Performance Agreement Through the Lens of Resource Dependence Theory

Abstract

This study applies resource dependence theory to address the question of how the critical resource dependence relationship emerges in the context of a university’s performance agreement. This study focuses on two Nordic universities that have adopted performance agreements while simultaneously using strong performance-based state funding. Resource dependence involves an asymmetry and power imbalance that leads an organisation to believe that it is dependent on a more powerful organisation that has resources under its control. The theory reveals the central role of performance agreements and their associated instruments in the universities’ relationship with the ministry and within universities. We found minor differences in Nordic university examples indicating the influence of the performance regimes within the management arena and within the material dimensions of university autonomy. Performance agreements and their related instruments are isolated from the other key realities of universities. Understanding the loose coupling between the agreements and the characteristics of universities are needed to enhance universities’ ability to pursue their unique mission in society. Resource dependence theory provides a valuable framework for analysing the dynamics and dependencies that exist between organisations and within loosely coupled organisations, shedding light on the interactions and influences that shape these relationships.