The Positive and Negative Consequences of “Managerialization”: Evidence From Japanese Nonprofit Elderly Care Service Providers

In recent decades, many researchers have pointed out that nonprofit organizations are becoming “managerialized.” Although the “managerialization” may enable these organizations to improve their financial performance, it may also reduce their unprofitable mission-related services. However, there are few studies examining both aspects simultaneously. This study focuses on the managerialization of nonprofit organizations, especially the tightness of budgetary control systems and characteristics of top managers, as well as the negative and positive consequences of becoming managerialized. To test our hypotheses, we collected information about Japanese nonprofit elderly care service providers using a survey. Research results revealed top managers with more experience tend to improve the financial performance of nonprofit elderly care service providers using tight budgetary control. However, the results show no relationship between tight budgetary control and the provision of unprofitable mission-related services. Thus, in our setting, managerialization has a positive effect; there is no negative effect