Universities and other institutions of higher learning now encounter far more challenge, and are subjected to an unprecedented level of external scrutiny. All providers of higher education today inhabit a more competitive world where resources are becoming scarcer, but at the same time they have to accommodate increasing demands from the local community as well as changing expectations from parents and employers. In order to be more responsive to all these competing needs an emphasis on "strong management" is introduced in the educational realm, with a fundamental paradigm shift to the notion of "economic rationalism" in running educational services. In such a policy context this paper sets out to examine how higher education in Hong Kong has gone through a similar process of marketisation, with particular reference to the strategies and approaches adopted by the University Grants Committee (UGC), the central funding body of higher educational institutions in Hong Kong, to assure a quality and "value for-money" higher education in the territory. This paper will end with a discussion of the implications of the adoption of a "management-oriented" approach in delivering educational services.