, and unethical practices.157 Since not-for-profit organizations do not seek profit and
thus do not have profit as a key indicator for financial regulations, there are other types of controls
necessary. These include, for example, a tight structure of accounting, administrative controls and
internal auditing. The tasks of the internal auditor are assisting the management, controlling

153 cf. Modell, S. (2003), p. 333 et seqq.
154 cf. Vakkuri, J./Meklin, P. (2003), p. 751 et seq.
155 cf. Vakkuri, J./Meklin, P. (2003), p. 754.
156 cf. Vakkuri, J./Meklin, P. (2003), p. 756.
157 cf. Mills, P. A. (1995), p. 377.
financial resources, investigating financial transactions, evaluating internal control mechanisms,
evaluating cost efficiency and ensuring the appropriate use of public funds.158
9.6. External factors impacting the introduction of MCS
Not just internal but also external factors impact the introduction of MCS. Broad / Goddard (2010)
therefore undertook semi-structured interviews in UK universities to find out more about the im-
plementation of performance management at these universities. The authors emphasize on the im-
portance of the managerial ideology, originally called “weltanshauung” by them.159 The ideology
of managers should, according to Broad / Goddard, be changed to one where the environment is
more considered in a constructive way. The findings showed that external factors have a clear
influence on the performance of universities but are less considered in the reporting systems. Clear
linkages between internal and external metrics should exist but did not. In general, all MCS used
were considered as individual instruments without any connection.160 The authors focus primarily
on external research metrics, which can often be difficult to include in the university's internal
management systems, or rather the implementation of such metrics often brings difficulties. A
move towards an external research measure that has a longer-term focus could lead to the harmo-
nization of university-internal management systems and the goals of academics. Same timeframes
would then result in common goals and thus change the “Weltanshauung” of all concerned.161
Clermont / Dirksen (2016) also deal with the research activities of universities. Their paper focuses
on the independent institutions which issue ratings and rankings by examining the information
universities have acquired and services rendered by universities.162 Due to the heterogeneity of the
many country-related and academia-related ranking procedures, the aim of the authors' paper is to
analyze the ranking method of CHE (Centre for Higher Education) in Germany which evaluates
the research performance of business schools in Germany. The assessment of a university's perfor-
mance is difficult, as there are basically no exogenous market prices for such services to draw
comparisons. The management of such performance measurements is therefore usually carried out
by external institutions such as the CHE. These institutions obtain and aggregate the necessary data
from the universities and finally publish their results in the form of rankings. The data of the uni-
versities are evaluated according to predefined criteria to rank entire universities or individual de-
partments. The assessments can be carried out in all areas, so rankings around the world, for ex-
ample, refer to the quality of education or doctoral programs. CHE is an independent institution
158 cf. Mills, P. A. (1995), p. 383.

159 cf. Broad, M./Goddard, A. (2010), p. 60.
162 cf. Clermont, M./Dirksen, A. (2016), p. 1.
and not bound by instructions. The main activity of the organization is the development of univer-
sity rankings.163 CHE obtains and evaluates data from teaching performance and research perfor-
mance on a three-year-cycle and generates an exclusive ranking related to research. The main goal
is to provide information to interested stakeholders of a university and to create transparency re-
garding the performance of a university. Meanwhile, these ranking results are mainly used by gov-
ernment agencies and university managements to compare performance and compete with each
other.164 Out of this context emerges a Principal-Agency-Theory situation. The data, which are
published by universities, must be critically examined. The principal (in this case, CHE) is inter-
ested in timely and usable information for decision-making. The agent (in this case, the university)
has an extrinsic motivation to be presented as favorably as possible so that its position in the ranking
order with other universities is as good as possible. Divergent interests and asymmetrically distrib-
uted information can lead to personal coordination problems.165 Almost every university ranking
seeks to create transparency about the performance of universities by providing information to
stakeholders. In this context, it is incomprehensible why certain information in Germany cannot or
should not be published, such as the use of public funds. It would be important to find a system
that, on the one hand, provides the stakeholders with information and, on the other, reduces the
administrative workload of the universities.166
Cohen / Holder-Webb (2006) criticize the general orientation of universities in the business sector.
The authors refer to the criticism of business media, which emphasizes the lack of teaching of
relevant skills as well as an irrelevant orientation of many research movements.167 Many prevalent
economic and accounting theories pursue a self-interest behavior. These theories guide research
and shape future academics. A collection full of self-interested actors leads to conflicts of interest
which consequently, have to be solved by means of incentives, monitoring and regulatory ac-
tions.168 Accounting focuses too much on numbers and decision-making is based on existing infor-
mation. Any information that is more difficult to quantify is systematically excluded and ignored.
Thus, the value to act in public interest declines. The interests of stakeholders such as vendors,
communities, employees are neglected, even though they hold a key position, which would be
particularly important for the successful growth of a company.169
163 cf. Clermont, M./Dirksen, A. (2016), p. 2 et seq.

166 cf. Clermont, M./Dirksen, A. (2016), p. 17 et seq.
The authors emphasize the importance of taking into account many stakeholders and a public in-
terest perspective for proper action in the later real business world. Assuming a stewardship per-
spective, students would consider multiple stakeholders and have more regard to the environ-
ment.170
Kagaari (2011) argues that it is necessary to develop market-driven academic programs which meet
the stakeholder needs for surviving in a competitive educational environment. Therefore, managers
need to reposition the institution and scan the hyper changing competitive environment continu-
ously as stakeholders needs change and resources evolve. Recreating, renewing and reconfiguring
existing institutional resources as well as developing new academic programs belong to the tasks
of managers. Managers are required to accurately sense changes in their environment and further-
more, be able to act on those opportunities and threats.171
The relationship between external pressures and the adoption of an employee PMS has been de-
scribed by Decramer et al. (2012). The authors examine the many external pressures to which aca-
demic units are subject. As a result, different employee PMS have been developed by several aca-
demic units.172 First, the administrations of universities put pressure on employee performance
management as changing policies, university administrations and central human resource manage-
ment departments promoted several employee performance management practices. Second, fund-
ing agencies put pressures on academic units due to a rapid growth of external research partnerships
with non-profit organizations, government bodies and corporations.173 Third, one of the major com-
ponents of the Bologna Process is the accreditation which also puts pressure on employee perfor-
mance management as the accreditation process makes universities more oriented towards contin-
uous improvement and assessments. Departments needed to become more output-oriented and im-
plement quality systems to meet the expectations of the accreditation standards. Basically, the ex-
ternal pressures can be divided into coercive and mimetic processes. Coercive pressures include
rules by the government, accrediting agencies and funding agencies. Mimetic processes are present
when academic units imitate practices and systems of other institutional contacts and through
movements of people between institutions. The academic unit aims to copy a very successful or-
ganization within their sector.174 The authors also observed how dependencies of academic units
affect institutional pressures: the more dependent the academic unit is on an external funder, the
more the unit adopts the employee performance management practices used by the partner.

171 cf. Kagaari, J. R. K. (2011), p. 36.
Decramer et al. emphasize the relevance of a human resource management that considers market
and institutional processes.175
Increasing competition between universities in the UK is also highlighted by Melo et al. (2010).
The demand for higher efficiency and effectiveness has been increasing rapidly since the introduc-
tion of policies by the British government in the 1980s. Main pressures for measurements come
from the state and the market whose role increased as well over the last few years.176
Knott / Payne (2004) mention that political cultures and economic conditions can play an important
role in determining the features of university performance. Performance features depend for exam-
ple on the competitive surrounding market – if public or private education dominates the higher
education landscape or if a university has a medical school. A medical school brings advantages
like more political support, high salaries and large federal grants. Also leading personalities and
the quality of the board leadership have a remarkable position of influencing the performance of a
university.177
The increasing managerial pressures from higher levels of management and outside forces directs
also research units to introduce new organizing elements into the workplace. Sousa et al. (2010)
held twenty-nine interviews with research directors and program managers in the Netherlands and
found out that out of research managers’ positions towards performance management there
emerged ambivalence. Through negotiations and collaborative leadership styles research depart-
ments coped with new performance norms, expectations and demands of a growing managerial
agenda.178
9.7. Internal factors impacting the execution of MCS
Ab Hamid et al. (2013) constructed and validated an instrument to measure value-based perfor-
mance excellence in higher education institutions in Malaysia. The results of their analyzed ques-
tionnaires showed that factors of leadership, cultures, productivity, employees, stakeholders and
overall performance results are interrelated and decisive for the success of organizations.179 Con-
sequently, higher education institutions need to focus on those core values to reach excellence in
performance.180
175 cf. Decramer, A. et al. (2012), p. 699 et seq.

176 cf. Melo, A. I. et al. (2010), p. 252.
177 cf. Knott, J. H./Payne, A. A. (2004), p. 27.
178 cf. Sousa, C. A. A. et al. (2010), p.1439 et seqq.
179 cf. Ab Hamid, M. R. et al. (2013), p. 3019.
180 cf. Ab Hamid, M. R. et al. (2013), p. 3029.
Agyemang / Broadbent (2015) see the nature of controls in universities as contextually defined.
Along with MCS there comes also the need to influence the behavior of individuals. If universities
want to get support by the government, they had no other choice than introducing a PMS for their
academics – part of it is for example the developmental appraisal. However, a reorientation in the
management of universities was required through new rules / standards set by the government.181
The authors also mention that there are two types of MCS: first, they can be introduced as support
mechanisms for individuals and second, they can be coercive and restrict the behavior of individ-
uals. Therefore, it is important to know how individuals contribute to the way MCS are used in
organizations and consider their cooperation. Also, the systems that are developed by the academic
staff to control themselves must be considered.182 Some of the MCS that were created use tighter
controls over individual academic actions than the external regulatory systems actually intended
initially. The increased importance of journal rankings has for example undermined the beliefs of
the culture of research. A surveillance became embedded in universities and researchers feel as
“taken for granted” as values of universities changed. Although, the journal ranking guide has been
accepted as a part of universities’ PMS, the ranking systems still have been suddenly infiltrated the
belief systems of academics. That’s why there was a move away from relational and informal MCS
towards transactional MCS.183
Those moves can lead to an eroding of academic values through gaming by universities and indi-
viduals within universities – the reorientation measures initially thought to protect those academic
values by boundary management.184 In summary, the authors argue that it is necessary to adapt to
the external regulatory environment, but it is at least as important to consider the internal context
of an organization and the goals that you want to achieve. While achieving good ranking results is
one of the most important research goals, it obviously should not be the organization's single pri-
mary goal. The core values of an organization should not be compromised but rather determine the
internal organizational MCS. Informal and relational controls that strengthen talent and support
researchers in all areas are probably more appropriate to management control processes for research
areas in universities.185
The use of a PMS that motivates employees to high performance should be one of the main objec-
tives of university managers. Jacobsen / Andersen (2014) examined command systems in univer-
sities and built up a study consisting of a survey in combination with interviews. The results showed
that command systems which are perceived as controlling are less effective and can even harm the
181 cf. Agyemang, G./Broadbent, J. (2015), p. 1022 et seq.

182 cf. Agyemang, G./Broadbent, J. (2015), p. 1024.
performance.186 In general, the perception of the command system is much more important than
the hardness of the command system.187 The effect of command systems depends on the appropri-
ate enactment by leaders, which means that it is vital for managers to show consistency, fairness
and skills while using management tools.188 The authors suggest that managers should think about
the message command systems send and the perceptions command systems release when imple-
menting a new system, especially because university staff shows a high level of intrinsic motivation
which could decrease if command systems are perceived as control devices.189
The perceptions towards a university’s research PMS were also examined in Australian universities
by Martin-Sardesei / Guthrie (2018). PMS were implemented for measuring and managing the
research performance. However, there have been some unintended consequences in the form of
anxiety, fear, gaming, strategic initiatives, focus on quantity instead of quality, increased workload
and loss in the stock of human capital. The authors mentioned that university managers could im-
prove the design and execution of PMS by not only focusing on the outcomes and the systems
themselves but providing training, support and maintaining the overall well-being of academic
staff.190 Human capital systems in general should be designed to improve and develop the skills
and performances of individual academics. Through the current applied systems the university cul-
ture shifts towards management-by-results, the competition increases and the collegiality de-
creases.191 Especially the local management at universities plays an important role how PMS get
implemented as the managers translate national policies into management systems. Many institu-
tional and contextual factors have to be considered as the influence the introduction and execution
of new systems.192
Alach (2017) examined the maturity of implemented PMS in New Zealand universities in the pe-
riod 2008-2013 and found results that showed strengths in the alignment of measures for strategic
direction, the quality of commentary and the improvement of frameworks for outcomes. Neverthe-
less, performance information is not always used for guiding decision-making in institutions and
the quality of measures vary from university to university.193 The evolution of the use of perfor-
mance management in universities makes slow processes which could possibly be related to the
culture of universities. The culture is shaped by a professional and individualistic atmosphere and
186 cf. Jacobsen, C. B./Andersen, L. B. (2014), p. 84.

190 cf. Martin-Sardesei, A./Guthrie, J. (2018), p. 53 et seq.
191 cf. Martin-Sardesei, A./Guthrie, J. (2018), p. 64.
192 cf. Martin-Sardesei, A./Guthrie, J. (2018), p. 65.
193 cf. Alach, Z. (2017), p. 1.
those characteristics may be highly resistant to managerial trends such as performance manage-
ment. The result is minimal compliance with the given external standards coupled with limited
internal implementation processes of performance management.194 A second paper concerning the
maturity of PMS in New Zealand’s universities of Alach which was published as well in the year
2017 showed that research output measures were the most common used measurements.195 Perfor-
mance information of individuals was used to help set individual job expectations, to review group
performance and to reward staff.196 Academics as well as administration staff agreed that qualita-
tive performance measurement is of benefit for universities whereas less support was found for
quantitative measurements.197 Financial management measures seem to be the most commonly
used ones in New Zealand’s universities although they were seen as having significantly lower
positive effects. The authors indicate a “DRIP” situation which is the abbreviation for “data rich –
information poor”. It means that there is a multitude of financial data which does not lead to useful
action. The university staff felt that financial measures had a negative impact on other aspects of
performance.198
The use of performance measures also influences people’s sense of vitality and stress. Franco-
Santos et al. (2017) observed relationships between university governance practices and staff well-
being. Through a survey with a sample frame of 3650 employees working in UK universities the
authors identified misalignments between the job demands and responsibilities and the way insti-
tutions govern people which in turn affects the well-being of the staff.199 The findings of their
survey also show that control governance practices appear to be advantageous for the well-being
of people in academic leadership positions but not for faculty without leadership responsibilities.
This means that people in academic leadership positions do not experience the negative effects of
control governance practices in the way as faculty staff without leadership positions does. How-
ever, collegial governance practices are beneficial for the well-being of staff regardless their posi-
tion and leadership responsibilities. Those practices seem to bring high levels of vitality and low
levels of stress with them.200 Considering the results of the survey, the authors question the transi-
tion towards enhanced control governance practices in universities with strong focus on financial
measures and hard performance measures in general as these governance practices could lead to
194 cf. Alach, Z. (2017), p. 8.

195 cf. Alach, Z. (2017), p. 102.
196 cf. Alach, Z. (2017), p. 108.
197 cf. Alach, Z. (2017), p. 110.
198 cf. Alach, Z. (2017), p. 112.
199 cf. Franco-Santos et al. (2017), p. 711 et seqq.
200 cf. Franco-Santos et al. (2017), p. 723.
dysfunctionalities rather than to improvements. An alternative collegial governance practice could
lead to higher levels of well-being and thus to enhanced performance at work.201
Universities also reflect a role model - universities, their graduates and professors are close to future
developments and have a significant impact on future leaders, teachers and parents in future gen-
erations. They do not only train through education, research and knowledge transfer, but also
through an exemplary set of management systems. Therefore, for example, it should not be seen as
a risk to report poor performance - quite the contrary: It shows that first steps are taken to improve
the situation and errors are detected. This process builds trust.202
Birnbaum (1979) explains in his paper that in ambiguous, uncertain situations leaders with high
structure will be seen as satisfying leaders by subordinates because they reduce the frustrations of
the subordinates. High task-oriented leaders perform well in unstructured situations – those leaders
are necessary for team research projects as they bring a high potential for intragroup conflict. When
conflicts arise, all members benefit from an open discussion of the discrepancies.203
Graham (2016) interviewed three academic managers to find out how they think about the work-
load of academic staff and the extent to which they use appropriate performance management. The
analysis of the interviews showed that the workload and performance management are not linked
at the operational level.204 Although, the academic managers had a clear and good understanding
of workload management, the components of PMS were not understood commonly across all three
managers. Also, the linkages between workload and PMS were poorly understood.205 The results
show that the transition to business-orientation in universities in the course of NPM sometimes is
simply reduced to metrics and the internal politics of the university get neglected.206
Kairuz et al. (2016) even argue that current PMS used in universities are inappropriate for the
higher education sector as creative, reflective and critical thinking gets negatively affected by de-
mands and stress. Defined key performance indicators and performance management are harmful
for the university sector as they cause undue stress and thus influence cognitive thinking in a neg-
ative way.207 The challenge for the leaders of universities is finding a balance between generating
research outputs and fulfilling performance requirements and the “cognitive-critical-thinking-
201 cf. Franco-Santos et al. (2017), p. 725.

202 cf. Adams, C. A. (2013), p. 1 et seqq.
203 cf. Birnbaum, P. H. (1979), p. 236 et seq.
204 cf. Graham, A. T. (2016), p. 1042.
205 cf. Graham, A. T. (2016), p. 1061.
206 cf. Graham, A. T. (2016), p. 1061 et seqq.
207 cf. Kairuz, T. et al. (2016), p. 1 et seq.
space” that is essential for the work of university academics.208 The authors emphasize that the
management in universities needs urgent attention because if the demands keep rising, the work
environment of higher education institutions could be highly threatened.209
The authors Kallio et al. (2016) also deal with this topic and mention that PMS have disrupted the
academic life. Through an extensive mixed methods study in 2010 of how PMS are understood by
academics across universities in Finland, results showed that performance management was con-
sidered as discouraging innovation and novelty and leading to bland research. The focus shifted
from quality to quantity and from collegial university management to quantitative measurement on
all levels.210 Nevertheless, some respondents of the survey emphasized their strong ethos towards
doing meaningful academic research through intrinsic motivation.211 But the ethos is changing as
the new implemented systems negatively influenced the originality, autonomy and freedom of ac-
ademic work. The authors suggest that before systems get implemented into an organization, the
leaders should pay attention to the societal and socio-cultural context where principles and prac-
tices of performance management are adopted and adapted.212 Teelken (2015) mentions in this
context that a new balance for academics needs to be found how to deal with professionalism and
managerialism. Former academics were expected to do good research and publish it and now they
are expected to publish sufficiently, and they are autonomous in the way how to do so.213
Duh et al. (2014) examine the improvement of operating efficiency as a result of internal controls
in universities in Taiwan.214 Through data from questionnaire survey they found that the internal
control implementation had a negative and significant association with research related effi-
ciency.215 The authors’ findings also indicate effects of differential incentives on using internal
control to improve efficiency. The current funding system in Taiwan does not seem effective for
public universities through internal controls. Therefore, Duh et al. emphasize on the importance of
designing an incentive scheme for public universities which is associated to the internal control
system of universities and follows the objective of improving operating efficiency.216
The organizational control mechanisms and systems determine the incentive schemes and reward
schemes. Johnson (2011) mentioned in his article that various control variables should be taken
208 cf. Kairuz, T. et al. (2016), p. 7.

209 cf. Kairuz, T. et al. (2016), p. 7 et seq.
210 cf. Kallio, K.-M. et al. (2016), p. 685 et seqq.
211 cf. Kallio, K.-M. et al. (2016), p. 701.
212 cf. Kallio, K.-M. et al. (2016), p. 702 et seqq.
213 cf. Teelken, C. (2015), p. 307 et seq.
214 cf. Duh, R.-R. et al. (2014), p. 173.
215 cf. Duh, R.-R. et al. (2014), p. 193.
216 cf. Duh, R.-R. et al. (2014), p. 193.
into account when analyzing a system. Most important is to consider the stage of organizational
development or its lifecycle as organizational controls change across the development of organiza-
tions.217 Another two important variables are cooperative partnerships and the development of trust
within the organization. An atmosphere shaped by trust can decrease goal incongruence and thus
less application of monitoring and behavioral controls that otherwise might be used. Social-con-
nectedness, IP policies and technical skills should be analyzed as well for a more effective use of
management systems.218
The article of Esposito et al. (2013) investigates the relationship between PMS and knowledge in
public universities. The authors found that PMS could provide an important social tool for easing
the management of organizational knowledge.219 PMS were seen as important tools for leadership
improvement and were useful for the transfer of responsibilities. All the universities that were ex-
amined emphasized the importance of communication between management and human resources
at all stages of the introduction of PMS.220 In their article, the authors referred to Simons’ Levers
of Control to categorize organizational solutions for managing performance assessments. The cat-
egory of "belief methods" included the communication of principles, rules, values, expectations
and standards with the participants during the different phases of a PMS. Management solutions
that are brought formally into the PMS with the purpose to provide methodological inputs and
constraints regulate the assessment processes and belong to the category of “boundary methods”.
The "diagnostic controls" comprise various planning instruments. These planning tools are man-
agement tools and methods that help define goals to perform the given tasks of PMS such as pro-
gramming, monitoring, measuring and evaluating. The planning tools help to define strategic and
operational goals with various tools such as the Balanced Scorecard and various key performance
indicators. Sometimes the goals set are also compared and matched with competitors, which means
that the benchmarking system is used. Also, common management tools used in the internal ac-
counting systems belong to the category of “diagnostic controls”. The "interactive methods" de-
scribe the last category and connect all methods and tools within a PMS. Interactions and collabo-
rations are used in different ways through meetings, intranet, etc.221 The authors recognized a rel-
atively widespread use of diagnostic controls in universities to influence the processes of account-
ability and target evaluation. In general, it can be seen that the choice of instruments from these
categories influences the knowledge production of a university. The main goal of many universities
217 cf. Johnson, W. H. (2011), p. 842.

218 cf. Johnson, W. H. (2011), p. 849.
219 cf. Esposito, V. et al. (2013) p.1.
220 cf. Esposito, V. et al. (2013) p. 7.
221 cf. Esposito, V. et al. (2013) p. 8.
is to build an organizational memory to improve knowledge about their intellectual capital and to
simplify external controls as much as possible. Therefore, it is necessary to first explicate
knowledge in order to improve the internal performance and, in a next step, to develop and support
the ability to build an organizational network.222
The use of IT solutions for strategic knowledge management is in a relation with the performance
(measured in terms of scientific outcome) of a university and Fernández-Lopez et al. (2018) exam-
ined this relation.223 The authors examined a positive relation between IT based strategic
knowledge management and university’s performance.224 However, unlike expectations, the per-
formance of a university did not increase if the institution became more efficient in the use of IT
solutions. In addition, the percentage of researchers using institutional tools of collaborative work
has a strong negative impact on the performance of universities in terms of publications. One ex-
planation could be that some researchers use non-institutional instruments such as Dropbox or
GoogleDocs. The users of institutional tools of collaborative work might also be oriented towards
other outcomes (projects, collaborations) and not just focused on publications. An alternative ex-
planation would also be that the researchers did not experience enough training in dealing with the
institutional tools and now need more time, which in turn reduces the capacity of the university's
publications.225
The authors Masa’deh, et al. (2017) put another focus in this area as they examine the relationship
between knowledge performance management and job performance. The data was collected using
a questionnaire for university lecturers in Jordan. The results show that there is a significant rela-
tionship between knowledge management, capabilities, processes and performance. Also
knowledge management and job performance are positively and significantly correlated with each
other and the job performance can be improved through a respectable knowledge management
environment which basically means keeping and sharing professional knowledge and experience
with other members of the universities. The questioned lecturers believed that sharing knowledge
with other colleagues will increase their willingness to collaborate, broaden their knowledge, in-
crease their problem-solving abilities and increase their work efficiency.226 To achieve this, new
systems are needed that encourage the lecturers to present their ideas and their knowledge. An
appropriate reward system would be necessary. In addition, new mechanisms are needed to protect
the knowledge inside and outside the university.227
222 cf. Esposito, V. et al. (2013), p. 9.

223 cf. Fernández-Lopez, S. et al. (2018), p. 567.
226 cf. Masa’deh, R. et al. (2017), p. 244 et seqq.
227 cf. Masa’deh, R. et al. (2017), p. 258.
Van den Brink et al. (2013) deal with recruitment and selection practices for academic talents in
the Netherlands and how talent and performance management become a key issue for human re-
source management in universities. The authors identified three dilemmas in talent and perfor-
mance management for universities:228
1) transparency versus autonomy
2) power of human resources versus power of academics
3) equality versus homogeneity.
First, the academic world is shaped by an allocation of rewards and resources governed by the
normative principles of transparency and objective performance systems. Through the adoption of
management practices from the private sector, the universities have been transforming from a col-
legial system which was dominated by high levels of independence and autonomy, to a managerial
mode.229 Second, the human resource management advisors should monitor and accompany the
recruitment process but are not official members of committees and thus do not have authority. A
lack of power and inside knowledge often leads to a missing detection of political games and fa-
vored candidates so that they cannot manage the process differently.230 Third, the candidates are
not necessarily the best academics but due to the official members of committee the most suitable.
Generally, candidates are not allowed to disrupt the current situation and at the same time they are
expected to be innovative.231 The authors highlight the distance between the human resource man-
agement instruments and the actual social interactions and processes in academic recruitment situ-
ations.
9.8. External factors impacting the execution of MCS
In addition to the internal factors, external factors also have an impact on the execution of MCS.
As already several times mentioned the nature of control in universities is contextually defined.
The external environment affects control systems as for example the technologies of NPM did.
Agyemang / Broadbent (2015) argue that universities had no choice but to introduce those new
technologies in form of performance evaluation systems for their academic staff to ensure contin-
ued support by the government.232 The control systems are felt as judgmental for some academics
and seem to be disturbing the academic atmosphere. External control systems become internalized
228 cf. Van den Brink, M. et al. (2013), p. 180.

and individualized and show how the state, funding agencies and the market use their power to
dominate discourses with economic pressure, legislation and symbolic power. Consequently, uni-
versities are forced to comply with external pressures like the demanding accountability.233
Ter Bogt / Scapens (2012) also mention that the new systems seem to be more judgmental as they
i.e. seek to quantitatively evaluate performance. The authors examined an increasing use of judg-
mental forms of performance evaluation in the UK and in the Netherlands. The systems are felt as
judgmental as although they emphasize objective quantitative measures, they relocate subjectivities
rather then remove those and thus create anxiety and uncertainty about how those systems are used.
Furthermore, creativity and innovation in the academic context are threatened.234 The increasing
focus on journal rankings comes with a domination of the top international journals by North Amer-
ica. This means that academics have to follow the research agenda and research methods that are
favored by those top journals.235 Universities got more controlled by governments in both countries
– the UK and the Netherlands and academic staff has to perform in an environment of declining
resources that thus leads them to play safe and go for easier publications where relatively minor
contributions are made to the existing literature.236 The authors question the intended transparency
and objectivity of performance measurement systems and explain that anxiety and stress will in-
crease because funding pressures will further increase the emphasis on performance management
and individual performance evaluation.237
Martin-Sardesai et al. (2017) meant that there is a need to respond to external controls and the
regulatory environment, but there is also the need to consider the internal context of the organiza-
tion itself and the objectives it wants to achieve. The combination of both, internal and external
factors, creates a challenge.238
De Franca et al. (2010) explain the relationship between external regulators and stakeholders and
universities in Brazil by means of the Principal-Agency-Theory as clearly information asymmetry
has an impact on organizational efficiency. The principal therefore is the government and the man-
ager of the university acts as the agent.239 The authors analyzed optimization problems concerning
common goals and relevant inputs and outputs. The agent is distancing himself from the objectives
of the principal and gets more risk-tolerant. The principal subsequently, desires an improved
233 cf. Agyemang, G./Broadbent, J. (2015), p. 1023 et seq.

234 cf. Ter Bogt, H. J./Scapens, R. W. (2012), p. 451.
238 cf. Martin-Sardesai, A. et al. (2017), p. 410.
239 cf. De Franca, J. M. F. et al. (2010), p. 39 et seqq.
control and incentive system which leads to changes in regulation to increase the level of adherence
by the universities to the objectives of the principal.240
The Principal-Agency-Theory is also used by Kivistö (2005, 2008) to illustrate the inter-organiza-
tional relationship between government and higher education institutions in a more theoretical and
analytical way. The theory can provide improved understanding for the establishment of quality
assurance systems and performance-based funding procedures.241 Generally, in case of controlling
moral hazard, the principal can act in two ways: first, he can use monitoring procedures such as
behavior-based contracts and discover the agent’s behavior through reporting processes, budgeting
systems and additional layers of management. Second, the principal can contract on the outcomes
of the agent’s behavior (outcome-based contract) because in some situations monitoring processes
are simply too expensive or too difficult. In outcome-based contracts the agents’ rewards depend
directly on the performed outcomes. Basically, the principal tries to achieve goal congruence with
the agent through outcome-based contracts.242 But both options of the principal cause problems:
Within monitoring procedures, the main problem facing the government (principal) is information
asymmetry as higher education institutions (agents) have highly specialized knowledge and not
programmable production processes. If also goal conflicts exist it is likely that the principal has to
face the problem of moral hazard.243 Opportunistic behavior of the agent, subsequently, could be
one possible explanation for performance failures.244 Preventing information asymmetry is possible
through outcome-based contracts as the existence of information asymmetries does not matter any
longer. The funding is tied to pre-defined explicit and measurable results. But in this case occurring
problems could be the specification of outcomes because not all outcomes of higher education are
measurable simply. Soft outcomes could suffer as the funding is tied to quantifiable outcomes. No
matter which option the principal is going to choose, there will always be challenges with regard
to divergence of interests and informational asymmetries.245
Olson (2000) found a relationship between the boards of trustees and presidential demography and
institutional performance in US universities.246 The demographic characteristics of board members
played a role in determining performance outcomes. The demography can stand for values that a
person holds and was therefore used to gain insights into how a board member may performs and
thus select board members. The tenure of board members in consequence, influenced school reve-
nues and gifts – the longer the average tenure of board members was, the more school revenues
240 cf. De Franca, J. M. F. et al. (2010), p. 54.

241 cf. Kivistö, J. (2005), p. 1.
242 cf. Kivistö, J. (2005), p. 6.
243 cf. Kivistö, J. (2005), p. 12.
244 cf. Kivistö, J. (2008), p. 348.
245 cf. Kivistö, J. (2005), p. 12 et seq.
246 cf. Olson, D. E. (2000), p. 280.
and gifts were enhanced. An explanation for this relationships could be the Principal-Agency-The-
ory position: Long-tenured boards are less likely to be selected by the management team and do
not feel under the control of management what in result makes them more independent and capable
of doing a good job of monitoring the management.247 A more homogeneous board tended to com-
municate better and led to more gift income at universities. This may make them better at control-
ling functions. The performance of universities improved as the boards grew larger and longer
tenured, gained members with business executive background and represented an ethnic diver-
sity.248
Knott / Payne (2004) examine the impact that state governance structures have on the way univer-
sity managers allocate resources, develop sources of revenue and promote research and education.
Many universities operate in a more regulated setting today due to state governance issues. The
analysis of Knott / Payne suggests, that productivity and resources are higher at universities with a
statewide board that is more decentralized and has fewer regulatory power.249 The governance
structures vary from one state to the next, but this variation affects the constraints and opportunities
university managers have for allocating resources between research and education.250 The manage-
ment of higher education institutions is mediated by historical and geographical factors, different
political cultures and economic conditions. In the East of the US public universities are in compe-
tition with well-developed private systems of higher education. In the West, the public education
dominates the higher education systems. An important role plays the degree of centralization in
how well a system responds to statewide political issues. Decentralized systems tend to push ad-
ministrators of universities towards a private university model where tuition revenues and research
dollars are focused. The opposite would place students and maybe lower tuition revenues in the
forefront but neglect research and faculty support.251 Government structures do not only impact the
management of universities, but also influence of the quality of application systems at universities
by influencing the sensitivity to quality rather than by direct and tight control over academic insti-
tutions. Therefore, Mizrahi / Mehrez suggest that government bodies can create a ranking of insti-
tutions’ quality and thus allow applicants to differentiate between various institutions. Highly se-
lective criteria based on quality indicators for academic education provide another tool for creating
sensitivity to quality in those systems.252
247 cf. Olson, D. E. (2000), p. 292.

248 cf. Olson, D. E. (2000), p. 294.
252 cf. Mizrahi, S./Mehrez, A. (2002), p. 53.
Abramo et al. (2011) examined the market for research collaborations between university and in-
dustry in Italy. The authors analyzed international scientific publications and found results that
suggest that geographic proximity plays a key role in the choice of corporate university partners.
Inefficiencies in the market can also be identified as many private companies could have found
better qualified research partners in the immediate vicinity.253 The reason why research collabora-
tions exist is that for company there is an opportunity to access specialized knowledge and compe-
tencies of researchers – the authors mention so-called “macro-competencies”.254 Most collabora-
tions (78 percent) consist of only two partners: the university and the company. However, the mis-
sions of the two partners are very different: Universities try to spread knowledge as widely as
possible while companies protect their knowledge and use it for their own specific commercial
purposes.255 The only reason why companies work together with more than one university is that
sometimes they need different competences that perhaps cannot be offered only by one univer-
sity.256 The national market in Italy for public-private collaborations is characterized by an infor-
mation asymmetry, which leads to inefficiency in the market. This inefficiency results in collabo-
rations where private companies do not start partnerships with the most qualified universities in the
pertinent discipline. There is a presence of a proximity effect which means that geographic distance
is important in the choice of university partners. The results showed that 93 percent of companies
could have collaborated with higher ranking universities. An explanation for those inefficient
choices could be that information on the quality of research by public scientist is not available in
Italy.257
University-industry collaborations were also examined by Huang / Chen (2017) as universities’
role in innovation becomes more diverse and universities are more and more encouraged to engage
in entrepreneurial activities. Therefore, the establishment of university-industry collaboration
(UIC) could help to implement a formal UIC-management, UIC regulations and to support an in-
novative climate which thus can influence the academic innovation performance of universities.
The results of 141 analyzed Taiwanese universities showed that UIC management might be one of
the most essential factors for enhancing the academic innovation performance.258 UIC management
requires arrangements for control and coordination in those collaborative relationships. Universi-
ties hire more industry experts and seek potential industry partners and thus contribute to a creation
of more UIC partnerships. Management mechanisms in universities stimulate more UIC activities
253 cf. Abramo, G. et al. (2011), p. 84.

254 cf. Abramo, G. et al. (2011), p. 89.
255 cf. Abramo, G. et al. (2011), p. 97.
256 cf. Abramo, G. et al. (2011), p. 98.
257 cf. Abramo, G. et al. (2011), p. 98.
258 cf. Huang, M. H./Chen, D. Z. (2017), p. 210.
and therefore lead to an improvement of academic innovation. The authors found that supporting
an innovative climate in general can moderate the enhancement of academic innovation perfor-
mance. Means for creating an innovative environment and atmosphere are for example holding
entrepreneurial contests, conducting UIC forums and offering intellectual property courses.259
Hammond et al. (2006) collected data of US schools of business about how market orientation and
management emphasis on market orientation influences overall performance. The results show that
market orientation is an important component for achieving performance excellence in higher ed-
ucation.260 Many actions and behaviors suggested by the marketing concept can also be used in the
context of higher education, but marketing academics have to realize that those actions and behav-
iors could lead to performance excellence. The authors suggest that higher education and business
practitioners could learn from each other.261 The study raised an alarm for higher education as
management emphasis on market orientation and levels of market orientation are alarmingly low
within higher education. The authors implied, then, that performance could be higher as the study
provided empirical support for the positive relation between market orientation and performance.
Therefore Hammond et al. suggest that greater emphasis on market orientation should be placed.
A first step would be to familiarize higher education managers with marketing theories and con-
cepts.262
Voss et al. (2005) suggests that the same management models can be applied in both sectors: private
and public. The authors collected data with a sample of 291 public and private organizations in the
UK and the results showed that human resource management practices led to employee satisfaction
and in turn to service quality and customer satisfaction. A main reason for lower performance could
be a lack of employee focus in both areas – public and private. The results showed that human
resource factors have stronger impact than quality procedures on service quality and customer sat-
isfaction.263 Public organizations lagged in management practices and performance. A solution
could be bringing new practices to the public sector to improve organizational performance. That
means that public sector managers could have a closer look to new management systems and tech-
nics out of the private sector and adapt and implement them intelligently to the public sector con-
text.264
259 cf. Huang, M. H./Chen, D. Z. (2017), p. 214.

260 cf. Hammond, K. L. et al. (2006), p. 69 et seqq.
261 cf. Hammond, K. L. et al. (2006), p. 80.
262 cf. Hammond, K. L. et al. (2006), p. 82 et seq.
263 cf. Voss, C. et al. (2005), p. 179.
264 cf. Voss, C. et al. (2005), p. 191.
Broadbent et al. (2010) analyze the nature of societal regulatory control systems and illustrate that
different types of regulation are related to different contexts in which they are developed.265 Every
organizational PMS and any societal regulatory system can be described as transactional or rela-
tional system. A transactional mechanism can be described as a market exchange where financial
transferors have rights to expect a delivery of some defined ends or outcomes while the means to
be used to achieve those ends or outcomes do not necessarily need to be specified. An underlying
control and command systems is very typical for transactional mechanisms as for example money
could be used for things other than supporting the achievement of outcomes. A relational mecha-
nism in contrast, focuses on outcomes and means to reach those outcomes but in a more liberal
way on the basis of wider stakeholder involvement and agreement. Regulation processes need to
be accepted and agreed by stakeholders.266 The authors recognize a strong emphasis on transac-
tional controls and mechanisms in England's higher education and note that levels of freedom are
thereby affected. Organizing all control measures according to transactional patterns will not be a
solution, as universities in particular consider themselves autonomous and will defend and resist
these systems.267
265 cf. Broadbent, J. et al. (2010), p. 506.

10. Discussion and limitations
The following chapter is intended to provide the analysis of the results, connections to the theoret-
ical approaches and to the literature are established. The chapter should primarily serve to answer
the research questions taking into account the theoretical approach. Furthermore, limitations of the
work are shown.
The division into internal and external factors influencing MCS in universities was defined in the
course of processing or reading the individual articles. The more articles that have undergone the
analysis, the clearer are underlying structures that exert different degrees of influence on the MCS.
Very soon it could be established that these influences do not always come from management levels
in the university itself, but the environment and organization of universities is characterized by
many more target groups. Speaking of target groups, therefore, stakeholder theory was included in
the theoretical approaches. However, this theory not only explains the splitting of the results of the
meta-analysis into external and internal factors, but also serves as an essential basis for explana-
tions of MCS in general. In order to embed a highly developed MCS in the university context, all
possible target groups have to be considered and, in a further step, priorities set to meet the demands
and needs of the various stakeholders268. Even if the results of the analysis are characterized by
heterogeneity, the majority of the authors of the analyzed articles, nevertheless, emphasize on the
importance of considering the context of a university and all its possible influencing factors. This
is also where the stakeholder theory with the analysis of interest groups comes in - in the university
context there is a relatively broad distribution of stakeholder groups, as especially many external
stakeholders (for example government, intermediaries, sponsors, business partners, communities,
alumni, etc.) must be taken into account.269
The separation of the analysis into the selection, implementation and execution of MCS as well as
the design of the research question was defined during the analysis of literature. Many authors as
well as subsequent, analyzed articles deal with a very specific section of MCS. A rough categori-
zation was therefore made regarding the progress of MCS in universities. In this sense, the classi-
fication was made according to the extent of used or planned MCS at the respective universities:
some authors discussed topics of the selection and introduction process of MCS, others analyzed
the maturity or efficiency and effectiveness of already implemented MCS. A categorization in im-
plementation processes and execution processes was therefore obvious.
268 cf. Freeman, R. E. et al. (2010), p. 24 et seqq.

269 cf. Chapter 8.2.2.
The thesis is based on the four theories: Stakeholder Theory, Principal-Agency-Theory, Self-De-
termination-Theory and Contingency Theory. In the context of universities, these theories inter-
lock: relations between individual stakeholders can be explained by the Principal-Agency-Theory
- in this thesis, the focus is on the relationship between government and university. These two
partners have special characteristics, because the organization "university" is surrounded by many
special features, such as a multitude of different employees with a special working environment
and a climate in the organization that is characterized by autonomy and intrinsic motivation in
contrast to companies in the private sector 270. The new reforms, such as the NPM, have changed
control mechanisms in universities - there is an increasing focus on output controls 271, which in
turn has impacts on many other areas, such as: the climate, employee satisfaction and quality of
performance in the organization. These relationships between different control mechanisms can be
well explained by the presented frameworks272. For example, publication numbers or the creation
of IC reports for external stakeholders could be assigned to the "diagnostic controls" of Simons
(1994)273 or to the category "result controls" from the Merchant / Van der Stede framework
(2012)274. Malmi / Brown differentiate a little more and would assign the creation of a Balanced
Scorecard, for example, to the Cybernetic Controls, which falls into the category of hybrid meas-
urement systems 275. In all frameworks, it can be seen that changing one control mechanism inevi-
tably has simultaneous impact on other fields - Malmi / Brown's presentation of the framework
demonstrates that cultural controls and administrative controls span all areas. This would mean that
the introduction of an output-based control system, for example based on the number of published
articles in peer-reviewed journals, requires such planning as well as the reward and compensation
systems should also be geared accordingly. Reward and compensation systems are often financial
in nature, which means that when a certain number of published articles is reached, a monetary
amount would be paid out as a reward. However, the SDT now explains that salaries of a financial
nature, particularly in the university context, can be detrimental to culture and motivation, as fi-
nancial incentives can have the opposite effect, i.e. causing demotivation, instead of a motivating
effect276. In the case of incentive systems, special cultural and personal characteristics must first be
clarified and taken into account in order to avoid negative consequences. In the example case, the
incentive systems would have to be selected in such a way that they correspond to the culture and
the personal characteristics of the employees. For example, a research trip could be used as a
270 cf. Egginton, B. E. (2010), p. 119 et seqq.

271 cf. Zelewski et al. (2017), p. 558 et seq.
272 cf. Bobe, B. J./Taylor, D. W. (2010), p. 6.
273 cf. Simons, R. (1994), p. 6 et seqq.
274 cf. Merchant, K. A./Van der Stede, W. A. (2012), p. 9 et seqq.
276 cf. Deci, E./Ryan, R. M. (1985), p. 5-6.
reward. The principal agency theory tries to explain such incentive schemes by the need for a goal
congruence between the principal and the agent - the principal wants to gain the commitment of
the agent through incentive schemes in order to achieve the goals of the organization, he designs
incentive schemes that encourage the agent to act in the favor of the principal.277. However, this
relationship between the principal and the agent must be seen in a broader context because the
development of incentive schemes is more difficult in the university context than in the private
sector, since the mere determination and measurement of goals raises problems (e.g. goals to in-
crease quality in teaching, determination of performance criteria, determination of measurable var-
iables in the field of research, etc.). Furthermore, the special organization and administration of
universities has to be taken into account as well as the maintenance of a fair, autonomous and
innovative climate for maintaining the quality of performance in the many areas of universities.
This shows in a short presentation the complexity of the organization "university" regarding the
development of MCS. All of these factors vary from university to university and need to be adapted
to the particular circumstances in which the Contingency Theory intervenes. Already when con-
sidering Human Resources (new researchers, support for students, various university collabora-
tions, research projects, etc.) at universities, it becomes clear that effective and efficient MCS must
be constantly in motion to improve activities and performance, and constantly have to adapt to the
new conditions as quickly as possible - in line with the Contingency Theory278.
The most common internal factors influencing the introduction of MCS are the complex relation-
ship between university policy, administration and management, the lack of resources for the de-
velopment of new systems, the complex relationships and interests within and outside universities,
the ideology of universities and employee PMS.279 Furthermore, a new system would have to be
fair and transformational in order to properly assess the demands, depending on the situation. Man-
agement needs to ensure the right climate in the organization before introducing a new system,
which should be done through communication. In order to keep employees motivated at universi-
ties, reward systems are required, which are adapted to the individual employees and their intrinsic
motivation. In particular, more attention should be paid to personal and cultural controls, as changes
in these areas could lead to a reduction or even elimination of pressure in research. Examples in-
clude working in networks, building a constructive communication culture, joint research projects,
building connectedness, career systems and commitment.280 Difficulties are mainly related to the
compatibility of internal control mechanisms and the culture of universities, as the academic
277 cf. Saam, N. J. (2002), p. 6.

278 cf. Otley, D. (1999), p. 367.
279 cf. Busetti/Dente (2014), p. 225 et seqq.
280 cf. Egginton, B. (2010), p. 119 et seqq.
freedom and autonomy of researchers should not be restricted. Before introducing a new system, it
would be important for managers and employees to be trained in MCS, measurement and evalua-
tion. A clear management strategy before and during the implementation process is essential.281
External factors influencing the introduction of MCS are, above all, the complex environment of
universities. The environment must be taken into account constructively and as far-reaching as
possible before a new system can be introduced.282 It would be important to find a system that, on
the one hand, provides all stakeholders with important information and, on the other hand, keeps
administrative work at universities low.283 In general, the neglect of many external stakeholders is
criticized, which also extends to the educational offer of universities. Many business courses ne-
glect a public interest perspective and external stakeholders as financial metrics take priority. Leg-
islation, government structures, political cultures and competitive markets also influence the selec-
tion and implementation of MCS.284
For existing MCS, internal factors such as leadership, culture, productivity, employees, stakehold-
ers and performance have been identified as influencing the execution. The interrelations of the
various factors are not sufficiently considered. It is seen as particularly important that managers
demonstrate consistency, fairness and competence while running MCS.285
The already introduced MCS are often geared too much to quantitatively measurable values and
financial ratios. A system that addresses the individual development of academic skills is often
missing.286 Due to the strong business orientation in universities in the course of NPM, internal
processes of universities are neglected. Kairuz et al. (2016) even claim that the introduced PMS in
the context of NPM are inappropriate for the university context.287 Creative, reflective and critical
thinking is affected by such systems. Some of the systems that have already been introduced were
introduced without regard to the socio-cultural background of university staff. 288 In addition, there
are no incentive systems adapted to the university's internal control system.289
281 cf. Khoury/Analoui (2004), p.1 et seqq.

282 cf. Christopher, J. (2012), p. 534 et seqq.
283 cf. Clermont/Dirksen (2016), p. 17 et seqq.
284 cf. Cohen/Holder-Webb (2006), p. 17 et seqq.
285 cf. Melo et al. (2010), p. 252.
286 cf. Egginton/Broadbent (2015), p. 1039 et seq.
287 cf. Kairuz et al. (2016), p. 1 et seqq.
288cf. Agyemang/Broadbent (2015), p. 1039.
289 cf. Jacobsen/Andersen (2014), p. 84 et seqq.
Similar to external factors influencing the introduction of MCS, the analysis of the external factors
influencing the execution of MCS was following. Funding bodies, government and the market can
use their power at any time and force universities to introduce or adapt systems.290 Many universi-
ties feel too controlled by the government and perceive performance evaluations as judgmental,
which in turn leads to stress and anxiety in the workplace.291 The relationship between government
and universities is often shaped by information asymmetries and consequently influences the effi-
ciency of universities. Geographic, historical, economic and political factors also play a role in the
execution of MCS, as, for example, competition and financing structures vary from country to
country. University-industry partnerships are increasingly coming to the fore to support the inno-
vative academic climate.292 A stronger orientation towards entrepreneurship and market orientation
is required in order to be able to withstand competition and to improve the performance of univer-
sities. Basically, there is a strong focus on transactional control systems that affect the freedom of
academics.293
As part of the categorization into internal and external factors that influence the selection, imple-
mentation and execution of MCS at universities, the external factors repeatedly mentioned theories
and frameworks for explaining the relationship structures of the different stakeholders. The most-
mentioned theory in the selected articles was the Principal-Agency-Theory in the field of external
stakeholders. In order to answer the second research question of this thesis, the Principal-Agency-
Theory has to be considered in the context of higher education. Since it has already been mentioned
that relatively many interest groups have to be taken into account in the university area, the distri-
bution of the role of the principal and the role of the agent is not always clear.294 However, accord-
ing to the analysis of the articles, the classification of the roles was uniform: the university employ-
ees (rector, deans, researchers, professors, managers, etc.) represent the agents and the policy (gov-
ernment, ministries, etc.) is regarded as the principal. The reason why many authors use the Prin-
cipal-Agency-Theory to explain the relationship between politics and academia is probably due to
ambiguity in the distribution of competences and the definition of common goals. Above all, the
strong focus on research services in terms of publications seems to bring many problems. These
research services often serve as a basis for the distribution of funds, for quality evaluations, for
rankings and, consequently, the position in the competitive market, for incentive systems, etc.295
290 cf. Manning/Barrette (2005), p. 280.

291 cf. Omta/De Leeuw (1997), p. 223 et seqq.
292 cf. Abramo et al. (2011), p. 84.
293 cf. Huang/Chen (2017), p. 210 et seqq.
294 cf. Dilger, A. (2001), p. 133 et seqq.
295 cf. Chapter 9.6 / Chapter 9.8.
The introduction of MCS such as research performance measurements is intended to increase trans-
parency and efficiency in the achievement of objectives and quality assurance in the field of re-
search. The purpose of these systems, which are specified from the outside, are increases in effi-
ciency and transparency through pre-established criteria. In the private sector, the creation of com-
mon goals is easier to generate than in the non-profit sector, since here usually the profit can be set
as a common target. Creating common goals in the higher education sector is associated with more
complications. Sometimes the goals of the principal are not one hundred percent clear or compre-
hensible and the fulfillment or achievement of the goals is not transparently observable. Missing
relationships of trust and different preferences can lead to the idea and expectations of goals and
the processes of goal achievement between principal and agent differing and disagreeing. In the
following, "hidden knowledge", "hidden characteristics" and "hidden actions" can lead to an asym-
metrical distribution of information, a threat to the relationship and a threat to the achievement of
the goals. In order to prevent this, incentive systems must be created that are not just of a material
nature.296 Many authors (Cohen / Holder-Webb 2006, Broad / Goddard 2010, Decramer et al.,
2012, De França et al., 2010) emphasize that focusing on financial measurements and subsequently
purely financial incentives jeopardizes academic culture because it is strongly influenced by intrin-
sic motivation. The situation in which agents align the achievement of objectives due to their in-
trinsic motivation, for example through a particularly strong interest in the field of research, has
probably not been sufficiently analyzed yet. In order to ensure a goal congruence with staff in
research and teaching at universities, it would be necessary to adapt the incentive systems to their
motivation. For example, scientific networks, professional travels, scientific reputations and other
non-monetary incentives could be taken into account when developing incentive schemes.297
The peculiarity of the culture in universities has been emphasized several times in this work. In the
analyzed articles, which concern the internal factors for the introduction and execution of MCS at
universities, there is a recurrent mentioning of intrinsic motivation of the employees at universities
and an academic freedom and autonomy.298 Sutton / Brown (2016) show three ways of how re-
searchers can be intrinsically motivated299:
1) Interest in the discipline, current content and ideas of research.
2) Technical interest in the research process
3) Idealistic interest in presenting relevant and meaningful results in order to contribute to society.
296 cf. Clermont/Dirksen (2016), p. 17 et seqq.

297 cf. Cohen/Holder-Webb (2006), p. 17 et seqq.
298 cf. Egginton, B. (2010), p. 130.
299 cf. Sutton, N. C. / Brown, D. A. (2016), p. 577.
Monetary rewards and incentive systems can reduce this intrinsic motivation. By academic free-
dom and autonomy, it is meant that the working environment of researchers has been little con-
trolled for a relatively long time. NPM reforms required the introduction of new MCS, such as
employee PMS and auditing of publications. Academic staff feel deprived of their freedom and
autonomy by introducing controls and this can lead to less labor input and quality loss. Therefore,
it would be important in the university context to pay attention to these conditions and adjust the
controls accordingly when planning an introduction or adaption of personal and cultural controls.
SDT provides information about possible work environment configurations to sustain intrinsic mo-
tivation. For example, through measures such as self-initiation support, providing relevant infor-
mation without requiring control, offering alternatives, recognizing different perspectives, building
knowledge networks, etc., managers can ensure that employee autonomy is protected, and out-
comes are positive.300
As already mentioned in the introduction of this work, universities have to deal with the introduc-
tion and execution of MCS on two levels. On the one hand, on the strategic level, to follow the
trend towards entrepreneurial orientation, to adapt the strategy and not to suffer competitive disad-
vantages, and on the operational level, due to the increased demand for information disclosure and
transparency in relation to all activities and tasks in the university context, which leads to changes
in university life. Operational MCS and MCS already running, are often characterized by systems
introduced as a result of reforms, dependencies, laws, etc. This means that these management sys-
tems are not always implemented voluntarily and that the associated strategy may not be anchored
in the universities or not realized at all. In order to achieve the best possible performance, it is first
necessary to set strategic goals and further be able to derive operative goals from them. The analysis
of the articles sometimes showed that the newly introduced systems are being implemented and
executed (due to a mandatory application), but the adaptation of the strategy to these new systems
and the objectives, that should be achieved by them, has not (yet) been done.
In line with the previous paragraph, new reporting structures can also be understood as new man-
agement systems. Universities seem to have to deal with an increased demand for information - on
the one hand, more transparency in terms of processes, outputs and outcomes on the part of gov-
ernment and society is required and, on the other hand, information must also be disclosed and
reported due to the development towards an economic market. In this context, one should not forget
the different starting conditions between a private company and a public university: While a pri-
vate, profit-seeking company can report relatively simply about its activities and results, this is far
300 cf. Deci/Ryan (1985), p. 5 et seqq.

more difficult for a university. Due to the broad dissemination of the tasks of universities, the pro-
curement of information proves to be much more difficult than in private companies. However,
these data are the basis for the introduction and implementation of new management systems, new
controlling tools and new reporting procedures. There is a need to explain the difficult information
procurement process in the university context to external stakeholders.
For the management of universities, however, not only new trends, developments and new systems
prove to be a challenge, but also the leadership of the employees. The special working atmosphere
and, above all, the intrinsic motivation of employees in universities should not be destroyed by new
instruments or new systems. Researchers, who experience fear and pressure through new research
performance measurements, are likely to do their job, but they do not feel well while doing it. This
in turn leads to a loss of quality and possibly to fluctuation. For decades or even centuries, it has
become apparent that employees in any area can be guided by fear or by motivation to get their
work done. Fear is the wrong path in the long term, and especially in the university sector, where
work motivation is intrinsically anchored in researchers, the introduction of new assessment mech-
anisms and new control mechanisms must not lead to a shift in the climate from a motivational
environment to a stressful environment.
In summary, it can be seen that the introduction and execution of MCS at universities must take
into account the identification of all relationships with stakeholders, all possible influencing factors
and the specificity of the academic culture which again is in harmony with the contingency theory.
Only then a system construct adapted to the respective university can be designed that integrates
all these factors and connects and correlates different systems in a university as far as possible.
University management needs to be aware that all systems have an impact on other areas, so a
holistic view would be of immense importance. The constant, rapid development of the environ-
ment is also a challenge for the management, as the systems have to be adapted again and again to
withstand the competitive market. It was thus striking during the analysis and processing of the
articles that only one article dealt with a MCS framework. Esposito et al. (2013) used the Simons'
Levers of control framework for their article and thus recognized relationships between the indi-
vidual systems. The majority, however, neglects the overall picture of management systems as a
package.
This work also has some limitation, so in the meta-analysis only articles were used, which were
written in English. Other languages were not taken into account - due to the international nature of
the topic, publications in other languages would be of interest here, for example in Spanish, in order
to better uncover and track developments in South America.
Furthermore, there has only been searched in three databases for articles for the analysis. The da-
tabases used were Web of Science, EbscoHost and Scopus. A larger search in other databases
would probably lead to more contributions and could enrich the work with other important influ-
ences.
The developed search string can be further extended and applied in other forms. In this search
string, terms of the three frameworks of Simons, Malmi / Brown and Merchant / Van der Stede
were used. Also, other frameworks could be considered and included in the term collection for the
search string.
Furthermore, this diploma thesis deals only with MCS in universities, the tertiary sector or higher
education. MCS in all other areas, business sectors or different levels of education were not in-
cluded.
The focus of this work was on the identification of MCS in public universities - private universities
were not excluded per se (in the selection of the relevant articles), but for the most part only pub-
lications on universities in the public sector could be found. There was no splitting between public
and private universities.
Future areas of research or identified gaps in the literature form the lack of links between control
mechanisms at universities and incentive systems. Many incentive systems are still monetary in
nature, which can have counterproductive effects due to the specific conditions in universities. It
would also be important to examine the extent to which new MCS in universities affect employees
and the university climate. Some authors reported in the analyzed articles of reduced motivation,
increasing pressure, more stress and anxiety in the workplace. The negative effects of new systems
would have to be examined in more detail (ideally before the systems were introduced) and then
measures should be suggested to prevent these negative effects.
Higher quality and greater efficiency in research areas could be achieved through research net-
works. With regard to the effects or generally the use of research networks, very little was reported
in the analyzed articles. Also SDT mentioned networks as a possible way to enhance and maintain
self-determination and intrinsic motivation.
Also, the effects of different, individual MCS on other areas or other systems in universities repre-
sents a research need. It would be interesting how a university develops a MCS as a package and
adapts different systems in the appropriate environment. Timing the introduction and monitoring
the implementation of an MCS framework would provide useful data regarding the interrelation-
ships between the systems and the associated benefits as well as difficulties.

11. Conclusio
The diploma thesis deals with the internal and external influences on the introduction and execution
of MCS in universities. The introductory chapters gave general theoretical explanations of MCS,
followed by some conceptual and systematic explanations of subsections of MCS. Subsequently,
three frameworks were presented: Simons' Levers of Control, MCS as a package by Malmi / Brown
and the framework of Merchant / Van der Stede.
The theoretical basis of this work are four theories: Contingency Theory, Principal-Agency-The-
ory, SDT, and Stakeholder Theory.
Two of these theories were further explored in two research questions: first, the SDT was related
to the culture of universities and analyzed in terms of personal and cultural controls, and second,
the Principal-Agency-Theory explained the relationship between the government (Principal) and
university (Agent).
The method of meta-analysis was used to collect data to answer the research questions, analyzing
57 articles identified by a search string in three databases and by pre-established inclusion and
exclusion criteria.
The results of the meta-analysis show that in the introduction of MCS into universities, internal
factors such as e.g. the complex relationships between university policy, administration and man-
agement as well as the lack of resources for the development of new systems play an essential role.
The complex environment of universities as well as a lack of public interest perspective were men-
tioned as external, influencing factors in the introduction of MCS in universities. The execution of
MCS is shaped by e.g. internal factors such as leadership, culture, managements consistency and
fairness and external factors such as the government, sponsors, market orientation. The Principal-
Agency-Theory showed that the incentive systems are not adapted to individual academics, and
that difficulties in developing common goals between government and university are encountered.
The SDT in the context of university culture provides suggestions as to how intrinsic motivation
can be maintained among researchers by, for example, adapting the controls to the specifics of the
university rather than stubbornly ignoring the culture. In summary, it was clear that the identifica-
tion of all relationships with internal and external stakeholders is necessary, as well as the consid-
eration of the environment, the specific conditions of a university and the highly motivational cul-
ture for a development of a best possible MCS. The interrelationships and connectedness between
systems and adjustments due to ongoing developments present challenges for the management of
universities.

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13. Appendix
Search strings
WEB OF SCIENCE
General
(TI=((MCS OR control systems OR performance measurement OR Title
performance management) AND (universit* OR higher education OR Results: 221
college* OR tertiary education OR high school* OR higher program*
OR high level education OR academ* OR educational institution OR
institute* OR institution* OR academic facult* OR research institu-
tion* OR tertiary school* OR third education))) AND LAN-
GUAGE: (English) ANDDOCUMENT TYPES: (Article)
Specific I
(((TI=((lack of direction OR lack of motivation OR personal limita- Title
tions) AND (universit* OR higher education OR college* OR tertiary Results: 1
education OR high school* OR higher program* OR high level edu-
cation OR academ* OR educational institution OR institute* OR in-
stitution* OR academic facult* OR research institution* OR tertiary
school* OR third education))))) AND LANGUAGE: (English) AND-
DOCUMENT TYPES: (Article)
General + Specific I
((TI=((MCS OR control systems OR performance measurement OR Title
performance management OR lack of direction OR lack of motivation Results: 222
OR personal limitations) AND (universit* OR higher education OR
college* OR tertiary education OR high school* OR higher program*
tion* OR tertiary school* OR third education)))) AND LAN-
GUAGE:(English) AND DOCUMENT TYPES:(Article)
Specific II
((((TI=((organizational limitations OR pre-action review* OR behav- Title
ioral displacement OR result control* OR action control* OR person- Results: 75
nel control* OR result control OR gamesmanship OR slack resource*
OR information asymmetry OR action accountability OR physical

constraint* OR administrative constraint* OR action planning con-
trol*) AND (universit* OR higher education OR college* OR tertiary
education OR high school* OR higher program* OR high level edu-
cation OR academ* OR educational institution OR institute* OR in-
stitution* OR academic facult* OR research institution* OR tertiary
school* OR third education)))))) AND LANGUAGE: (Eng-
lish) ANDDOCUMENT TYPES: (Article)
General + Specific
(((TI=((MCS OR control systems OR performance measurement OR Title
performance management OR lack of direction OR lack of motivation Results: 297
OR personal limitations OR organizational limitations OR pre-action
review* OR behavioral displacement OR result control* OR action
control* OR personnel control* OR result control OR gamesmanship
OR slack resource* OR information asymmetry OR action accounta-
bility OR physical constraint* OR administrative constraint* OR ac-
tion planning control*) AND (universit* OR higher education OR col-
lege* OR tertiary education OR high school* OR higher program*
tion* OR tertiary school* OR third education))))) AND LAN-
GUAGE: (English) ANDDOCUMENT TYPES: (Article)
Specific III
(((((TI=((reinforcement OR tracking OR tightness OR system tight- Title
ness OR cybernetic control* OR internal control* OR formal control* Results: 489
OR informal control* OR belief system* OR boundary system* OR
diagnostic control system* OR interactive control system* OR agency
theor* OR contingency theor* OR financial result control*) AND
(universit* OR (higher education) OR college* OR (tertiary educa-
tion) OR (high school*) OR (higher program*) OR (high level educa-
tion) OR academ* OR (educational institution) OR institute* OR in-
stitution* OR (academic facult*) OR (research institution*) OR (ter-
tiary school*) OR third education))))))) AND LANGUAGE: (Eng-
lish) ANDDOCUMENT TYPES: (Article)
General + Specific
(((((TI=((MCS OR control systems OR performance measurement Title
OR performance management OR lack of direction OR lack of moti- Results: 583
vation OR personal limitations OR organizational limitations OR pre-

action review* OR behavioral displacement OR result control* OR
action control* OR personnel control* OR result control OR games-
manship OR slack resource* OR information asymmetry OR action
accountability OR physical constraint* OR administrative constraint*
OR action planning control* OR reinforcement OR tracking OR tight-
ness OR system tightness OR cybernetic control* OR internal con-
trol* OR formal control* OR informal control* OR belief system* OR
boundary system* OR diagnostic control system* OR interactive con-
trol system* OR agency theor* OR contingency theor* OR financial
result control*) AND (universit* OR higher education OR college*
OR tertiary education OR high school* OR higher program* OR high
level education OR academ* OR educational institution OR academic
facult* OR research institution* OR tertiary school* OR third educa-
tion))))))) AND LANGUAGE: (English) AND DOCUMENT
TYPES: (Article)
EBSCOHOST
title
TI ((MCS*)OR(performance measurement)OR(per- Results: 175
formance management)OR(control system*)) AND TI
((universit*)OR(higher education)OR(col-
lege*)OR(tertiary education) OR(high
school*)OR(higher program*)OR(high level educa-
tion)OR(academ*)OR(educational institution)OR(in-
stitute*)OR(institution*)OR(academic facult*)OR(re-
search institution*)OR(tertiary school*)OR(third edu-
cation))
Title
TI ( organizational limitations OR pre-action review* Results: 21
OR behavioral displacement OR result control* OR
action control* OR personnel control* OR result con-
trol OR gamesmanship OR slack resource* OR infor-
mation asymmetry OR action accountability OR phys-
ical constraint* OR administrative constraint* OR ac-
tion planning control* ) AND TI ( universit* OR higher
education OR college* OR tertiary education OR high

school* OR higher program* OR high level education
OR academ* OR educational institution OR institute*
OR institution* OR academic facult* OR research in-
stitution* OR tertiary school* OR third education )
Title
TI ( reinforcement OR tracking OR tightness OR sys- Results: 93
tem tightness OR cybernetic control* OR internal con-
trol* OR formal control* OR informal control* OR be-
lief system* OR boundary system* OR diagnostic
control system* OR interactive control system* OR
agency theor* OR contingency theor* OR financial re-
sult control* ) AND TI ( universit* OR higher education
OR college* OR tertiary education OR high school*
OR higher program* OR high level education OR
academ* OR educational institution OR institute* OR
institution* OR academic facult* OR research institu-
tion* OR tertiary school* OR third education )
title
TI ( MCS OR control systems OR performance meas- Results: 273
urement OR performance management OR lack of di-
rection OR lack of motivation OR personal limitations (abstract 6327)
OR organizational limitations OR pre-action review*
OR behavioral displacement OR result control* OR
action control* OR personnel control* OR result con-
trol OR gamesmanship OR slack resource* OR infor-
mation asymmetry OR action accountability OR phys-
ical constraint* OR administrative constraint* OR ac-
tion planning control* OR reinforcement OR tracking
OR tightness OR system tightness OR cybernetic
control* OR internal control* OR formal control* OR
informal control* OR belief system* OR boundary sys-
tem* OR diagnostic control system* OR interactive
control system* OR agency theor* OR contingency
theor* OR financial result control* ) AND TI ( universit*
OR higher education OR college* OR tertiary educa-
tion OR high school* OR higher program* OR high
level education OR academ* OR educational

institution OR institute* OR institution* OR academic
facult* OR research institution* OR tertiary school*
OR third education )

Management Control Systems in Universities Másolata

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Management Control Systems in Universities Másolata

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to obtain the academic degree of

Magistra der Sozial- und Wirtschaftswissenschaften

in the Diploma Program

Linz, December 2018

14. December 2018 Daniela Zweimüller II

1.1. Statement of problem ........................................................................................................ 1

1.2. Structure of the thesis ........................................................................................................ 2

2. Purpose of Thesis ...................................................................................................................... 3

3. Research questions .................................................................................................................... 4

4. Management Control Systems .................................................................................................. 5

4.1. Definition of MCS ............................................................................................................. 5

4.2. Purposes of MCS ............................................................................................................... 6

5. Theoretical explanations ........................................................................................................... 6

5.1. Conception of Performance ............................................................................................... 6

5.1.1. Performance Measurement .................................................................................... 8

5.1.2. Performance Management ..................................................................................... 9

5.1.3. Performance responsibilities in universities ........................................................ 11

5.1.4. Accountability of universities .............................................................................. 14

5.2. Benchmarking ................................................................................................................. 15

5.2.1. Procedure of Benchmarking ................................................................................ 16

5.2.2. Indicators for Benchmarking ............................................................................... 17

5.2.3. Success factors of Benchmarking ........................................................................ 18

6. Designs / Frameworks of MCS ............................................................................................... 19

6.1. Simons’ Levers of Control .............................................................................................. 19

6.2. The design of Merchant/Van der Stede ........................................................................... 20

6.3. The design of Malmi / Brown ......................................................................................... 22

7. Management of universities .................................................................................................... 23

7.1. New Public Management ................................................................................................ 24

7.2. Bologna Process .............................................................................................................. 25

7.3. Intellectual Capital .......................................................................................................... 25

14. December 2018 Daniela Zweimüller III

8.1. Contingency theory ......................................................................................................... 27

8.2. Principal-Agency-Theory ................................................................................................ 28

8.3. Stakeholder theory........................................................................................................... 30

8.4. Self-Determination-Theory ............................................................................................. 31

8.5. Connection of theoretical approaches ............................................................................. 33

9.1. Methods ........................................................................................................................... 35

9.2. Grid of article results ....................................................................................................... 39

9.3. Scheme of coding ............................................................................................................ 52

9.4. Descriptive analysis of the studied articles ..................................................................... 53

9.5. Internal factors impacting the introduction of MCS ....................................................... 56

9.6. External factors impacting the introduction of MCS ...................................................... 66

9.7. Internal factors impacting the execution of MCS ........................................................... 69

9.8. External factors impacting the execution of MCS .......................................................... 77

10. Discussion and limitations ...................................................................................................... 84

11. Conclusio ................................................................................................................................ 93

12. Bibliography ........................................................................................................................... 94

13. Appendix ............................................................................................................................... 106

14. December 2018 Daniela Zweimüller IV

Figure 1: PMS: Regulating and controlling process ...................................................................... 10

14. December 2018 Daniela Zweimüller V

Table 1: Selection of articles .......................................................................................................... 36

14. December 2018 Daniela Zweimüller VI

cf. ....................................................................................... confer/conferatur (=compare)

14. December 2018 Daniela Zweimüller VII

1.1. Statement of problem

1 cf. Anthony, R. N./Young, D. W. (1988), p. 3.

14. December 2018 Daniela Zweimüller 1

1.2. Structure of the thesis

4 cf. Bogt, H. J./Scapens, R. W. (2012), p. 454.

14. December 2018 Daniela Zweimüller 2

14. December 2018 Daniela Zweimüller 3