National universities in Japan are now confronted with two problems: progress of international competitiveness in the academic research, and improvement of quality in education. The National School Special Account by which national universities are funded restricts their management and finance. Resource allocation is made by inputs such as the numbers of students and the types of course in operational work, and by assessment of the planning in the competitive research grant. Thus motivation for high performance in resarch and improving the quality in education does little work in the current system. To solve these problems and to encourage flexibility in personnel, changing from input
management to output management and prohibition of internal promotion are proposed.