This blog was contributed by Paul Woodgates who until recently was Head of Services to the higher education sector at PA Consulting and is now an independent commentator and adviser. Paul has written for HEPI before on the resilience of universities.
As leadership guru Stephen Covey put it, ‘If there’s one thing that’s certain in business, it’s uncertainty.’ While that has always been true in universities too, it does seem that the scale of uncertainty facing our higher education sector has ratcheted up to a whole new level as we emerge from the pandemic.
Making big strategic decisions in this context is hugely problematic for universities. The daunting scale of uncertainty suggests that rather than basing strategic judgements on a single prediction of the future, university leaders need to build the flexibility to permit adjustments to be made in response to real world events.
Living with uncertainty
Consider two possible scenarios for universities over the next few years.
Scenario 1: The future is bleak.
When the response to the Augar Review is finally clear, reductions in the fee cap and variable subject-based top-ups will mean substantially less money for universities and the return of number controls too. International student mobility will decline as a lasting consequence of the pandemic. The Government’s ambitions on levelling up will focus on further education not higher education and the commitments to increase research spending will not be targeted at universities. The Government thinks universities are bloated, out of touch with the needs of the electorate and awash with money; ministers want to target them and watch them squirm.
Scenario 2: The future is bright.
The demographic upturn means there will be substantially more school leavers in forthcoming cohorts than in the recent past. The growth in alternatives to traditional undergraduate education will provide opportunities for those who in the past would not typically have applied to university rather than targeting those who would. The UK’s vaccination programme means international student numbers will grow quickly. Ministers realise that universities are the only organisations with the capability, scale and reach to deliver their electorally critical ambitions on skills and becoming a research superpower.
Both those scenarios are plausible, as are any of the variants in between those extremes (or indeed, something as previously unpredicted as a global pandemic). I have no crystal ball and while, like many of us, I may wile away happy hours attempting to predict the future, neither I nor anyone else can claim any great probability of being accurate.
But in the midst of this huge spectrum of possible futures, universities must make some bold choices as they face the post-lockdown world: big decisions about size, academic focus, teaching and research offerings, organisational structure, technology and estate. Betting on any single prediction of the future policy and operating environment would be fraught with risk, but decision-making paralysis in the face of uncertainty would be no less likely to result in disaster.
To meet this challenge, universities must design flexibility and agility into their futures. When making strategic decisions, university leaders must ask themselves what would happen if their assumptions about, for example, government policy on fees, or demand for new programmes, turn out to be wildly wrong. That must not mean ducking the decision but rather creating ways that allow adjustments to be made later if the future is different to what was predicted.
First, leaders should seek to avoid decisions that hard-wire the link between assumptions about the future and their courses of action. The best example here is in relation to investment in new estate. While a university might see the need for increased teaching accommodation, flexible modular space that is designed to be reconfigured as necessary between lecture rooms and small break-out spaces is likely to be much more useful than fixed designs. Such space may well cost more than traditional facilities – but the value of flexibility should be explicitly considered as part of the investment appraisal.
Similarly, cloud-based and software-as-a-service technology solutions are likely to offer much more flexibility than investment in data centres and on-premise software implementations.
Flexibility in staffing is also possible. Multi-skilled professional staff provide the ability to adapt how resources are deployed as needs change. The trend towards cross-functional service centres employing staff based around a small number of multi-purpose administrative roles is one example.
Flexing for the future
Of course, building in the ability to flex over time will only be valuable if universities do in fact make the necessary adjustments when the time comes. That implies the need for governance in which initial assumptions are revisited to check whether changes in direction are needed – testing for example, whether the initial projections of demand for a new academic programme remain credible.
That approach contrasts with much current governance which tests (often to destruction!) assumptions made before committing to action, but thereafter focuses only on assuring whether the initial plan and budget is being adhered to, rather than on whether the environment has now changed to a degree which should trigger an adjustment to the direction of travel.
Changing tack when the need arises will also require a different approach to risk. Currently any change of direction is generally considered a failure – and very possibly the basis for launching an enquiry to apportion the blame for ‘what went wrong’. Instead, universities will need a portfolio approach to managing risk – with the expectation that making agile adjustments to strategic initiatives is a sign of strength not weakness and is seen as such by all concerned.
Agility has its limits
So, agility and flexibility should be principles for leading a university – but only within limits. The ability to change direction in response to a new understanding of what government is prepared to fund, or what students want to study, or what lockdown rules allow to happen, should be an asset but not if it permits changes of direction so great that the university departs from its fundamental reason for existence.