Management by interpretation, management by adjancencies: A case study of the Business Services Division at the University of Pennsylvania
Do the institutional priorities and underlying systems of nonprofit universities, manifested in a culture of participatory decision making and educational, research, and service missions, present managers with a different set of challenges than those found in for-profit organizations, where financial performance and expectations, by definition, are more clearly articulated? Perhaps the area of university services that most faces this question is auxiliary services, where practices common to for-profit business enterprise conspicuously intersect with the priorities of a nonprofit institution of higher education. This dissertation is a qualitative case study of an auxiliary enterprise, the Business Services Division at the University of Pennsylvania. Its goal is to dissect and understand the layers of knotty challenges that confront this area at Penn, and by extension, provide a useful frame of reference for institutional leaders to define and assess administrative services. An essential element in understanding these issues is the perspective of the managers themselves. This perspective is obtained through data collected in interviews with a purposeful sample of approximately 20 managers who have financial responsibility associated with the Business Services Division. The data obtained through interviews is analyzed and meshed with theoretical and descriptive information. The contextual framework includes reviews of appropriate management, behavioral and organizational theories and practices. Additionally, physical descriptors of the hierarchy and structure of the Business Services Division, and characterizations of the respondents illustrates the contributing factors and environment. I have identified two overarching dynamics which exist simultaneously, influencing and describing the financial decision-making process. First, Management by Interpretation is a management model whereby managers rely on multiple criteria, oftentimes indicators other than absolute quantitative measures, to evaluate financial performance. Second, Management by Adjacencies is a management model describing how financial decisions are driven and tempered by the input of the broader University community. Often these stakeholders are not direct customers or end-users of the product or service provided by the Division, but they exert substantial influence into decision-making processes.
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