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Fiddling while Rome burns

I often think to myself, what will university leaders be known for 20 years from now? Will it be maintaining today’s core business, or creating tomorrow’s? Will they be known for leading change?

I also ask them what they think, and I’ll get to some of their views below. I ask them this mindful of three dominant factors at play, which I believe are irrefutable and recognised by us all.

Firstly, demand for fee-paying, on-campus, degree-awarding, undergraduate and postgraduate education by domestic and international students is falling in developed countries. Demand is changing in shape and nature. It is migrating toward online, stackable, credentialed, personalised and globally available learning, and will continue to do so. Ignoring this is futile and dangerous.

Secondly, university public sympathy has reduced. As has employer satisfaction, staff morale, student satisfaction and government support, and the detrimental impact of the way government currently manages provision of learning has got worse. Meanwhile public, government and employer support for competitor innovative learning providers – not just universities – is growing and will continue to. You’re not the favourite child any more.

Thirdly, this is occurring while global demand for skills grows. But it is now less for school leaver graduates and more for lifelong learning, for an ageing population as falling birth rates become widespread, and as the need for skills updating rises exponentially.  Global demand in developing countries for democratised access to lifelong learning is growing fast and will continue as a search for equity in global declining populations, amid geo-political turmoil, makes it inevitable.

So what are the nature of the threats and opportunities that this triple whammy creates and how do global leaders respond? Because not doing so is at best very risky, and maybe fatal.

The conventional current and future market for on-campus degrees for school leavers will continue to decline. It is currently the core of higher education. It faces increasing regulation, central direction and control. This core business also faces increasing student and employer dissatisfaction because of the shorter half lives of skills generated. The market is rejecting the costs incurred in gaining such skills. And the learners are increasingly dissatisfied with the poor learner engagement and unsatisfactory experiences. Actions by government regulators – in the UK with fixed student fees since 2017, Australia with its recent Accord, and the US – are almost entirely applied to the current core business model. Leading by relying on this declining and unattractive market alone is not smart leadership. While all leaders accept that, few are doing something about it.

This core business is the domain of many commentators, most mainstream conferences, and much of the thought leadership in books, podcasts and social media commentary. It is also where consultants of the big 4, and some specialist higher ed advisory service providers, have most expertise and sales activity. I am sure their fiddles make a merry noise and lots of fees. The future lies elsewhere and learning and sharing how to do it is where HEDx, and others, are heading. A recent McKinsey reportrefers to this alternative to the core as the ‘adjacency’.

Managing the core, while growing the adjacency, is the dual challenge for every global university leader at present. Managing the core is increasingly a managerial task. It is bedevilled by increased intervention and falling demand, upon which future success and growth – even long term survival – is uncertain. Mark Corver argues this change will be easier and more lucrative in the short-term for older and more reputable universities, rather than younger and lower ranked ones. It is relatively non-lucrative for everyone in the long term. Delay moving to a non-reliant engagement with the core at your peril, Vice Chancellor or President.

Moving from the current and future learning economy into adjacencies is exciting. It is opportunity rich, and is where legacies will be created. This is the greatest challenge and opportunity that has ever faced higher education leaders. I have spoken to two global leaders over the last two weeks about this distinction and the place it has in current leadership priorities, and how they see their legacy.

At a dinner after our HEDx conference in Melbourne, Australia, I asked Andrew Parfitt, the Vice Chancellor of UTS in Sydney, a pertinent question. With his  second term underway, I asked what he hoped he would be famous for in where UTS had got to in 20 years time. He said it would not be how well he had managed the core of current UTS activities in declining markets. It would be how he led new adjacencies where his flair as a leader, creator and innovator would be at the fore. I have known Andrew for 20 years and know him to be a great and creative innovator. Andrew pointed me to these terms, and clarified my determination of HEDx heading there, working out how to do it and sharing it.

I then replayed that discussion with Sir Ian Greer, who has just commenced his second and last term as Vice Chancellor at Queen’s University Belfast in Northern Ireland. Sir Ian is doing innovative things at Queen’s, in partnership with leading global innovators like Aleks Subic at Aston. They are each working with similar global tech companies and partners, in leading local community, place-based innovations in particular contexts. They share their innovation ‘adjacency’ experiences on a world stage through groups such as the Global Forum of Competitiveness Council (GFCC). The GFCC sees a need for universities to drive productivity and competitiveness in world economies to remain relevant. Sir Ian has no doubt history will judge his legacy, not by how he survives fee-capped and places-capped core activities in the unique Northern Ireland context. It will judge how he develops new business models and products for the skills and knowledge economy, with local partners, in doing something boldly relevant on a global scale.

Sir Ian Greer, Vice Chancellor of Queen’s University Belfast.

Such examples of global best practice, by pioneers and innovators, will be an increasing focus for HEDx in the months ahead. There will continue to be much interest in the core activities of current global higher education. It will feature in much of the debate within congressional hearings in the US, in forthcoming election lobbying and survival planning in the UK, and will be the primary focus in Accord implementation in Australia. I’m not much interested in it, or the regulators.

Given the slow pace at which the Australian Universities Accord was developed and released, and the bureaucratic barriers to its implementation through budgets, elections, implementation planning agencies, and commissions, it is clear its implementation will take a long time.Time to work through 47 recommendations of how to manage the core, before it impacts on the leadership challenges of adjacencies. Meanwhile Rome burns.

Work in innovation, and exploration of adjacencies, is the purview of creatives, start-ups, youthful leaders, and the private sector – not policy makers and regulators. Exposure to this innovation is what I am heading to engage with at the ASU+GSV summit in San Diego. Best practice in exploring adjacencies in Australia has been under way at Melbourne Business School, under the leadership of its Former Chief Learning Innovation Officer Dr Nora Koslowski. I have been delighted to work closely with Nora as she pioneered reinventing the MBS core and developing really innovative new adjacencies. Nora gets it.

Dr Nora Koslowski, former Chief Learning Innovation Officer, Melbourne Business School.

Sharing the spotlight

Pioneering creatively, innovative adjacencies will increasingly be at the forefront for leaders like Nora, Andrew, Aleks and Sir Ian, at some universities of various tiers. It will have to be for all of them eventually or they will fail. It was the common denominator among the 200+ people who came together at our HEDx Melbourne event two weeks ago. Anyone can listen to what innovators took part in below.

You can hear a podcast episode that includes Michael Crow of ASU, and an equity panel of Paul Harpur of UQ, Marcia Devlin of VATL, Joel di Trappani of Vygo, Cate Gilpin of Welcoming Universities and UMelb student Mohamed Omer here.

And in a session that starts from our current leaders looking to span from the core to each of their adjacencies, you can hear from David Lloyd of UA and UniSA, Andrew Parfitt of UTS, Helen Bartlett of UniSC, Kent Anderson of Newcastle, Jessica Vanderlelie of La Trobe, and Ant Bagshaw of L.E.K. Consulting here.

To understand how technology is used to support the core, but also as a strategic driver of new business models in adjacencies, you can listen to Josh Nester of SEEK Investments, Sue Kokonis of OES, David Linke of EduGrowth, Eric Knight of Macquarie, Manuela Franceschini of Adobe and Sherman Young of RMIT here.

As I said last time, we are bringing the world to HEDx and taking HEDx to the world. It is an approach that John Dewar, who led core activities and adjacencies at La Trobe, commented on at Melbourne. He applauded our private sector engagement, technology focus and international and out-of-sector perspective.

Thanks to all for joining our movement of Changing Higher Education for Good. I believe we will all do so by focussing increasingly on adjacencies of change, alongside others managing the core. Please share this newsletter. I hope it becomes a must-read for all your networks, helping shift their focus in this way.

What we are reading

Britain’s universities are in freefall – and saving them will take more than funding

There are particular issues facing UK universities with the ramifications of Brexit and a particular aggressive stance towards universities by government in the current electoral cycle. But the underpinning issues being faced are just more acute forms of those that all global universities must reconcile.

Higher Education on the Edge in the US

The US has been facing a downturn in student numbers, and failure of public universities and colleges for a longer period for its own version of global phenomena. It has a demographic cliff looming more profoundly with its population profiles. A shrinking pool of potential students and a sceptical public, spell even greater trouble for many colleges and universities in the years ahead – and solutions aren’t easy.

Which types of universities are demand declines impacting most?

Mark Corver is a former analyst and advisor within HEFCE and UCAS in the UK as a funding agency and admissions service for the public university system. With his extensive experience and data analysis know-how, he is independently analysing data on UK enrolment and application trends. In this piece, he identifies how higher tier universities are faring much better than lower tier universities with policy and market trends in the UK. They are similar to those to be found in other national higher ed systems.

Advanced-industries companies that enter adjacent markets with the right approach can outgrow and outperform their peers.

It would be easy to take those global trends which are playing out in similar ways in all developed countries as a sign of nothing but gloom and doom for global universities. The reality is different and one of a shifting shape and nature for global lifelong learning demand.

Unmet demand for global democratised education in world markets calls for responses fit for purpose. And a shift to skills-based needs of lifelong learners everywhere simply means that the form of lifelong learning we need has shifted. It has moved on from being exclusively the current core of a time-based, campus-based model for school leavers, all provided by research-teaching universities. Its time for everyone to wake up to reality.