Modern universities achieve institutional goals when faculty members are able to fulfil diverse roles. Faculty development must therefore employ pedagogical principles while guided by institutional needs. Systematic evaluation of such programmes has not been done in developing countries. This paper examines faculty development in Iran, where medical universities have a reformed structure that combines educational and extensive health care responsibilities. Managerial and pedagogical aspects of faculty development were evaluated to help administrators understand and meet faculty and programme requirements. This work identifies strategies to improve productivity through faculty development. (Contains 3 tables.)