7 November · Episode 180
A Global Shift in Higher Education Requires a New Business Model
36 Min · By Dr. Drumm McNaughton
This conversation–rooted in the findings of E&Y white paper: How are you balancing the books for a digital future? covers the global shift in Higher Education.
Navigating a Global Shift in Higher Education
The traditional business model of higher education is facing an unprecedented challenge on a global scale. For universities that don’t have the cushion of the Ivy League list, the stark reality of declining enrollment and soaring costs looms large. Today’s educational leaders are grappling with a landscape where class sizes have shrunk to nearly 70-80% of what they were just half a decade ago. This contraction is not a mere ebb and flow but a clarion call for a fundamental change in how these institutions operate.
Cutting costs, a go-to strategy in lean times, has reached its limits. Universities are discovering that austerity measures alone can’t bridge the gap between dwindling revenues and rising expenses. There’s a pressing need to reassess underutilized assets and repurpose them in innovative ways that add value to the student experience and open up new revenue streams.
The market for higher education has also become increasingly competitive, with alternative learning platforms offering specialized skills training that directly caters to industry needs. In this high-stakes environment, universities must pivot from being mere dispensers of knowledge to creators of a unique educational journey that aligns with the aspirations and demands of a new generation of learners.
Crafting a New Business Model for Financial Stability
Understanding and serving the needs of students is paramount in redefining the value proposition of a university. This begins with an authentic dialogue with the very individuals who seek higher education. By engaging in conversations with potential students — understanding their hopes, needs, and expectations — universities can craft an educational experience that resonates with their audience.
In this podcast, Catherine Friday of Ernst & Young, in a discussion with Dr. Drumm McNaughton of The Change Leader, emphasizes the importance of personalization and quality in crafting this new educational paradigm. The learning experience must be tailored, not just in content but in delivery, leveraging the latest digital tools to enhance accessibility and engagement. This approach calls for a shift from a one-size-fits-all model to a dynamic, student-centered framework that prioritizes individual learning paths and outcomes.
Innovative educational models take cues from high-end experiences in other industries, where customer feedback directly shapes the product or service offered. Universities can adopt similar strategies, using advanced analytics and artificial intelligence to understand and predict student needs, thus creating a more responsive and adaptive learning environment.
Evidence of Emerging Success in New Models
The conversation between McNaughton and Friday isn’t just theoretical; it’s grounded in real-world examples of educational innovation, such as Philly Mantella of Grand Valley State University and The Rapid Education Prototyping for Change (REP4) initiative and strategies implemented by David Decker of Franklin University. By directly involving high school students in the design of their future educational experiences, REP4 demonstrates a proactive approach to student engagement.
Moreover, advancements in digital learning technologies are not just buzzwords but tangible tools reshaping the educational landscape. Examples like AI tutors in Korea show the potential for technology to personalize learning at scale. These tools not only enhance the classroom experience but also streamline administrative tasks, freeing up valuable resources to focus on the core educational mission.
Data-driven decision-making and operational efficiencies gleaned from advanced analytics offer a glimpse into a future where universities are not only centers of learning but also hubs of innovation, efficiency, and inclusivity.
Three Key Takeaways For Higher Education Leaders and Boards
- Student-Centric Change: At the heart of lasting institutional transformation must be the people it serves. Understanding their specific needs and expectations and learning how to cater to those needs is crucial for sustainable change and financial stability.
- Embracing Digital Innovation: Digital tools and platforms are instrumental in creating personalized, accessible, and engaging educational experiences. The integration of technology in teaching, learning, and administration is a cornerstone of a future-ready university.
- Strategic Partnerships and Openness to Change: Developing new partnerships and being open to previously unexplored avenues of operation can lead to sustainable models of success. This might include new revenue streams, commercial ventures, or strategic mergers.
It is recommended that you listen to the full conversation, rooted in the findings of the Ernst & Young white paper: How are you balancing the books for a digital future? in connection with Times Higher Ed, as it underscores the urgency for change in higher education and what you can do to craft a sustainable higher education business model.
Institutions must navigate a path that honors their academic traditions while boldly embracing the possibilities of the digital age. As the world evolves, so too must the bastions of learning, not just to survive but to thrive as beacons of knowledge, innovation, and societal progress.
In this endeavor, leaders should not shy away from discomfort. It is often in the unease of change that the seeds of progress are sown. Universities that heed this call will not only secure their own future but will also shape the future of education, society, and the world at large.
About Our Podcast Guest
EY Oceania Managing Partner, Government and Health Sciences; EY Global Education Leader
Catherine has spent much of her career providing services to state and federal departments and regulators, ministerial councils, not-for-profits, and NGOs in every state and territory in Australia and in New Zealand. The implications of the work she does are far-reaching, delivering the best outcomes for citizens across education, health, human services, defense, transport and infrastructure, and central agencies.
About the Host
Transcript: Changing Higher Ed Podcast 180 with Host Dr. Drumm McNaughton and Guest Catherine Friday
Drumm: Catherine, welcome to the show.
[00:00:13] Catherine: Drumm, thank you so much for having me. It’s lovely to be here.
[00:00:17] Drumm: It’s great to have you on the show. Now you’re calling in from Melbourne,
[00:00:23] Catherine: I am indeed, I am a proud Aussie, and I am absolutely calling you from Melbourne, Australia, which is my long-time home.
[00:00:32] Drumm: Aussie, Aussie. Oi, oi, oi.
[00:00:35] Catherine: that’s how we roll.
[00:00:39] Drumm: So. I know very little about Australia other than it’s really big and really beautiful, very diverse. What’s it like living down there as an academic and a consultant?
[00:00:51] Catherine: Look, it’s a really interesting place to live. You make an excellent point. We are a long, long way away from everything, which I think means that we have a particular mentality around being independent, around being innovative. You know, when we want answers to big questions, chances are the rest of the world is asleep. So we’ve just got to get on and figure it out. It’s a really close, both consulting and academic community. So very collaborative, very collegiate. But competitive as well. And I guess that shows up in the rankings of some of our, some of our big research elite universities amongst some of the very best in the world.
[00:01:30] Drumm: Well, and just a clarification, when you say the rest of the world is asleep, you mean literally asleep.
[00:01:35] Catherine: I do. That, is exactly right. Just because of the function of time zones, we’re literally when we are up. Everyone else is sleeping, pretty much everywhere else on the planet. And of course the reverse is also true. So I guess that just means, we’ve had a history of,when we have problems, we just need to crack on and solve them because if we wait for other people to help the problem will have overtaken us. So we just get on and do what we need to do.
[00:02:03] Drumm: Very good. So, with that as an introduction, tell us a little bit about yourself. I mean, you’re… With E& Y, the global education leader, and E& Y has a very good practice in education. Tell us a little bit about yourself.
[00:02:18] Catherine: Drumm, thank you so much. So I have been with EY for gosh, most of this century. So I was an Arthur Anderson girl back in the day when there was an Arthur Anderson and then came over to EY in 2002 as either an asset or a liability depending on your point of view. and I’ve had the opportunity to have a very rich and rewarding career in EY since that time. and I have been the, very proud leader of our global education practice since about 2018. and we have education practitioners in around 85 countries, in the world. So everything that the firm does from strategy or transactions or audit or whatever it is we do, we will be doing for an education client somewhere in the world now.
[00:03:05] Drumm: Of course, and that has to do a lot with time zones.
it sure does. That’s exactly right.
Now, you guys just brought out this new white paper. Entitled how are you balancing the books for a digital future, you know you’ve done that in conjunction and partnership with Times Higher Ed which you know it’s not an unknown publication by any means, actually it’s probably one of the biggest in the world when it comes to higher ed. Tell us a little bit about that because that’s really the basis for our conversation today.
[00:03:39] Catherine: Drumm, so, look, the genesis of that work that we did with Times Higher Ed was a couple of discussions that we were having amongst our education leadership group globally. And just, you know, sharing observations around the… sorts of challenges that particularly our sort of our mid tier higher education clients were facing into.
And we were wondering if what we were observing, say in Canada or the UK or the US or even my own home here in Australia, were there common root causes to those things that they were facing into? And if so, could we get our heads around them? Could we better understand what was going on?
And so we decided, it was worth floating the hypothesis that there were some common challenges that the universities that were facing into, and therefore possibly some merit in thinking about what some common solutions to those problems might be. So we undertook that research in conjunction with Times Higher Ed, and they were a great partner to work with, and so we engaged with university leaders across, those key sort of countries that I’ve named and New Zealand as well, just to say, you know, what is going on in the higher education sector? And are there common causes here to what we’re observing around some financial sustainability challenges? And we agreed that there definitely were. So there were, common issues around, rising. costs, so rising, energy costs, obviously, inflation is a big thing. interest rates are going up. wages are going up every pricing point that you look at there are challenges there. There are declining domestic enrollments in most of the countries that we looked at. government funding is fixed or falling in real terms in most of the countries that we looked at. and of course, also in most of our countries, employment is at record highs when I think it’s the flip of that is unemployment is at record lows.
So correspondingly for a lot of potential students, the value proposition of higher education is a little bit challenged. You don’t have to have a degree in order to get a job right now. and when you overlay that with things like housing being increasingly unaffordable in a bunch of these countries as well, it just makes the whole value proposition of higher education a little more contested than it’s been in recent decades, and that is producing the inevitable consequences of much softer financial outcomes than universities, and in many cases planned for.
[00:06:00] Drumm: well. We’re seeing it all over the globe, and you mentioned, the four or five countries, Australia, Canada, the UK, and the U. S. Here in the U. S., we’re getting hit very hard with many of those things, but it, you know, kind of reminds me as well, Einstein’s definition of insanity, doing the same thing over and over and expecting different results. Is that what you’re seeing as well?
[00:06:25] Catherine: Yeah, look, it’s interesting, Drumm, it really is, and obviously when we’re talking about university leaders, we are talking about some of the best and brightest brains on the planet. but they are needing to think about, the current, changes to the sector and overlaid with things like AI and digital and all of those things, which of course a challenge is that no university leader in the history of universities has ever had to contemplate before.
And so some of the perhaps more traditional responses to financial pressures, cost. cutting, trimming around the margins, reducing travel, reducing payroll, even perhaps selling off things like real estate assets. That’s simply not going to cut it for the longterm here. That might buy you a little bit of time, but it’s not going to fundamentally solve for the problems, and that requires a whole different way of thinking.
[00:07:14] Drumm: It really does. I just got an article from a good friend of mine today talking about the whole situation at West Virginia University. And of course, I know Gordon Gee, I have a tremendous respect for him, he’s been in higher ed as a president for as long as anybody that I’ve known, they’re having to cut back significant programs, faculty, they’re essentially cutting out all language studies, a lot of liberal arts, because the enrollment just hasn’t been what they had expected it to be.
[00:07:45] Catherine: Yeah. and Drumm, I think that’s true. And certainly like when we look across the U S a number of, really big, institutions in the U S, the assets are really underutilized. So class sizes are sort of 70 to 80%. of what they were even five years ago, and obviously that makes it increasingly expensive to teach each student because there’s, such a lot of cost now overlaid on a smaller student population.
So, exactly what you’re describing, I think, is really common across the US, but as you say, also Canada, Australia, New Zealand, the UK and Ireland as well. So, certainly in big English speaking countries and everything that you’ve described is, is really true.
[00:08:27] Drumm: Well it, it’s also interesting to me, I just had a conversation with David Decker, who’s the president of Franklin University, and they’re approaching things very differently than most other institutions. They actually grew during the pandemic. They’re primarily online. They’ve gone back after the pandemic, they’ve gone back to their double digit growth.
Now, we’re not talking SNHU, Southern New Hampshire University, they’re doing very well, but the way they go about designing their courses is very different. They know students don’t want to pay anything for their education. They mostly cater to first gen. They’ve got everything from bachelors all the way up to doctoral programs.
They design the course based on a price that they’re going to charge at, not just the opposite. So it’s a different way of thinking and they’re able to keep it affordable.
[00:09:31] Catherine: That is such an innovative and progressive way to, approach that whole teaching and learning, paradigm, Drumm. And I think it’s really likely we’ll see a lot more of that. and it sounds very much as if they are doing exactly what we are seeing other successful universities do, which is to really understand the student that they are there to serve and what the student wants from their higher education experience, and then how to cater for that.
And of course, a lot of our universities around the world haven’t had to think about that before. You know, traditionally, they’re very much operated on the model of, if we build it, they will come. But exactly as you’ve said, that’s no longer the case. Students or potential students have so many more options, both in terms of domestic providers, but also brilliant world class online content that I can access anywhere at any time, and so where we are seeing universities that are outperforming the market, so to speak, right now, it’s absolutely those that are doing as you describe and they are really clear about who they are there to serve and then how they are going to go about creating the very best teaching and learning experience for that cohort of students. They are not there to be everything to everyone and in fact universities that try to do that are those that are going to find themselves in the greatest difficulty because it is simply uneconomical to do that.
[00:10:55] Drumm: You’re absolutely right. What I’m seeing is you’ve got 72 Ivy type universities here in the U. S. And if you include the UK, Australia, you probably got a hundred in that thing. They’re never going to have to change their business model, but everybody else is going to have to. Now let’s get into your report because it’s very telling from those type of things.
So quickly, if you would just give us an overview, there were three main areas that you looked at. There’s the funding, that’s funding of deficits. You’ve got the distinctiveness, which we just talked about, and we’ve got the digital, so let’s go through and unpack those just a little bit with your findings and some good takeaways for university
[00:11:47] Catherine: Yeah, absolutely. Thanks, Drumm, I’m happy to. So I guess the issue of funding is for universities to think a lot more, laterally around what their potential source of funding is. And of course domestic, or I guess potentially rethinking what the balance of international and domestic students is, but also how to partner with other universities as well to get scale where you may not previously have had great scale or great reach. So I guess an excellent example of that is in fact in your home in the US where we look at the example of Wheelock College which of course was a fantastic provider of education. So actually teaching teachers and it had a great K 12 and also early learning curriculum but a diminishing number of students.
By contrast, Boston School of Education, had massive student numbers, but was starting to suffer falling enrollments because it didn’t actually have a really distinctive curriculum for teaching teachers. So, those two entities merged and all of a sudden you had A best of breed program where you had both really high quality curriculum and scale to make it work.
So it’s actually, you know, the opportunity is there for university leaders to think differently and differentially about what their own strengths are and how they partner with the strengths of other providers to produce unique and differentiated offers for students that produce, ultimately financial windfalls for both as well by doing that.
[00:13:22] Drumm: remind me again, David Decker, he’s a business guy. He’s, he’s got his MBA from the Wharton School at university of Pennsylvania. He headed up a manufacturing plant, and was a president of a manufacturing company, also in higher ed as well, applying the four P’s of marketing to higher ed. I mean, to me, that’s brilliant.
[00:13:46] Catherine: Exactly. Exactly. And like for many students, of course, university is effectively a product and it is something that they purchase. and there are opportunity cost decisions associated with the decision to acquire, a higher education experience. So universities need to be abundantly clear, about what their proposition is and where they place it in the market as well. And so it’s that’s, that makes a huge difference. And of course, when they do that well, that makes a huge difference to student retention. And again, talking about a university in the US, Georgia State was really quick to cotton onto that, and they realized that by each percentage point of students that they retained at the undergraduate level, they added about another 4 million U. S. to their bottom line. So simply by better understanding their students and paying them a bit more attention and increasing their retention rates, all of those things that are the right thing to do from like a customer or student management perspective anyway, there were immediate bottom-line benefits to doing that. And again, not all of our universities are yet doing that in a way that is like what a high end consumer experience should feel like.
[00:15:02] Drumm: You brought up an interesting point just a little while ago. When you talked about the two entities coming together for world class education for teachers, a distinctive brand. I think most institutions, I may be wrong on this, most institutions resist merging or acquiring or being sold. They want to their own brand. There are other things that they can do, i. e. shared services, back end, etc. But the concept of merging to acquire programs and then to be able to brand them as unique and different. That’s a concept that I don’t think a lot of higher ed institutions have gotten to yet.
[00:15:52] Catherine: Look, I think you’re exactly right on that again. I don’t think many are there yet. I think many like to think of their brand as being. unique, or almost themselves in competition to other providers, rather than recognizing that the whole education landscape is changing. And students increasingly want to effectively be able to choose their own adventure, and go to where they can get the best higher education experience at a price point that is right for them.
[00:16:23] Drumm: Wait a minute, you said changing and higher ed in the same sentence. This is,
[00:16:27] Catherine: and awe.
[00:16:33] Drumm: But you’re absolutely right. the fundamental business model is changing, and the delivery of education many technology advancements students are different we’ve got to think about it
[00:16:48] Catherine: That’s exactly right. And we are now talking about educating students who have like literally grown up with the iPhone. the iPhone was released in 2007. You know, those kids are going to be hitting our campuses sort of any minute, now. They have grown up with digital being part of how they experience life. And again, leading universities and those that are perhaps a little more progressive in their thinking are all over that, and are very actively building digital, I guess, digital strategies to complement and supplement their other strategy documents, not instead of, but to really enhance them. And to say we now have all of these tools at our disposal that means we can have a 360 degree understanding of the student through the data analytics capabilities that we now have. And we can tailor a much more personalized experience for our students. We can actually start to deliver high quality asynchronous learning. Where, if you like, effectively the depersonalized lecture experience is something that students can consume in their own time and then the time that they have on campus with teachers and lecturers and tutors is actually spent much more in smaller tutorial groups that are conversation based and almost going back to that sort of Socratic learning style. And that’s what students want because that’s where they feel that they get those moments in a real engagement and learning and care from their teachers as well, which is something that they really want and value.
[00:18:22] Drumm: Filly Mantella who is the president at Grand Valley State University in Michigan has done something very similar to that she’s headed up a consortium called REP4, Rapid Education Prototyping for Change. And what they are doing is they’re going out and asking students, high school students, before they get to college, “what do you want your education experience to look like?” And incorporating those things. They’re asking the consumer what the consumer wants. What a novel
[00:18:55] Catherine: I don’t imagine and I can, but for any other industry, let’s say you guys, how have you guys not been doing that for decades when in any other sector that we turn to that is obviously accepted practice. But universities haven’t had to go there yet. But the fact is they have to now, if they are going to sustain themselves into the future, not just as places of research, but of places of real relevance to next gen learners as they come through our systems, because as we were saying, there are so many other alternative ways ways for learners to get access to the information that they want.
there is terabytes of world class learning available for free. that people can access now without needing to go Through all of the hoops that it takes to get into university. So universities have to be really clear about what it is that students will get from engaging with them that they wouldn’t get otherwise.
And that has to be personalised. It has to be high quality. It has to be a differentiated experience. And for most learners, it also has to be one that has a really high chance of landing them a better job than they would have got without that university experience as well. You and I probably both know academics who get a little riled when you suggest that there should be some sort of relationship between higher education and employment. But as we know, most students go to, some do, some do, absolutely. I know a number of academics, and I’m sure you do too, who are, very much of the view that, you know, just having a fabulous cerebral exercise is, a valuable thing all on its own. and no doubt that is true.
However, for the vast majority of students who go through universities, you know, that we’ve surveyed and talked to, they’re going because they expect a better employment outcome at the end of it. And again, those universities that can clearly demonstrate that, the onward trajectories of their pupils also are likely to be far more attractive to students.
[00:20:58] Drumm: So what are you seeing out there that really grabs your attention and says, “every institution ought to be doing something like this?”
[00:21:08] Catherine: So digital is very much part of it, probably no big surprise to you. But when I talk about digital, there are a whole bunch of different ways that leading universities are looking to bring digital into the university. So some of it is absolutely, in the classroom. and I actually think that, there is big role for AI to play in the classroom in supporting personalized teaching and learning.
And in some jurisdictions around the world, like Korea is one for instance, where we’re actually now seeing each student has their own AI tutor and each teacher has their own AI assistant to just really help them, you know, navigate all of the things that they need to do. But of course, there’s also the pieces around data analytics that can be applied to the way the universities run themselves. So how can they be more efficient operationally by, by using data analytics? And how can they also bring things like AI into back office operations, so that precious human time isn’t spent on answering repetitive student questions about things like parking or accommodation or fines or whatever it might be.
But all of those things that aren’t yet automated in many universities. And of course, there’s also then opportunities for all of those digital tools to massively increase accessibility for underserved learners as well. And for translation to be happening in real time. people who are suffering some sort of disability, get the real time, in time support that they need again digital tools as well.
One of the other things that we know about populations of undergraduates right around the world is that 60 percent of them have some sort of responsibility outside of university. They either have work or they have care responsibilities. So again, using digital tools to improve the accessibility of content so that every student has the, I guess, equal opportunity to access high quality content matters a lot. And when I’m talking high quality digital, content, I’m not just talking about taking,class notes from 2015 and, turning that into a lecture. So it’s not just taking your analog and making it digital. It’s actually thinking about what is the art of the possible here and how do we build in AR or VR or gaming or, quizzes or, you know, all of the other things that digital enables really fast to create those connections.
But again, in a way that is engaging and all about focusing on improving student experience and student outcomes.
[00:23:47] Drumm: Well, there’s one other factor that, that we should talk about. It’s teaching the teachers how to
[00:23:55] Catherine: it sure is.
[00:23:56] Drumm: how to produce content all of us, you know graduate school, you know, if you graduate with your PhD, you’re frequently, you know It’s not you’re gonna go into research. You’re gonna go into teaching etc. You never taught how to teach
[00:24:11] Catherine: No, and that’s such a big miss. And, and when we have surveyed students, and in fact, we’ve got a new piece of thought leadership coming out in a couple of weeks, that’s based on a survey of thousands of students around the world, asking them exactly the question you asked before.
“What do you want out of your higher education experience? And if you had like a, an unlimited . funds, what would you spend it on at your university?” The overwhelming response is on teaching teachers how to teach and teaching teachers how to use digital in a way that is engaging and supports personalised learning as well.
So that is something that students are desperate for and to them, it makes the biggest difference, between, whether or not they stick with their studies and then how well they do with their studies over the trajectory of their learning time with that university, as well.
And they don’t only want to like get an offer to be at university. Once they’re there, they want to know that their teachers care, that their teachers know who they are, that their teachers are engaged with them as individuals. And of course, digital. provides for all of those things if the teachers themselves are taught how to use them and how to provide that sort of support to students as they’re coming through the system.
[00:25:24] Drumm: Well, it’s interesting for me because when I look back at my undergraduate or I look back at my graduate work I don’t think so much about the school and everything else or the football games or all those other things. It’s always about the faculty member. I mean i remember I was a physics major for undergraduate and i had one professor, Herr Doctor Professor kalam he was german. He was the most brilliant person I have ever met, in the two, in the full year that I had him, and we’re talking quantum mechanics, we’re talking some fairly big things, I only saw him refer to his notes one time. He had all of his lectures memorized, could field any kind of question, that’s who I remember.
[00:26:12] Catherine: Yep,
[00:26:13] Drumm: that one
[00:26:13] Catherine: Absolutely. And that, that human connection is so important. It really is. And I guess no, no surprise, millions of years of evolution have produced us as, a bunch of, fairly sophisticated apes, or at least we like to think we are, but no, we are who, who are drawn to each other through moments of connection and things that we do in common. And that is how we bond. And that is how we also learn best, because that is when we feel safe. And that is when we feel valued. And when we feel both of those things, our learning is enriched, as are the rest of our human connections, as well. And so rather than actually detracting from that, digital technologies actually have the ability to enhance it, and that is what needs to be built into, university strategies. And again, those that are doing really well, and that will outpace the competition, are those that are already thinking that way. And making a real, effort to understand the journey of a student, their sort of their whole journey right from their very first open day or the very first time they click on their website through to, what they then do as alumni of that organization as well or that, that university as well and how to make sure that each of those touch points all the way along is as positive and enriching as it possibly can be. So that, that, that’s the real piece around strategic distinctiveness. It’s not just having like a fancy logo or, changing delivery on your strategy document. It’s fundamentally rethinking how you engage with the learner on your campus.
[00:27:45] Drumm: And all of the student services and advising, those are all important, but it really comes down to the relationship with the
[00:27:57] Catherine: Absolutely. Every day of the week. You are absolutely right, Drumm, you really are. And of course, and that also means that when we are talking about making changes to the university, so if we are talking about things like new partnerships, new relationships, mergers or acquisitions, you know, creating, digital strategies or whatever it is, the faculty have to be recognised and respected, as part of that change. It must be driven from within the university itself. It’s not enough just to have some fancy consultants fly in and say, ta da, here’s your new strategy and this is how it’s going to be. but it has to be driven. No, it never works. It never works in most organizations. It specifically doesn’t work in universities where you are dealing with a group of people who, value their intellectual freedom. They value their autonomy. They value, their own academic credentials. And to have these, fly by nights come in and tell them how the world is going to be. It just never works, so it’s got to be driven, internally, and, all of the workforce has to be actively involved in defining what that new future looks like, why they need to get there, and then how that’s going to happen.
And then if you want some other support to come in and, and support with particular steps along the way, fine. But again, that has to be by agreement. too, because without your academic leaders, really buying into this and being strong champions of it, it’s never going to work.
[00:29:28] Drumm: No, you’re absolutely right. I’m going to read from the conclusions
your report. Improving financial health will require universities to consider previously unthinkable options. including developing commercially focused portfolios, merging to achieve scale, or building multiple revenue streams outside the traditional funding models.
As they take their institutions on this journey, university leaders must help faculty and staff to see a different but better future. Solving for financial sustainability will stop the sector from further hollowing out. This is the light on the hill leaders can offer their institutions, to inspire them to innovate, embrace change, and venture into the unknown. I wish I’d written that.
[00:30:18] Catherine: Beautiful Drumm. Well, thank you. Thank you very much. Very easy to say, though, as we know, much, much harder to do, but it absolutely positively has to start with the people, because if the people don’t come through the rest of it will simply never succeed.
[00:30:34] Drumm: Yeah, I tell university presidents, the absolute worst feeling in the world for a leader is being out in front and turning around and seeing no one’s
[00:30:43] Catherine: Yeah, that is exactly right. And as you and I know, the best leadership actually happens from behind.
[00:30:50] Drumm: Oh, absolutely, people support what they help
[00:30:54] Catherine: That is exactly right. And I think that’s probably, never truer than when we are talking about academic leaders.
[00:31:00] Drumm: Absolutely. Catherine, this has been wonderful. Three takeaways for university presidents and boards.
[00:31:07] Catherine: Well, it’s, it’s all about your people and those are your academics and your students and your corporate office. And you have to be thinking about all of them as part of your change. And so that’s number one. So it’s your people first. People supported by digital, and thinking about new partnerships and new relationships.
and if what you’re thinking is making you uncomfortable, it’s probably right.
[00:31:31] Drumm: Oh yes. Good change is never comfortable. But it’s necessary. I’m going to throw one more in. Reach outside the organization to get a sanity check, if this makes sense, whether it be a consulting firm like mine or yours, or another president. I know a number of presidents who reach out, they’ve got friends on speed dial to say, “I’m thinking about this. Am I crazy? Or does this make sense?”
[00:32:04] Catherine: I think you are absolutely right, Drumm, and in academia more than anywhere else, we’re probably used to thinking about peer review. So, this is just another opportunity for peer review.
[00:32:17] Drumm: Yeah. And most academics I know, put up with peer review.
[00:32:22] Catherine: Maybe this is an opportunity to embrace it.
[00:32:27] Drumm: Absolutely. The way that I look at it is the pandemic gave us a lot of
[00:32:32] Catherine: Absolutely, I
[00:32:33] Drumm: Some of them we don’t want to keep, but others, it was an opportunity to start a massive change and if we embrace that, if we go along with it and say, what can it be like, what are the possibilities we can get
[00:32:52] Catherine: Completely agree with you. And this now, this is our time to completely rethink what the future of the sector is. And it is such a vital sector for society and for the future of the planet. There has never been a time when the work of universities is more vital to the future of humanity, which I know is a big statement, but I think it’s absolutely true.
So let us collectively think our way into that.
[00:33:18] Drumm: I agree. Catherine, what’s next for you besides your new report coming out in a
[00:33:23] Catherine: Well, well, thank you. So that, so there is the new report in a couple of weeks, and meanwhile, I will be keeping myself very busy, servicing my university clients in Australia and more broadly around APAC and the rest of the world as well. It’s certainly a very busy time in the sector and there’s much to do.
[00:33:39] Drumm: There certainly is. Well, I want to thank you for being on the show. I’ve thoroughly enjoyed our conversation and look forward to the
[00:33:46] Catherine: Thank you so much, Drumm. It’s been a delight to be here.