The article focuses on recent shifts in modes of coordination and the emerging drive towards new public management (NPM) in higher education and examines Lithuanian higher education policy as an example. It investigates the dynamics of the shift by exploring how stakeholders define the term and how, in turn, it influences the political agenda. Using secondary literature review, primary document analysis and a range of interviews with stakeholders active in the higher education policy process in Lithuania, the study places Lithuanian developments against the wider European trends in higher education policy. The findings suggest that after 15 years of changing the modes of coordination in Lithuania's public sector, NPM rhetoric has recently begun to penetrate the higher education policy agenda. How far it will influence university management and academic work is still questionable.