Public no more universities: subsidy to self-reliance

an article by Gary C. Fethke (University of Iowa, Iowa City, USA) and Andrew J. Policano, (University of California, Irvine, USA) published in Journal of Management Development Volume 32 Issue 5 (2013)

Abstract

Purpose
Tightened government budgets are forcing public universities to confront a new economic reality as the traditional low tuition-high subsidy model of public higher education becomes increasingly unsustainable. The shift toward reliance on tuition relative to taxpayer support reflects adjustments in consumer preferences, increased mobility, enhanced competition from non-traditional providers, and reallocated government budgets. The outcome is clear: taxpayer support for higher education is decreasing, and is decreasing sharply and permanently when measured on a per student basis. The purpose of this paper is to develop a framework for university leaders that can provide the foundation for the transformation that needs to take place as universities face a permanent decline in public support. The primary goal is to point out differences between private business enterprises and public universities and then to suggest that many of the characteristics that define private sector excellence are applicable, often with modest modifications, to higher education.

Design/methodology/approach
The paper discusses and contrasts methodologies from the business and academic environments and suggest a hybrid framework for universities that captures appropriate business principles and provides beneficial outcomes while supporting and promoting academic excellence. It examines public university business schools as an example that provides initiatives that can be applied in many other areas of the university.

Findings
It is argued that many traditional practices in public higher education are incompatible with a changing environment that features permanent reductions in taxpayer support and greater reliance on tuition revenue from students who face attractive alternatives. There is also a changing demographic profile of applicants, many of whom require expensive remedial programs. The main result of the analysis is that a hybrid model of business and academic practices can provide a meaningful path for public universities to sustain excellence in a period of declining subsidy.

Social implications
The framework developed in this paper includes the adoption of a distinctive, focused mission with a transparent budgetary system combined with the setting of differential tuition across areas based on willingness to pay and cost factors. Implementation of this framework can lead to an increase in social welfare by increasing efficiency, lowering costs, and effectively allocating resources across the university.

Originality/value
This paper’s intent is to reach out to administrators and leaders in public higher education with an appeal to recognise that the new funding environment requires new ways of thinking about developing and implementing strategy. There is much to gain by becoming externally focused and accountable to those who are willing to pay for teaching and research, and also to recognise that vast differences in costs requires more attention by asking the fundamental questions: What products and services define our excellence and what should we not provide?

---

There is much more to poverty than addiction to drugs and alcohol

via JRF - Combined Feed by Chris Goulden

Iain Duncan Smith’s speech on measuring child poverty today [31 January 2013] focused on addiction.

While it’s a serious problem, Chris Goulden argues there is much more to poverty than addiction. The main criteria for judging any poverty strategy should be whether it is firmly grounded in evidence about what policies and practices are effective and finding the mix that provides most impact for least cost.

That’s the starting point for JRF in our new anti-poverty programme.

Continue reading

---

Are generic strategies ‘fit for purpose’ in a public service context?

an article by Ian R. Hodgkinson (Loughborough University, UK) published in Public Policy and Administration Volume 28 Number 1 (January 2013)

Abstract

The environment in which public sector organisations operate is becoming ever more volatile, with such organisations increasingly facing the dual pressures of growing customer expectations coupled with significant budget reductions.

This study presents an exploratory research model to uncover significant relationships between generic strategies and the business and social performance of public leisure providers, in an attempt to ascertain if generic strategies are fit for purpose in the public leisure sector.

The findings suggest that low cost and price-based strategies are inadequate for service delivery. Rather, a hybrid strategy – which seeks to add value while also having a cost base that permits low prices – is deemed fit for purpose in the public leisure sector, satisfying the dual strategic agenda of public leisure providers.

This study provides contributions to the strategic management, public management, and leisure services literatures.

---

Managing for local resilience: towards a strategic approach

an article by Keith Shaw (Northumbria University, Newcastle, UK) published in Public Policy and Administration Volume 28 Number 1 (January 2013)

Abstract

The term resilience is increasingly being used to capture the challenges involved in managing in ‘hard times’.

This article aims to provide one of the first empirical studies of the term’s application to local authority interventions around emergency planning and climate change: two areas in which resilience has been particularly emphasised in local policy making.

Drawing upon research undertaken in the north east of England, the article considers how local managers have understood and applied the term, the extent to which it has been developed as a coherent policy agenda, and its strategic significance.

In reframing the debate on resilience in terms of discourses of ‘recovery’ and ‘transformation’, the article examines how, in addition to informing policy realities on the ground, resilience is also a normative, politically laden term, within which conservative narratives of uncertainty, vulnerability and anxiety compete with a more radical focus on hope, adaptation and transformation.

The study reveals concerns over the term’s longevity, tensions between the different interpretations of resilience, and the lack of a coherent strategic framework within which the different discourses on resilience could be considered and reconciled.

However, the article also captures the growing importance of a resilience narrative that is seen to add value in a period of austerity, integrate key features of climate change adaptation and emergency planning, and act as a ‘strategic lynchpin’ in relation to other policy areas, such as economic resilience.

---

Ending child poverty: a right or a responsibility?

a feature article by Stephen Crossley (Institute for Local Governance, Universtity of Durham) and Tracy Shildrick (School of Social Sciences and Law, Teesside University) published in Poverty Number 142 (Summer 2012)

This year the European Union will publish its Recommendation on Child Poverty. This is expected to be based on three ‘pillars’ – access to adequate resources, access to services and opportunities, and children’s participation – and to argue for a strong rights-based approach to eradicating child poverty.

In 2011, the current coalition administration published the first government child poverty strategy in the UK. At its heart, lies a commitment to ‘strengthening families, encouraging responsibility, promoting work, guaranteeing fairness and providing support to the most vulnerable’. Stephen Crossley and Tracy Shildrick explore these two very different approaches.

Full text (PDF 4pp)

---

Higher education must adapt to avoid “perfect storm”

via Deloitte UK headlines

The 10 key challenges facing universities across the globe have been set out in Making the Grade 2011 PDF 36pp), a higher education report from Deloitte, the business advisory firm.

The report shows that higher education institutions urgently need to adapt to avoid a ‘perfect storm’ as budgets are squeezed, staff and students become harder to attract and competition heats up.

Education specialists from Deloitte firms in the UK, USA, Australia, India, Canada, France and Spain contributed to the report and outlined the areas that universities should address to improve their performance.

These were:

1. Funding – the education sector was disproportionately hit during the financial crisis with funding from government, private sector and individuals drying up. Deloitte’s report recommends universities proactively streamline business processes and back-end systems and explore new revenue opportunities.
2. Rivalry – universities face increased competition as tuition costs rise, changing demographic trend affects enrolment patterns and international study becomes increasingly popular. Deloitte urges universities to look at how they can attract students from around the world and align the education they offer with the needs of their key target groups.
3. Set priorities – Universities do not move swiftly enough to adjust internal processes and meet new goals. Many universities lack strategic budget plans, are slow to scrap unpopular programmes and do not effectively share resources across the institution. Strategic planning, rationalisation and streamlined decision making are all identified by Deloitte as key priorities.
4. Technology – Ageing technology systems are hindering information sharing and back-office systems. Students would benefit from more web-based learning, streamlined registration, enrolment and payment and better means of communication with teachers and classmates. Investing in IT and maximising the use of existing systems will, therefore, be crucial.
5. Infrastructure – Expansion of campuses and maintenance of existing facilities has become difficult or impossible. Universities should look to optimise their real estate assets through private partnerships or expanding the non-academic use of their property.
6. Link to outcomes – Vocational courses are catching up with traditional universities’ records on graduate employment and salaries. Universities will need to re-focus on vocational education, closely aligned to employers’ needs and students’ long term employment.
7. Attracting talent – Many universities lack strategies to attract talent, measure performance and enhance quality. The ageing workforce and low retirement rates disproportionately affect the sector. To recruit and retain the best staff, universities must implement comprehensive HR strategies.
8. Sustainability – While new buildings or IT projects, for example, are being made energy-efficient, more needs to be done across whole campuses. Sustainable practices in areas such as waste, transport and utilities will improve environmental performance and minimise costs.
9. Widening access – Universities can do more to supplement government-led action to improve participation from underprivileged groups. Policies such as remote learning, financial aid programmes and faculty diversity will help attract a broader range of students.
10. Regulation – The education sector is caught in the crossfire by new regulations in areas such as loan financing, transparency and migration. Universities will need to invest in new mechanisms for meeting their regulatory requirements efficiently and cost-effectively.

---