Monitoring and Assessing Institutional Performance in Higher Education
During the last decade dramatic changes have emerged in the way governments interact with colleges and universities. Governmental authorities are no longer as receptive to the traditional self-regulatory processes that have dominated university development for centuries. A new economic motivation is driving states to redefine relationships by pressuring institutions to become more accountable, more efficient, and more productive in the use of publicly generated resources. Earlier attempts by states to measure institutional efficiency and performance have generally been met with passive resistance or benign neglect in academic circles. Although this trend still prevails, an increasing number of educational leaders are now exhibiting an awareness that the status quo is no longer a viable option for higher education. Barnett (1992) points out that our higher education systems have entered "the age of disenchantment" and "society is not prepared to accept that higher education is self-justifying and wishes to ex pose the activities of the secret garden. With greater expectations being placed on it, higher education is being obliged to examine itself or be examined by others" (p. 16). This observation reflects the increasing societal requirement that colleges and universities must become more responsive to national economic needs and new governmental demands for increased performance.
As part of the changing relationship between government and higher education, state governments are placing an increasing burden on higher education to play a pivotal role in transforming the existing low-wage economic structures into high-performance, technology-based economies. Governments are increasingly looking to the different sectors of higher education to augment learning skills and improve workers' ability to develop and use technology, thus enhancing productivity and strengthening the state's economic position. According to Marshall (1995), former U.S. Secretary of Labor, "Education is the crucial element in this transformation process. It can no longer be considered apart from the state's overall economic strategies" (p. 62). Marshall is inferring that education, and increasingly higher education, has become an essential component of national economic investment strategy. In a competitive and global environment, increasing educational investment to produce a highly educated and skilled workforce i s a vital element for future economic growth. Without this investment and reliance on education, and especially tertiary education in industrialized societies, the competitive status of a nation will substantially deteriorate in the coming years.
This reliance on higher education as a principal economic engine is accented by today's world economy, which is changing national economic and educational needs more rapidly than ever before. Higher education increasingly determines a society's evolutionary potential and, in economic terms, affects international competitiveness and choice of industrial location. In nations with comparatively sophisticated higher education systems, governments are adopting new economic and managerial strategies to assess and compare college and university performance. Government reporting and funding mechanisms for higher education are in the midst of a major transformation from complete input-based systems to the adaptation of more competitive outcomes-based approaches (Barnett & Bjarnason, 1999; Brennan, 1999; Ewell & Jones, 1994; Gilbert, 1999; Layzell, 1998; Schmidtlein, 1999).
Since the early 1990s, government interest in performance funding and budgeting for higher education has substantially increased in OECD nations (Burke & Serban, 1997; El-Khawas & Massey, 1996; Jongbloed & Koelman, 1996; Layzell, 1998; Peters, 1992; Piper & Issacs, 1992). This transformation has resulted from the realization that to strengthen their competitive positioning, states and nations must increase their involvement in the development of human capital and research through higher education. As Marshall (1995) observes, "In this more competitive world, dominated by knowledge-intensive technology, the keys to economic success have become human resources and more effective population systems, not possible new organizations of production, not natural resources and domestic economies of scale" (p. 53). For most Western democracies, higher education has become the critical link to future economic success. As The Economist (1997) stated, "In such an economy--one in which ideas, and the ability to manipulate them, count for far more than the traditional factors of production--the university has come to look like an increasingly useful asset" (p. 4).
To achieve the ends of economic growth, governments resort to many devices that are presumed to create greater efficiencies in the use of public dollars while expanding the reach of higher education. Budget reductions and general resource constraints have become commonplace, while institutions are being asked to serve increasing numbers of students and constituencies (Dill & Sporn, 1995; Eicher, 1998). Methods for administering higher education are being transformed, while colleges and universities are being urged to engage in new tasks and assume new responsibilities (Marcus, 1997). The entire nature of the traditional relationship between government and higher education is in the process of significant change in stretching the public dollar to serve more students in attempting to maximize economic returns.
In this new era, governments have adopted public policies advancing the democratic concepts of massification and universality of higher education and have generally rejected the more traditionally restrictive practices grounded in meritocracy and exclusion (Gumport, Iannozzi, Shaman, & Zemsky, 1997; Trow, 1974). The rapid expansion of postsecondary education, in most cases, has proven to be a formidable task for institutional leaders who have not been afforded corresponding levels of public financial resources. Coinciding with national pressure to expand higher education services has been the creation and refinement of state evaluation systems devised to monitor and assess institutional effectiveness and productivity (Cowen, 1996). Such government initiatives devised to seek greater efficiencies by employment of evaluative techniques to assess and compare the performance of colleges and universities constitutes the current thrust of the "accountability movement" in higher education. These challenges have res ulted in systemic modifications in the management and financing of higher education institutions. It is the nature of these developments that provides the impetus for this article.
Accountability Versus Autonomy
As history reminds us, universities have generally experienced difficulty in living up to the expectations of societies at large. Controversies over institutional autonomy and government control are as ancient as universities themselves (Ashby, 1966). As Berdahl (1990) observes, universities are inherently in a state of ambivalence with society because they are "both involved and withdrawn; both serving and criticizing; both needing and being needed" (p. 170).
So what makes the recent performance-based accountability movement distinct? The accountability movement currently inundating many OECD nations is premised on the perception that traditional measures of institutional performance and effectiveness such as peer review and market choice are not sufficient indicators of institutional value. The conflict encompassing this issue was best defined by the British Committee of Public Accounts (1990), which after an internal review of English public universities expressed concern about the nature of autonomous governance, stating, "We do not accept that their [the universities'] independence and autonomy, although undoubtedly valuable in many respects, is a valid argument against the attempts to defend against the shortcomings in realistic and effective management and control of the public funds on which universities are dependent" (p. ix).
Thus, despite unparalleled economic and scientific achievements attributable to higher education during the last three decades, public dissatisfaction with colleges and universities continues to permeate legislative halls. The torrent of popular criticism has forced many institutions to reexamine their educational missions and to seek new funding alternatives (Mora & Nugent, 1998; Williams, 1998). These developments place arduous burdens on higher education systems as policymakers attempt to monitor educational quality and performance …