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Since the 1960s, massification has increased the burden of public higher education costs on national budgets of Western European welfare states, while their contribution to higher education came to be considered as strategic in knowledge based advanced economies. The 1980s neo-liberal turn charged universities – as well as many other public services (Ferlie and McNulty 2002; Vigour 2008; Sikes et al. 2001) – for being professional bureaucracies, poorly efficient because loosely ­coupled and self-governed organizations. National governance systems were blamed for not holding national strategic orientations. Higher education reforms have been on the agenda of Western European countries for 25 years. While university systems are deeply embedded in national settings, the ex post rationale of still on-going reforms is surprisingly uniform and “de-nationalized”. They all promote the “­organizational turn” of universities to be rebuilt as autonomous, internally integrated, goal-oriented and accountable organizations.

Reforms were also thought as promoting better accomplishment of the various missions of universities. Better meant at lower costs and more accurately addressing social and economic needs. Diversification of universities with regard to the ­missions of any higher education system – that came to be identified as research, teaching, and third mission – should be favored by local autonomy of choice, orientations being selected according to locally available resources and incentives from various stakeholders – that came to be listed as national and local public authorities, students and their families, companies, etc. It has been debated whether strategic autonomy would bring along diversification or on the contrary organizational ­isomorphism of universities.

How far are the new rules of the game fitted to the (at least implicit) ambitions to diversify universities from world class to local colleges? After reviewing the major formal dimensions of Western European reforms of the last 30 years, this paper will describe and provide elements of interpretation accounting for variability between and within countries.Footnote 1

1 Reforming Universities

1.1 Narratives and Rationale

Reforms of higher education that started in the mid 1980s can be summarized as a mix of decentralization and centralization, enhancing managerial autonomy of public institutions, on the one side, while increasing state control, on the other side. It was based on the transfer of managerial tools borrowed from private organizations, the devolution of resources that were until then managed at the public authorities’ level, and distant steering. The rationale and tools of reforms – amazingly similar across countries – are based on a shared narrative: in order to improve their performance in knowledge-based economies, universities have to be rebuilt as rationalized strategic and accountable organizations by substituting mechanic to professional bureaucracies (Mintzberg 1979).

National reforms developed as endogenous initiatives at the national level. They were also encouraged by the liberal visions of a demand-driven public economy that developed in the 1980s and that were spread in particular by OECD. They were finally impacted by European institutional creations: the Bologna process led to a substantial restructuration of educational function, the European Union funding schemes pushed the networking of academics in research, and the Lisbon strategy imposed the notion of a ‘knowledge-based economy’ as a buzzword providing an economic meaning for change. It enhanced the new idea (Goedegebuure 1993; Van Vught 1993) that the “value for money” of investments in education and research should be measured by their returns in terms of employment and innovation, with the logical implication to link education supply with the needs of the economic system.

Before the 1960s, higher education in all countries mostly targeted general and professional education and training of elites-to-be. The expansion of ­universities that exploded in the 1960s and their role as Welfare institutions favoring ­democratization of knowledge was enhanced. The content and value of higher education used to be taken for granted, as well as the expertise of teachers as producers and diffusers of knowledge. The rise of unemployment, the decline of social deference to professionals, and the later conceptualization of advanced societies as “­knowledge-based societies” converged to shift this producer-based notion to a more user-based approach of higher education. As a result, differentiation between vocational, professional and general education increased. Higher technical education was promoted: it absorbed much of the student number growth and was ­progressively upgraded in full-pledged higher education institutions.

Regulations or incentives developed by the Ministries of education and science encouraged the reorganization of training and research within or between universities, by offering various schemes to incite the clustering of universities, the strengthening of their ties with the economic sector, or the differentiation of their missions based on their local advantages and constraints, with the purpose to rationalize training and research, decrease relative costs by increasing efficiency and economies of scale.

Academic research originally developed inside higher education institutions as a regular and self-determined component of professorship. At the end of the twentieth century, it became a specific mission, with its dedicated budgets, organization and evaluations. The importance ascribed to innovation in economic dynamics brought about increased emphasis (and monies) on applied and strategic research over basic research (Laredo 2007).

These evolutions could not have occurred if not backed by tools to increase strategic capabilities of universities. A central property of formal organizations is to possess the jurisdiction over their own resources, such as human resources and real estate, and the possibility to develop them according to their own strategies. Until recently, no university system in Europe fitted these minimal requirements of organizations. Not even the British ones did so in spite of the traditionally high degree of autonomy of universities. Before the reforms of the 1980s, most continental European universities were ruled from the outside by administrative regulations they had to conform to, that involved administration but not purposeful management. They did not pursue collective goals as formal organizations do (Brunsson and Sahlin-Andersson 2000; Krücken and Meier 2006), their components were loosely coupled silos independent of each other, and they did not control their own performance. With few exceptions, they were funded by public subsidies to deliver free education supposed to offer equal opportunities to all citizens. Hence, their budgets were calculated by public authorities in charge on their ex ante inputs, using some formula accounting for the number, degrees and discipline of students.

From the 1970s onwards, public management developed with the purpose to ensure better “value for money” in public administrations, by deporting micromanagement towards universities, allowing them more freedom to organize and develop strategies, providing tools to rationalize their structures and processes, encouraging them to adjust to national policies by using procedural incentive rules rather than substantive prescriptive ones, and controlling them by evaluation devices. University budgets remained largely based on public money, but a rising share of it came to depend upon grants made available through public calls of funding ­agencies, or upon evaluation of performance in terms of various training and research outputs, treated as quasi-market devices meant to overcome outdated bureaucracy.

2 Organizational Tools

The toolbox of the reform included the usual kit of formal organizations, dealing with human resources, funding, budgeting, cost accounting and internal auditing, real estate and equipment matters.

2.1 Human Resources

Various models of university human resources administration share the floor in Europe. British universities have always acted as employers of their administrative and academic staffs. Almost everywhere else, academics were civil servants and position openings were decided at the State or regional level. Recruitment and promotion were the responsibility of national committees in certain countries; universities – or a mix of both – were in charge in others. National or regional scales ruled salaries and promotion.

As reorganized by the new forms of public management, the power to open positions and hire was devolved to universities, according to rules that may be rather complex and restricted in the many countries where civil service status were maintained. Even though civil servants and tenured positions still largely prevail today, the proportion of academics and administrative staff under contract with the ­university increases everywhere as well as the share of market-oriented salaries. Altogether flexibility of human resources has increased, based on temporary teaching contracts, fixed-term post-docs, part-timers and adjuncts, etc. It is not that new that short time contracts fill the lack of permanent recruitments, but public management provides a new rationale for it: flexibility favors adaptability, competition and attractiveness on an increasingly internationalized labor market. External and non-national recruitment may become a signal of quality, so that increased mobility may become an issue for institutions or disciplines facing difficulties to teep their academics leading countries or universities to develop specific programs to stabilize newcomers or to incite the return of brain-drained nationals (Metcalf et al. 2005).

2.2 Funding

Diversification of financial resources became very incrementally an issue for ­policymaking agendas. It was at first a pragmatic way to counterbalance the reduction of government contribution per student, which was progressively rebuilt in a rationale stressing the virtuous impact of stakeholders’ contribution as a way to ­better fit supply of education to demand.

The relative restriction of direct research funds was a consequence of the rising competition for resources inside the public sector. It also resulted from changes in the vision of how allocation was to become more virtuous and efficient: research teams and universities should deserve these funding by competing for funds. Allocations of funds should also help solving identified economic, technical, and social issues. Thus, national, European, and local funding sources were increasingly considered as a major allocation technique, especially in research.

Tuition fees – a very hot issue – started to grow in some countries at the end of the 1990s, also based on the idea of sharing the burden of costs of higher education as its return went both to national economy and to individuals.

Regions also appeared as potential sources of diversification as university mass tertiary education, vocational training and applied research could contribute to local employment and economic dynamism. Public authorities often created new schemes to encourage regional contributions to national public service mostly on the basis of competitive grants. Regions would also develop their own policies, not only in federal countries where regions are historically in charge of universities, but also in most large countries which experienced since the 1980s some devolution of powers.

Companies were also targeted as potential sponsors of training and research programs that could feed executive education as well as specialized research responding to the innovation need of local districts, widening the so-called “third mission” of universities. In all countries, public authorities have set up various instruments – agencies, joint private–public innovation programs, new types of joint private/­public legal schemes, tax deductions for investment in public or private research and innovation, encouragement of the development of company chairs in higher ­education institutions or investment of venture capital in “by-products” such as students’ residences, etc. – to promote innovation in or with universities. Yet, in all countries, the average private funding of universities has remained marginal, with a large variance across universities (Lepori 2008).

Nevertheless, most education funds remained allocated on the basis of students’ numbers, with strong historical inertia, while the increasing share of performance-based allocation in research did not lead anywhere outside UK to remove traditional criteria. But, in association with the development of strategic planning encouraged by mission statements and multiannual contracts, it contributed to irrefutable differentiation.

Diversification meant achieving a better fit between resources and missions, thus a more incisive characterization of universities in training and research. In other words, diversification of funding also meant diversification of universities with resulting effects in terms of disciplinary specialization (especially in small countries) or emerging differentiation between those universities which were meant to become research vs. teaching-oriented.

2.3 Budgeting

Besides encouraging resources growth through diversification, public authorities became convinced that rationalization of the production process was needed in order to reduce costs. Reforms were to eliminate weak efficiency in professional bureaucracies. This implied important innovations to sustain strategic behavior by building instruments to inform objectives, rationalize allocation choices, allow diversification and provide insight into the use of resources.

Universities historically provided a rather uniform public good in higher education with rather uniform means decided by ministries in charge. Hence, budgets were itemized and dependent upon various rather hermetical silos. The lack of budgetary autonomy echoed the collegial vision of universities in the framework of (national or regional) administrations. They were not considered as problem solving organizations nor were they strategic actors free to allocate and manage their own resources according to their own strategies. They were the last step of a top-down administrative ladder that took advice from the ­academic communities in various institutionalized committees. Core budgets were most often computed through student numbers based formula, in which parameters took care of differential costs of education along disciplines and steps in the curricula. They did not differentiate teaching from research and considered quality of teaching or research only by ex ante accreditations they most of the time delivered themselves by consulting ad hoc committees. Funding of functional departments and real estate was itself based on line-item budgeting. The budgetary allocation process left no room to university strategies: budgetary inputs were based on central bureaus’ definitions of local needs and expenses, and they were submitted to ex ante controls of legality. Universities had no much choice but passively registering and spending input monies with the obligation of balancing each item.

Over the last decade, itemized budgets have been substituted by lump-sum ­funding and global budgeting at the university level. Financial resources were transferred from the state to universities. Global budgets were credited under large chapters – typically public salaries, operations and investment. Expenses were usually free within the global budget, except for a ceiling limiting global public salary costs and various obligations dealing with public regulations. This process usually came with the introduction of indicators, incentives and evaluation, with the ­purpose to better articulate allocation and performance.

2.4 Cost Accounting and Internal Auditing

A decreasing number of universities still function with accounting schemes that are characteristic of professional bureaucracies. Global budgeting and management decentralization require (and allow) shifting to cost accounting and ex post control of each individual university as a whole. The share of full costs of the whole ­organization dedicated to each of its components can be computed. Cost accounting creates transparency and commensurability of investments, allocations and returns. It carries along an ideal of rationalized formal organization. Each strategic action can be evaluated by comparing full costs, its expected returns (in terms of publications, patents, public goods delivery) and accepted risks.

The shift to cost accounting was usually complemented by internal and external audit and assessment systems which first and most extensively were created in the 1980s in the UK with the well-known British Research Assessment Exercise. Cost accounting drew universities towards a more managerial culture by developing a norm of accountability, where global revenues must cover global costs and be understandable in terms of organizational strategy: therefore, every action can be evaluated through its outputs. Cost accounting also informs on all internal interdependencies within the organization and can be used as a tool for internal audits. Hence, it requires internal political leadership to settle which options are going to be taken considering short-term returns as well as middle range strategic investment.

2.5 Real Estate and Equipment Matters

Most universities in Continental Europe did not own their buildings until quite recently. Depending upon the degree of actual delegation to universities in decision-making on construction and administration, consequences could be more or less unfortunate. In certain cases, universities were not even allowed to create provisions for depreciation in their budgets. Things have now changed in most countries, where all real estate has been devolved to universities or are in the process to be. More private property is also allowed and schemes bringing in private monies and management in university buildings develop in several countries.

3 Governance Tools

3.1 Internal Governance

3.1.1 From Weak and Subordinated Organizations…

Shifting from administrative bodies to strategic actors requires as a key initial ­prerequisite to reinforce individual universities’ internal steering capabilities. Whether they benefited from a large degree of autonomy as in the UK or they were directed by a large number of laws defining detailed substantive rules implemented top-down by Ministries in charge as in France or Italy, universities came to be ­conceptualized during the two last decades of the twentieth century as loosely ­coupled professional bureaucracies (Cohen et al. 1972; Weick 1976) lacking major properties of formal organizations such as strong principal agent relationships.

On the continent, the roughly common pattern was based on dual leadership at each organizational level, where administratively appointed staff shared the floor with elected academic leaders. Their respective jurisdictional divide was often unclear, in particular at the top level. While administrative staffs were small in numbers, weak and formally confined to operating bureaucratic rules, it might occur that the head of administrative staff gained much power by handling relationships with the ministry and politicians. It might also happen that elected academics captured the floor even though their authority was limited. Yet neither of them usually had much strategic leadership capacity since they both lacked the tools of strategic decision-makers. Consequently, presidential functions were usually restricted to public relations and internal consensus building across disciplinary powers. Rather than a CEO heading a big organization, the President or Rector, usually backed by an elected governing Board, was an institutional integrator among colleagues rather than a boss. Major decisions were taken by faculties or prominent professors often in direct interaction with the Ministry, discussed in Scientific boards acting as elected non executive university councils and ratified by the executive Board.

In countries where university structures were the strongest, leaders were more often appointed than elected. Nevertheless, appointment was most often a confirmation of the nomination by the university. Leaders worked in close connection with the Ministry of Education. Being appointed, they had more power to buffer the relationship between disciplines or faculties and the Ministry. They might even succeed in building national associations that mediated the relationship between academic institutions and public authorities.

3.1.2 … To Emerging Formal Organizations…

The development of organizational tools helped reinforcing the organizational density of universities. By strengthening leadership and senior management and by internalizing arbitration and decision-making, the rise of self-government tools attempted to increase the subjective and objective belongingness of university members.

In several countries, leadership was first strengthened by the repudiation of the notion of academic collegiality and election rules of Presidents or Rectors that came with it. It led to concentration of power, weakening of the representative bodies, and increased power of the managerial hierarchy based on strategic planning. Presidents or rectors became principal negotiators and inescapable gatekeepers for reaching the outside world of Ministries and stakeholders (see Chap. 33 by Pechar and Chap. 35 by Amaral et al.).

The introduction of management instruments also enhanced the role of senior management: on the one side, they tended to explicitly place faculties under scrutiny of new instruments measuring performance; on the other side, they sustained the professional claims of an increased numbers of qualified managers. As a ­consequence, power came to be redistributed between presidential teams and senior management on one hand, between management and academics on the other.

3.1.3 … Based on Strategic Planning

A common feature in all countries is the promotion of strategic planning at the level of individual universities, most often as a basis for negotiating the allocation of resources, using university contracts as in France or mission statements as in Germany. At first, budget shares related to the negotiation of such plans may have remained limited and the impact of ex post evaluation on next year’s budgets weak. But they have constrained universities to make plans before budgetary negotiations, stimulating identity assertion, development of common frames for internal operation, external communication and elaboration of prospective visions of their future, and finally opening the way to the building of a shared interest by negotiating ­institutional projects. They have often led universities to get a better knowledge of their internal landscape and external networks, of their strengths and weaknesses, of their actual and expected resources and performance. Therefore, much more than technical tools, they proved to be governing instruments with structuring effects on the higher education system organization.

3.2 External Governance: Steering at a Distance

Steering tools have a double face. They strengthen the internal strategic capability of universities. They also enable ex post external evaluation of performance by scrutinizing outputs and budgetary efficiency. Thus they are ambiguous. On the one hand, they afford a common language of accountability that may serve internal steering and strategic autonomy. On the other, they serve relationships between national policies and universities as potential fabrics of strategies. Altogether, these tools help articulating centralized steering by public authorities and decentralized micro – management in the universities.

3.2.1 New Funding Tools, New Allocation Models

Public funds remain largely dominant in university budgets of all countries, even though private contributions to funding have more than marginally increased. The major innovation is more to be found in the restructuring of public money allocation methods than in changing sources of funding. The striking common feature in all countries is the development of public competitive centralized basic funding, its dramatic rise in volume and share even though it has not replaced the large input base of public funding, and the separation between research and teaching funding. Departments and research centers are encouraged to look for competitive public money, with possible incentives in terms of teaching loads, positions, salaries, fringe benefits, promotions, etc.

The rise of competitive money came with the diversification of funding tools and the development of coordination mechanisms of steering functions between local and national authorities and between branches of government, and the generalization of the notion of public agency as a funding institution.

3.2.2 Indicators

The share of competitive money won by departments or research centers contribute more and more to their evaluation and public allocation of resources, based on more or less complex measures of performance. Indeed, as a counterpart of increased autonomy, public controls of legality and efficiency are shifting from ex ante to ex-post. The assumption that resources dedicated to carry out public services were accurately allocated through vertical channels from Ministries at the top to delivering agencies such as universities comes gradually to be contradicted in the on-going process of rationalization.

Indicators may be built and used in various ways in the external steering process. They may either be imposed as a top-down rule, or by negotiation at the level of each individual university or even of each research center or teaching department. They may be imposed as steering tools through quasi-market mechanism strictly coupling resources to ­performance in a principal-agent perspective, by linking impersonally and non-ambiguously central resource allocation to a complex measure of output. They may back up the allocation process in a much looser manner, by contributing to build a set of multidimensional strategic tools anchoring strategic debates within universities as well as between universities and their stakeholders. In all cases, they aim at providing visibility and accountability of universities in terms of costs, performance and efficiency. Whatever their characteristics, indicators obviously carry the hopes of governments (and, in a fractal process, of university leadership) to increase transparency by building systemic information, and to monitor coordination between university strategies and national or regional policies.

3.2.3 Assessment, Quality Auditing and Ranking

Assessment and evaluation of careers, curricula, research, universities, etc., are an old story in several countries. Auditing emerged in the mid 1980s and spread in the 1990s, as a standardized process largely forced from the outside, with little cooperation from inside many higher education institutions (Perellon 2003; Schwarz and Westerheijden 2004). Over the last two decades, internationalization of teaching programs combined with rising competition for international students have generated new international accreditation agencies assessing quality of degrees on a voluntary basis. As it was explicit in the 2003 and 2005 follow-up conferences, the Bologna process reinforced the need for national evaluation and accreditation agencies to build comparable degree structures which have been built in several European countries. Altogether, assessment and audits contributed to the organizational turn of universities over the last 30 years, by nurturing identity and strategy building.

4 From Formal Tools to Implementation

Recent reforms of higher education in European countries share a common repertoire of reform instruments that aimed at developing a new pattern of governance in public institutions, based on three principles, usually (even if abusively) summed up under the banner of New Public Management. (1) Decentralization of micro-­management at the bottom-line level of universities, sometimes understood as a downgrading of universities from knowledge institutions to “productive organizations”. (2) Centralization of distant steering by public authorities based on a ­retroaction loop between central incentives, performance measurement and funding. (3) Fractal expression of this pattern from the top level of public authorities to the bottom-line of universities: at level n, universities are to public authorities what departments are to universities at level n − 1. The narrative of reforms was most often built and clarified incrementally in their process and ex post rationalized in principles justifying the creation of steering and management tools actually invented incrementally or transferred by benchmarking.

This governance pattern implicitly or explicitly enhances the virtues of quasi-market regulations in bureaucracies as compared to collegial ones (see Chap. 29 by Middlehurst and Teixeira and Chap. 30 by De Boer and Jongbloed). It aims at substituting the prevalence of quasi-clients to the sovereignty of the supply-side on the determination of which outputs – research, curricula and service should be selected. Yet observation of reforms implementation provides evidence that such a program never proved that radical, nor brought along uniform changes. This section explores variations across and within countries and provides some elements of interpretation.

5 What Observation Tells Us

5.1 Diversification and Concentration of Universities

Before the reforms started, public European universities visibility differed within the same country, in spite of the fact that they were generally placed under the same national regulations and were expected to fulfill the same missions. Reputation was what made the difference. It brought back to the historical splendor of Europe, without telling much about what was to be found in the black box of universities as organizations. Some timid structural differentiation started in the 1980s, when funding became less unconditional and a bit more competitive in one way or the other.

Certainly, the hidden agenda of reforms included clarification and differentiation of university missions as well as concentration of research resources, based on ­several assumptions. (1) The growth in number and size of universities since the 1970s was based on education rather that research. It mechanically induced the development and dissemination of research forces, very unequal though in terms of their quality. (2) All universities cannot pretend to be research-driven and yet, all are submitted to uniform rules regarding recruitment, funding, management and governance. (3) Research costs increase while relative public budgets shrink and are ­allocated without consideration of their productivity in terms of research outputs. (4) Because money becomes relatively scarcer, it has to be directed, not only towards good research teams, but also towards the highest priorities in science as defined by policy-makers enlightened by scientific elites (5) Therefore, universities organization should be given the possibility to diversify, because what is good for research is not necessarily good for undergraduate teaching, or service to the local communities, etc. (6) Concentration of resources should be favored since resources attract resources (Merton 1988/1968), as demonstrated by the huge success of American research universities after World War II (Graham and Diamond 1997; Picard 1999). The influence of post World War II dominating scientific elites contributed to deeply root this vision in policy-makers minds, even though concentration in US research money allocation form the 1950s to the 1970s was followed in the 1980s by more dispersion across more research universities, also as biology became more of a priority implying lesser costs than nuclear physics (Graham and Diamond 1997; Geiger and Feller 1995).

Based on this agenda, national as well as European public authorities developed increasingly elitist schemes of research money allocation in the 2000s: more money for fewer teams; more money for prioritized domains. It was the meaning of the creation of new competitive schemes developed under the umbrella of national research agencies and European framework programs. This process was accelerated in the 2000s with a whole range of schemes increasing selectivity and allocation amounts for the happy few at the national level – such as Excellenz Initiative in Germany, various schemes culminating in the “Investissements d’avenir” in France – and at the European level of the ERC with for instance Excellence chairs. All this implied that universities should not only run for the best, but also that they develop organizational efforts to carry their best teams’ applications and manage the big amounts of money they might win. In other words, competition for resources translated into rising differentiation between scientific and teaching activities, but also in organizational densification of universities when they ambitioned to become or remain part of the elite. It also tended to undermine the status of teaching as a second range activity, with on-going impacts on the fragmentation of academics identities (Henkel 2000).

Indeed, observation shows that in all countries differentiation comes progressively to rely more on strategies and less on status, even if there is still a long way to go since status remains as such a strong source of attractiveness with the consequence to favor winning strategies. But, until now, implementation of reform has not led European higher education systems and universities within each of them to converge towards a unified pattern that would progressively erase borders with the help of European level policies and intergovernmental actions. Major changes are on their way, but they exhibit international as well as intra-national differences in terms of dynamics and acceptance: the same supply of values, norms and rules provided by reforms induces different impacts from one country to the other, but also across universities in the same country.

5.2 International Variations

Change did not develop at the same pace and did not follow the same path in all countries. The reason is threefold. First, financially and politically, reform was largely resource driven: reformers determination was very much linked to how urgent they felt the problem was, and what corridors of political action they felt were open. Second, action was incremental (Lindblom 1959) rather than ex ante planned – with the possible exception of the UK – as we amply exemplified in our recent exploration of reforms in seven Western European countries (Paradeise et al. 2009). Its development was constrained by local conditions in the organization of central public administrations and universities as well as the reactivity of academics as a profession, so that reformist intentions tended to be brought back into traditional national trajectories. In many countries, general legislation would typically pile up without offering operational tools efficient enough to rearrange power positions. Third, in most countries, foreign experiences were either ignored or rejected as inadequate.

The impact of the development of a ‘European space’ on national reforms came quite late. Benchmark and diffusion effects certainly increased with the role of EOCD, with the development of the European dialogue in associations like EUA, during EU working groups, in agencies such as ENQA, or thanks to intergovernmental processes on higher education and research. Benchmarks have become an explicit part of the Bologna process, the EU’s Lisbon strategy and the Open Method of Coordination. They have also been favored by the huge development of international rankings that – out of states control – put national systems under pressure of international competition.

Two broad groups of countries can be distinguished, cutting across the usual typology used to characterize European universities which opposes the internal consistency of British and “Humboldtian” individual universities in Northern Germanic countries to the vertical dominance of the nation-state in the Southern “Napoleonic” ones. The first group includes early movers, UK starting at the very end of the 1970s (Ferlie et al. 1996; Ferlie and Andresani 2009) and Netherlands in the 1980s (van Vught 1989; Westerheijden et al. 2009). The UK early on systematized the rationale of reform and was imitated a few years later by the Netherlands. Although the Netherlands was less efficient in implementation, both countries went far and strong in reorganizing forcefully and systematically the entire multilevel governance system according to a general reform plan. The second group includes countries severely burdened by massification and budgetary limitations in the 1970s (France, Germany, Italy) (Musselin and Paradeise 2009; Schimank and Lange 2009; Reale and Potì 2009 and Chap. 32 by Moscati), as well as countries where a lower degree of massification induced less of a financial burden (Bleiklie 2009; Baschung et al. 2009). These late or slow movers developed mostly incremental approaches to reform. They used bits and pieces of a global instrumental repertoire or even reinvented parts of it.

Thus, the degree of advancement, speed and processes enacted to deploy the reforms, as well as the manner in which they have been taken up, varies enormously from one country to another. Ultimately, while the academic landscape has definitely changed, the picture is one of strong international diversity, a long way from the homogenized vision of convergence theory. Next section suggests that diversity is not only international but also intra-national.

5.3 Cross-Country Variations in University Acceptance of Reform

Moving down from the macro-level of states to the meso level of universities, observation exhibits considerable variations in the way universities engaged in reforms, based upon their historical power relationships with public authorities, and their internal working arrangements across disciplines and with managerial actors. Some seized upon the available tools of internal reform as new development resources, others put up with them as mutilating constraints. Hence, three decades after reforms started, empirical analysis of the way universities actually position themselves in their day-to-day management demonstrate that they are not passive agents subjected to the demands of an exogenous principal, but more or less autonomous actors pursuing more or less consistent ends, trying to use resources and faced with constraints.

Four types of universities distinguish according to where they stood ahead of reforms and to which degree, as a social system, they have been supportive of reforms and able to take advantage of new tools and schemes to position on university missions (Paradeise and Thoenig 2011).

5.3.1 Top of the Pile

The top of the pile gathers some extremely prestigious international institutions consistently placed over time at the very top of universities in national and international benchmark, either in terms or formal excellence as expressed in rankings or in terms of informal social reputation. Even when new forms of evaluation are used, they appear not to have to make any great effort to stay at the top of the status-related pyramid. There is not even a handful of them in Europe and they are concentrated in the UK. Their leadership would appear to be protected by a sort of ongoing benefit that they reap from their situation. They are prestigious and excellent in equal measure – paragons of academic virtue (Nedeva 2008).

They rapidly adapt to national and international developments in quality-based judgment criteria and developments among their key publics by juggling between basic and applied research, providing training at various different levels and ­engaging in disinterested and commercial leveraging of their products. While their performances are also evaluated by key external stakeholders, they are able to efficiently pay close attention to the manner in which they endogenously produce and maintain the sources of quality that underpin both their prestige and their excellence.

5.3.2 Wannabes

Higher education institutions may have attained genuine local or national prestige and suddenly disappear from the radars when compared on a set of formal international and/or national indicators: too small, insufficient focus on publications, insufficient exposure for their offering, teaching staff not cosmopolitan enough, low degree of international attractiveness, etc. They may as well have remained out of sight of reputation radars in spite of decent outputs for instance because they are newcomers. Wannabes consider reforms as an opportunity to convert – as quickly as possible – their national prestige capital into international formal excellence, or simply to emerge on the globalized scene, by using organizational and political resources embedded in reforms and oppose their actual performance to socially long established reputations (Porter 1995).

To improve their position, they stick to reforms by playing the rules and gluing on formal assessment indicators used by their principals. They pour all their energy and resources into boosting their performances according to the standards laid down by the league tables currently in vogue or the indicators basing public authorities funding decisions. They deploy radical upgrading strategies to rebuild in a way that involves clean breaks with their past notwithstanding their effects on their internal social structure and the nature of their outputs. They do not give much thought to their university as a social institution with its specific affectio societatis, often because they do not see any way out of the logics imposed by their changing conditions of action (Tuchman 2009).

5.3.3 Missionaries

The missionaries actively disapprove on-going reforms. In their opinion, they promote the mutation of universities from professional to mechanic bureau­cracies, by de facto reinforcing centralization of the higher education and research system while they pretend to decentralize and redistribute power. They increase heteronomy of research and education orientations under cover of rising managerial autonomy of universities, hence downgrading academics to knowledge workers and perverting the very notions of free research and education (Christensen 2011).

As wannabes, they believe in the straightforward efficiency of reforms, but in opposition to them, they denounce this drive as a dangerous one. Instead of joining the game, they claim to resist its rules. Prestige is a not a relevant issue. Content matters more than signal. The pursuit of excellence based on impersonal and a-contextual criteria can only exacerbate costly competition in exchange for dubious social benefits, increase inequality, hamper the integrative mission of education and ultimately say little about the intrinsic quality of their activities.

They see universities as institutions in charge of public service missions carried out by personnel subject to the same status and regulations and offering same-type services in a spirit of selflessness. They sing the praises of the continuity of the public service function of higher education and refuse to consider education as the “dirty work” of academia whose noblest elements are given over to research. They disregard indicators as management tools as they consider them as a way to impose exogenous definitions of academic work as well as its exogenous evaluation, failing to take account of the different missions academics are in charge of, depending on their publics and disciplines.

5.3.4 Venerables

The venerables enjoy considerable local prestige and are loathe playing the whole “excellence” game, which they deem to be absurd given the singular nature of all academic institutions. Unlike the nouveau riche wannabes who seek to win status within a larger space by converting their prestige into excellence, the venerables behave like an established aristocracy whose prestige reflects an intrinsic quality founded on history and carefully preserved by the wisdom of the academic corps. While they are well aware of the exogenous criteria driving comparisons between universities, they remain splendidly aloof or overtly hostile. They deem such comparisons to be unfounded in epistemological terms and to undermine their own institutional integrity. They counter this bean-counting logic of the uninitiated – journalists, bureaucrats, international institutions, etc. – with the capital of a prestige built around the preservation of a collegial approach to producing knowledge and a ­quality they consider to be intangible. The initiation rites for new entrants to their exclusive club that keeps outsiders at a distance ensure pacific coexistence and cooperation between equals rather than the competition that is rife in the world of the wannabes. Venerable institutions are founded on the elective affinities between elites who are disdainful of conventional academic ideas and confident of the intrinsic value of their products – publications, courses, diplomas, etc. – and of the vulgarity of competition. They give little thought to how relevant their content is for their public. Unlike the wannabes who bend over backwards to meet all excellence-related criteria, the venerables are resolutely attached to an offering whose quality they and they alone are qualified to judge. They attempt to counter the fallout from any policies likely to challenge their traditional pre-eminence in their own field, particularly the introduction of performance analysis tools that could undermine their status and their ability to sustain their social network, with the risk of being downgraded for not being accountable.

The next section provides some interpretations of diversity by underscoring a series of factors that contribute to build each case as a specific one, depending on how reform hits its formal structures (internal organization, relation to public authorities), its administrative culture and its underlying norms and values, and its technical and institutional environment (tools sustaining per­formance and visions embedded into models, prescriptions and standards) (Christensen 2011).

6 Accounting for Variety

6.1 From a Macro-determinist Vision to Local Orders

Macro-determinist interpretations of change are based on the vision of an iron cage dynamic process. A single framework is postulated to impose its global hegemony that is driven by incentive and remote control processes, that is promoted by external bodies and is postulated to be applicable to all local actors. All stakeholders in a given domain are thereby supposed to refer to the same body of normative and cognitive standards, thus resulting in identical practices in all local spheres within a relatively short time. As tempting as they may seem at first sight, such interpretations obviously do not fit observation that exhibit inter- and intra-national variations in pace, methods and extent of implementation of reforms that nevertheless share approximately the same rationales and tools. Even though they have much in common, reforms remain path dependent and most often incremental: patterns imposed from the outside by coercive public authorities combine with renegotiation between public authorities, universities, academic professions, and civil society at large. The concept of local order helps (March 1962) grasping the instrumental dimension that characterizes the actual organization of resources in a given space of action rather than the impact of incentives per se.

Thus, a national higher education and research system – as well as a given university or a given component in a university – can be considered as a specific social space, in which actors manage conflicts between different approaches to which they are subjected on a day-to-day basis, building up their resources by leveraging different, extremely diverse environments at different times (Serow 2000) and valuing various perspectives – serving this local community, serving distinct national job markets, being ranked as an international scientific body, simply continuing to do their own thing, etc.

The basic tenet of such an approach is that resources are built up by concrete organizational arrangements that affect performance processes and levels. Local orders are forged by action and may be analyzed in terms of the fit between decisions taken at various levels of higher education systems, not all of which simply follow on mechanically, one from the other. Thus, diversification may be a result of unequal ability, interest or will of individual universities to capture new norms and rules as strategic resources. Some will treat new rules as formal administrative requirements forced upon universities by bureaucrats, thus refusing to make sense of the new organizational tool offered to them and, by the same token, weakening their position in terms of accountability. On the contrary, others will use them as internal resources to enhance shared identities among university members and to sustain legitimate global organizational strategies, thus appearing as responsive and accountable from the point of view of new values, and deserving more delegation of resources or better allocation of money.

6.2 Implementation of Reforms: Macro-level Structures

Organizational structures and resources frame the action-set and social-economic space in which universities can move. Despite the common identity of the basic repertoire, variations in political, technical and social environment of reforms express path-dependency of national trajectories as well as they prolong them. The drive to move of each actor of the higher education and research system – central administration, the academic professions and universities – is conditional to the preexisting distribution of power between them and their alliances with prominent actors in the political system at large.

6.2.1 Anticipations and Implicit Social Negotiations

All countries provide many good examples of how local interpretation may lock intended reforms into national paths. The basic cybernetic loop linking incentives, performance and awards was and remains quite weak in many places. In several countries, direct basic public funding long remained disconnected from evaluation or the share of performance-based funding remained limited and had only very indirect influence on supply. Funding formulae were transformed to incorporate a proportion of performance-based budgeting but its share varied enormous across countries, from very small to half of the global allocation. Decision-making competencies of rectors and deans have been extended in many countries, yet academic self-governance remains very strong in most, because daily operations are based on informal long lasting and non-hierarchical peer relationships. The rise of competitive money is advocated as encouraging excellence, but it also implies heavy costs of reorganization and maintenance within universities, which it takes time and internal authority to achieve. Differentiation by excellence may induce counterproductive effects such as demoralization and stress among teachers devalued by this increasing emphasis, so that public authorities may act carefully in anticipation of unionized resistance.

Hence, old patterns seem often to reassert themselves and slow down the process of planned policy change, taking advantage of situations characterized by localism and incrementalism. Path dependency is in control of change dynamics. Research programs may be developed, but so vaguely formulated that they can catch in a harmless way all disciplinary traditions and interests. Peer review can develop some tricks as a protection against outside interference threatening the established distribution of power within academia. On the other side, it also happens that central administration, under the pressure of scientific or political lobbies, interferes more or less openly with peer judgments to protect such or such project. Thus, slow adaptation seems to be the rule in most countries, both on the side of central authorities, academic professions and higher education organizations.

6.2.2 Public Service Culture

Variation relates to national visions of desirable change, political voluntarism and capability to shape rearrangements of power distribution within universities, and between the universities and their stakeholders. National dominant cognitive frames also play their part. The Benthamite British political and social philosophy clearly helped promoting reforms based on economic views of society, where quasi-markets and principal-agent relationships appeared to be the best substitute regulatory instruments to bureaucracy. The economic crisis in the UK also bolstered the will to undertake radical innovation, with huge consequences that broke the path dependence built into a century long history. Continental European Welfare states have been more reluctant to deregulation by the market, fearing that competition might be, at the end of the day, more destructive than regenerative, and very costly in terms of social unrest.

How public servants were linked to the outside world is also of much importance on their ability to learn lessons from foreign experiences. In most European countries, in particular the largest ones, they long remained largely isolated inside self-sufficient frontiers. They sometimes came to invent their own solutions, discovering ex post, sometimes many years later, how similar they were to the ones used elsewhere.

How reforms position has also to do with the degree to which civil servants in the administration of higher education and research are interweaving with the academics profession and academic national and international elites (Whitley 2008; Edler et al. 2012). Where the link is very strong and long-standing, the administration is very likely to so to speak become an hostage of specific academic lobbies well connected to political power arenas, as often is the case in fields such as law, medicine or economics. In such cases, conflicts on the front stage of administrative organization and tools often hide backstage conflicts on the redistribution of power between national scientific elites.

6.2.3 Regulatory Traditions and the Strength of the Academic Profession

Academics may be hostile or enthusiastic towards reforms (see Chap. 32 by Moscati and Chap. 33 by Pechar). Most of the time, they are ambivalent. They fear that organizational-based reform weakens their professional identity, as if organizational and professional strength were necessarily mutually exclusive. As noticed by Freidson (2001), the capacity of professional social regulations to counterbalance bureaucratic authority or the law of the market is very uneven across countries. They more easily play the role of alternative regulations in countries where public authorities are coordinators rather than they exert a hierarchical authority (Paradeise 2011). In the first case, they coordinate with existing professions to make and ­implement decision and develop reactive and procedural policies, while in the ­second one strong administrative bodies impose decisions in an interventionist ­perspective embedded in substantial policies.

The reforms in process are supposed to handle asymmetry between administrative and organizational actors by relaxing the domination of the administrative hierarchy on organizations and professions, so that each partner may gain based on a symmetrical relationship maintained by negotiation between equal players. But this would suppose that public authorities actually move from substantial to procedural rules in all their fields of action and effectively transfer their control over resources to other actors, for instance international scientific elites as far as competitive allocation of resources is concerned. It would also suppose that managerial and academic components of universities find some way to institutionalize internal checks and balance. Achieving organizational and strategic autonomy of universities requires the withdrawal of strategy-driven administrations from finicky rules that secure their on-going control.

6.3 Implementation of Reforms: Meso-level of Universities

Relaxation of tight bureaucratic substantive rules allow for strategic diversification of individual universities, while the expansion of incentives built into procedural rules may encourage institutions to imitate the new structures introduced by pioneering institutions. Actually, both trends can be observed. On the one hand, the requirement to build a profile according to a specific strategy in mission-based ­contracts often leads universities to try to copy those that are seen as especially successful (DiMaggio and Powell 1983). This trend results in the repetition of strategic orientations from one individual university to the other, so much so that research programs at all levels, from regions to country to Europe, encourage repetitively the same fields of specialization. On the other hand, diversification is rooted in direct efforts by public authorities to increase specialization of universities in terms of concentration of resources in specific disciplinary or functional activities.

Until now, we have simplified our argument on universities by considering them as internally homogenous. But they are themselves loosely coupled social systems. At best, they articulate one organizational agenda with multiple academic agendas. As a totality, they thus have to fit into several reference frames: the first ones link faculty members with their scientific communities; the second one links faculty members with each other across disciplines within the university as an organization.

This double requirement is rarely satisfied. The various components are unequally strong to impose their vision or to compromise with others in the organization. It can be argued though that top of the pile universities described above own a social capital that enables them to benefit from a productive tension at a very high level between the professional and administrative spheres on the one hand, and the individual and collective spheres on the other (Paradeise and Thoenig 2011b). They can act as “agile elephants” because they can face a strong drive for administrative rationalization without shackling strategies based around a professional approach; they have explicitly incorporated professional standards into their organization and safeguarded them by their internal governance, avoiding common bureaucratic scourges such as rampant centralization or silo effects. They benefit from long-lasting effects of diverse material and institutional resources that consolidate their internal instrumental quality without destroying their assets as institutions based on shared values and negotiated compromise on major issues, while they can respect the quality regime of each discipline. Shared and often implicit rules regulate the room for maneuver and content of roles vis-à-vis the centre and the grass roots, and between the administrative and the academic spheres. They can focus at length on developing and enhancing their – already excellent – internal institutional arrangements and forge a virtuous circle in which their instrumental quality bolsters their status-related quality. There is a legitimate means of social regulation based around rules that underpin shared knowledge and a space for common interpretation of situations. There is also strong pressure to act collectively on the different components, departments, research centers and members of the academic corps, because the inconsiderable resource of a recognized brand also entails an obligation to produce a result that, aside from formal obligations, is based on a shared perception of a moral duty to contribute to the collective good and maintained by practical rules that make sense for the academic corps concerning the allocation of research subsidies, the creation of chairs or promotion of the establishment’s reputation. In other words, these universities are well managed, internally integrated around common scientific and managerial values but respectful of their internal diversity. Their reputation and their wealth make them very attractive for stakeholders, which in turn bring them more resources. They do not really fear reforms because they can take the best of them, especially in terms of resource concentration, while their internal organization and external reputation protects them from the risk of managerialism.

At the other extreme of the spectrum one finds universities that are weak on both dimensions of professions and organization. It is often the case of “missionaries”, where management is relatively undeveloped and is not given much consideration, hierarchical authority is poor as it is suspect of being abusive and organizational structure juxtaposes specialized professional silos, each differentiated around a specific domain with very little direct spontaneous inter-component cooperation. Apart from tinkering at the margins, the central hierarchy struggles to arbitrate between different missions. Hence, any strategic change is perceived as a risk both in itself and for the institution. It makes it very difficult and sometimes impossible to redeploy resources on the basis of strategic arbitration as this is seen as a major infringement of the professional values. A tacit acceptable goal is for everyone and every component to keep on doing what they do. Components evolve in a context of ­affective power relationships that veer between trust and mistrust. This produces relatively opaque forms of decision-making and the collective is subject to centrifugal forces. Priorities are formulated by ‘localist’ professionals, whose references are endogenous to the local institution. Their power resources come from local experience that is not easily transposable elsewhere and who devise ad hoc expertise and solutions in local functional networks. Each person or group has one’s own internal field of action, one’s own local network and its own agenda. Egalitarianism is a basis of instrumentation that gives everyone equal priority in terms of treatment, even though subtle or informal differences can creep in as this allocation process does not specifically refer to selection criteria – as if one priority was just as important as any other – while allowing for the perpetuation of specialist niches accorded a large degree of de facto functional autonomy. The weakness of collective governance precludes the spontaneous emergence of any strong bargaining process that would be tolerated by mutual consent. Consequently, instrumentation increases the establishment’s degree of disconnection, reduces its ability to keep pace with developments in society and in education and research demands.

Cumulating poor management, weak internal and external integration, little scientific recognition and faculty members essentially dedicated to local teaching and service missions, such universities are defenseless in front of reforms. They lack strategic agility and they lack top publications. The most research-driven faculty members are internally perceived as not enough committed to the “real issues” of teaching and administrating day-to-day activity. They are also perceived threatening in terms of internal allocation of resources and organizational restructuration. And they are seen as arrogant members of the organization who prefer to work with doctoral students and colleagues abroad rather than sustain the humble and equalitarian mission of their own university.

Taking advantage of reforms is thus very difficult for such institutions, even though their presidential team may try hard and strengthen its management, because prevailing informal arrangements deeply embedded into the internal organization fade ambitions developed at the top level – regarding for instance recruitment. In such circumstances, there seems to be only two possible futures. Either the university looses foot in terms of those outcomes valued by performance indicators, its resources regresses and it stabilizes as a possible good teaching college, or the presidential team and top management find resources to behave as enlightened despots and centralize power as to sustain ambitious projects, drawing new faculty members and redistributing resources and structures, with a high risk to lose legitimacy and face major resistance.

The third case deals with professional bureaucracies with strong scientific links and reputation, which professionals are not always strongly integrated internally except for sharing special attention paid to their prestige. They perceive the overall establishment as the sum of self-sufficient parts distinct from the hierarchical line of management. The president and management have too little influence and hierarchical legitimacy to develop or impose an overall strategy, or to impulse debate on strategies among faculty members. The internal governance draws upon the implicit trust in interpersonal peer relations. Administrative services are considered as ­second-class tasks to be staffed by good, loyal servants who are requested not to interfere in academic policies and to remain subordinated to the academic world. The organization is conceived as a receptacle deployed to serve its members’ prestige, rather than as a proactive principle driving a collective dynamic. Debating on the organization of resources or bargaining are all forms of bad manners. There is no strategy except as the culmination of organizational forms accumulated over time that favor a distributive policy tending to preserve vested positions since resources are allocated based on acquired rank, prestige and status. Managing the organization consists primarily of incident management.

The benchmark community is disciplinary and cosmopolitan. It is the scope and quality of the professional networks rather than membership in the local institution that confers visibility and power upon the institution. Thus, the internal strength of a sub-community – and of its members – derives in large part from the degree of exclusivity of the control it exercises over the selection, training, placement and careers of its members throughout their lives, and from its ability to impose distinguishing social and professional criteria in its domain at both national and international level.

In other words, the local institution outsources its human resource management function, its scientific policy and its operating definitions of relevance and excellence to outside professional communities. It serves as a host structure for professionals distinguished by their community. Each profession or discipline is governed by inherently intractable criteria in terms of the type of research or courses provided, or the social regulation of its members. The local institution has to trust the ability of the professionals present in its midst to promote its image and reputation in larger external arenas. This does not mean that the reputation of the institution is indifferent to the prestige of its faculty members. This is why they resist developments that could affect the image of the most prestigious local institutions in which they are established. As a guiding principle for action, collegiality facilitates the alliance between the local and the cosmopolitan, and between the establishment and the profession. It enables both governance of a peer group by importing external standards of legitimate power, such as length of service and grade, and coexistence of different professional communities by not imposing uniform, rigid criteria for arbitrating between them.

Such aristocratic organizations are allergic to the type of reform that is imposed upon them. They may have good scientific assets, their poor internal integration capacity, their weak level of professional management, and their reluctance towards organizational leadership and collective strategy, put them into a difficult position to face the challenges of reforms impacts. The organization as such is unable to back up its members in the competition that rebuilds reputation by formal performance, such as grants and rankings.

Like missionaries, venerables have two ways out.

One is to stiffen their position with the risk to weaken their reputation by progressively downgrading their resources of all sorts. The other one is to enter a revival scenario by building up a strong managerial leadership that reorganizes the whole institution top-down from the inside. In that last case, typical of wannabes they will centralize ­managerial power, dilute internal rules that used to give a strong say to academics, renew their faculty by buying them at their fair price on the labor market, and develop incentives as to have them contribute to the collective formal performance just by summing up individual contributions (based on their gender, nationality, publications), encouraging normal science – more productive in terms of publication – over scientific exploration activity and paying less attention to their education mission than to their ranking. They will find ad hoc solutions to issues raised by this reconstruction of their labor force, such as recruiting high standing professionals as part-time lecturers to face the need of high level ongoing education courses that young intensive article producers ­cannot fill adequately and replace the ranks of permanent staff depleted by publication incentives. In other words, managers will reestablish the organization from the top, based on a shared value of opportunistic utilitarianism, with the premise that an academic institution can be managed ­sustainably just like a kit, by reducing the academic activity to a market commodity that reconciles individual interests with the collective good through the individualistic behavior of staff driven by short-term material success incited by an authoritarian management that can and will tread on the academic ethos.

7 Conclusion

The first part of this paper details why and how European countries, with predominant public higher education based on funding by welfare states, are experiencing the same trend of reforms since the 1980s and more intensively since the turn of the twenty-first century. Ongoing reforms aim at reinforcing the intra-organisational link. Academics fear, with some lapses of memory and for some good reasons, that these reforms might weaken their professional links and convert professional bureaucracies into mechanic bureaucracies by enhancing exogenous governance mechanisms based on new ways of setting research priorities, reinforcement of presidential power and formal accountability of universities, all these orien­tations converging towards tighter coupling of constituents within the university organization.

We have shown that the same reform repertoire gives birth to interpretations that vary from one country and from one university to the other. Countries and universities face these reforms in highly variable manners, with varying impact on the academic professions, depending upon where they come from, how scientific elites relate to society and political power at large, and how much stress is put on their constituents.

Hence, reforms are in the process of differentiating European universities. Whether they will produce wannabes or top of the pile institutions remains to be discovered in the future.