The production of research output has become a complex and competitive pursuit. Basic, experimental and strategic research compete more for scarce state and donor funding. In South Africa, research output is recognised through government subsidy-earnings guided by the policy for the measurement of research output of public higher education institutions. In this context, the management of research output at higher education institutions has become a highly professional task that requires the ability to understand and translate national policies and directives at the institutional level into opportunities for individual researchers and postgraduate students to pursue their interests and achieve their potential. A study on how a leading university and its faculties respond to the new policy on the measurement of research output in relation to the New Public Management might assist other institutions of higher learning to manage and impr