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Management Control Systems, Strategy Implementation and Capabilities Development in University Academic Units: Impacts on Performance

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Management Control Systems, Strategy Implementation and Capabilities Development in University Academic Units: Impacts on Performance MANAGEMENT CONTROL SYSTEMS, STRATEGY IMPLEMENTATION AND CAPABILITIES DEVELOPMENT IN UNIVERSITY ACADEMIC UNITS: IMPACTS ON PERFORMANCE A thesis submitted in fulfilment of the requirements for the degree of Doctor of Philosophy BELETE JEMBER BOBE MBA, Grad Dip (Management), BA (Accounting), FCCA, CPA School of Accounting College of Business RMIT University August 2012 i DECLARATION I, Belete Jember Bobe, certify that the work completed is mine alone, that this work has not been submitted previously to qualify for an academic award, that the content of this thesis is the result of work which has been carried out since the official commencement date of the approved research program, that any editorial work undertaken by a third party is acknowledged, and relevant ethics procedures and guidelines have been followed. Belete Bobe August 2012 ii ACKNOWLEDGEMENTS Several people have helped and supported me in different ways in writing this thesis. First, I would like to express my gratitude to my supervisor, Professor Dennis Taylor, for his guidance and supervision in the last three years of my study. I thank him for listening patiently and questioning and challenging my ideas which have helped me stay focused and clarify my thoughts. I would also like to thank Professor Beverley Jackling who was my principal supervisor for the first one-and-a-half years of my study until she moved to another university. I am indebted to her for the many hours she spent in helping me develop the PhD proposal and prepare for confirmation of my candidature. A special word of gratitude goes to my friend, Associate Professor Alemayehu Molla, for being there for me whenever I needed him, sometimes at late hours, from day one of this research project. He has been so generous in his time in reading and commenting on various draft documents and chapters and sharing his research experience with me unreservedly. I also thank my longtime friend Asmare Emire for sharing the educational journey from bachelor to PhD degrees. He is one of the trustworthy friends I have made in my life. I would also like to extend my gratitude to the School of Accounting, Economics and Finance, Deakin University colleagues, in particular, Professors Barry Cooper, Nava Subramaniam, Graeme Wines and Mr Bruce Hoyle for their mentoring, encouragement and institutional support. I thank Dr Judy Maxwell, Study and Learning Centre, RMIT University, for reading some of the draft chapters. I would also like to thank and express my appreciation of Ms Lynn Spray for her prompt, thorough and professional proof-reading services. A number of progress presentations were made at different stages of this PhD project at School of Accounting, Economics and Finance, Deakin University, research seminars. I thank all my colleagues for their valuable comments. I would also like to acknowledge that this thesis has benefited from the constructive feedback received at the following conferences, and I extend my sincere gratitude to the participants at: Global Management Accounting Research Symposium (GMARS) 2008, University of New South Wales, Sydney, June 2008; Monash University Forum for Management Accounting (MONFORMA) 2009, Doctoral Colloquium, Melbourne, June 2009; AFAANZ 2009, Adelaide, July 2009; 6th Asia Pacific Interdisciplinary Research in Accounting (APIRA) 2010, The University of Sydney, iii July 2010; 8th International Management Control Research Conference, University of Greenwich, London, September 2010; and MONFORMA 2010, Melbourne, November 2010. I am grateful to the Pro Vice-Chancellors and Heads of Schools/Departments in the two universities in Victoria, Australia, who participated in the pilot study, and to the Heads of Schools/Departments in all thirty-nine Australian universities who completed the survey questionnaire. Several other people whose names I have not listed above due to limitations of space have supported and encouraged me. I thank each and every one of them from the bottom of my heart. Words cannot convey the appreciation and love I have for the most important people in my life - my family. Without the understanding, encouragement and above all love of my wife Emebet, and my sons, Kale-Ab (10) and Daniel (1), I could not have completed this thesis. I hope this work will inspire my boys in their life journey. Belete Jember Bobe August 2012 iv Table of Contents DECLARATION ....................................................................................................................... ii ACKNOWLEDGEMENTS ..................................................................................................... iii Table of Contents ....................................................................................................................... v List of Figures ........................................................................................................................... xi List of Tables ............................................................................................................................ xi List of Appendices .................................................................................................................. xiv List of Acronyms and Abbreviations ....................................................................................... xv SUMMARY ............................................................................................................................... 1 CHAPTER ONE: ..................................................................................................................... 5 INTRODUCTION.................................................................................................................... 5 1.1. INTRODUCTION ........................................................................................................... 5 1.2. BACKGROUND AND MOTIVATION TO THE STUDY ............................................ 6 1.2.1. Introduction to the Australian higher education sector ............................................. 6 1.2.2. Motivations for the study .......................................................................................... 9 1.3. RESEARCH AIMS AND OBJECTIVES ..................................................................... 14 1.4. RESEARCH QUESTIONS ........................................................................................... 15 1.5. SIGNIFICANCE OF THE STUDY............................................................................... 17 1.6. THE STRUCTURE OF THE THESIS .......................................................................... 18 1.7. CHAPTER SUMMARY ................................................................................................ 21 CHAPTER TWO: .................................................................................................................. 22 THE AUSTRALIAN HIGHER EDUCATION CONTEXT .............................................. 22 2.1. INTRODUCTION ......................................................................................................... 22 2.2. NEW PUBLIC MANAGEMENT (NPM) ..................................................................... 23 2.2.1. The origin of New Public Management .................................................................. 23 2.2.2. Doctrines of New Public Management ................................................................... 25 2.3. AUSTRALIAN HIGHER EDUCATION SECTOR REFORMS ................................. 28 2.4. OVERVIEW OF THE AUSTRALIAN HIGHER EDUCATION SECTOR ................ 33 2.4.1. Structure of the Australian higher education sector ................................................ 33 2.4.2. Student and staff statistics ....................................................................................... 37 2.5. DIRECTIONS OF AUSTRALIAN HIGHER EDUCATION SECTOR ...................... 39 2.6. THE UNIQUE NATURE OF UNIVERSITIES ............................................................ 41 v 2.7. IMPLICATIONS OF THE UNIQUE NATURE OF UNIVERSITIES ON STRATEGY AND MANAGEMENT CONTROLS ..................................................................................... 44 2.8. CHAPTER SUMMARY ................................................................................................ 46 CHAPTER THREE: .............................................................................................................. 48 LITERATURE REVIEW ..................................................................................................... 48 3.1. INTRODUCTION ......................................................................................................... 48 3.2. REVIEW OF THE LITERATURE ON ORGANISATIONAL CAPABILITIES ........ 50 3.2.1. Introduction ............................................................................................................. 50 3.2.2. Sources of sustainable competitive advantages: internal strengths versus external forces 53 3.2.2.1. The environmental determinist view of competitive advantage ............................... 53 3.2.2.2. The resource-based view of competitive advantage ................................................. 54 3.2.2.3. Organisational capabilities and performance ............................................................ 64 3.2.2.4. Application of RBV in universities .......................................................................... 69 3.2.2.5. Review of the empirical RBV studies on higher education institutes ...................... 74 3.2.2.6. Conclusion on the review
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