Tag: Universities

  • Universities aren’t entitled to autonomy. They have to earn it

    Universities aren’t entitled to autonomy. They have to earn it

    By Edward Venning, Managing Partner at Six Ravens Consulting.

    Not for the first time, an interventionist Secretary of State stands ready to help English universities. Not surprisingly, every item in her agenda – from regional engagement to business models – will place conditions of ‘wide-scale reform’ upon universities.

    We should reasonably worry. Not because of Bridget Phillipson, but because we have traded away our self-determination for years.

    The debate about autonomy has a certain monotheistic quality. Everyone agrees autonomy is the rock upon which knowledge is built, while vigorously sinning against it. Different governments tie finance to reform, as with Phillipson, or attempt the oxymoron of regulating academic freedom. Meanwhile, universities accept cash with strings attached from government, major donors and international students. Government generally cops the blame for this too, while we appeal to inalienable protections in the Higher Education Reform Act (HERA).

    But autonomy is not absolute or inviolable. It is not determined by functional independence or private status. It is a behaviour. It comes from actively managing a complex web of power relationships and trade-offs while protecting our control over key functions. It is built through organisational design, concerned with incentives, accountability and dynamic relationship management. The more robustly we design, the less likely our autonomy will be tested.

    As nations have found throughout history, autonomy is far from inalienable. Anton Muscatelli points out that this complex negotiation requires constant attention and re-calibration. It must be promoted through the active management of three forces:

    • to comply with state direction and societal expectation;
    • to conform with sector and industrial norms; and
    • to copy each other’s strategies.

    The three forces are not in themselves good or bad for autonomy. A minimal level of regulation protects the student interest. Good standards add value. Some strategies deserve emulation. They are forces for good to the extent to which we use them to improve our engagement with the world. These forces become toxic through neglect, uncritical or anticipatory compliance and inept execution.

    And our approach to university autonomy could certainly do with an upgrade. The defensive case is given a thorough outing by James Tooley and John Drew, in Cry Freedom: The regulatory assault on institutional autonomy in England’s universities (2024). In this entertaining beasting of the Office for Students, they draw invidious comparisons between what the regulator is supposed to do and what it actually does. They devastate Susan Lapworth’s claim that institutional autonomy can be overridden. Only a lawyer might improve (or rebut) their analysis of regulatory overreach, even if the reader wonders what, short of class action, would induce DfE and OfS to accept their recommendations.

    The sector shackles itself

    Equally, a fair-minded judge would accept that the sector’s supine approach to autonomy undermines their case for change. Our surrender of autonomy to the state for money is part of a wider readiness to sell the pass in exchange for benefit.

    No one can blame the government (or indeed any major industry or donor) for offering a Faustian pact. It is in their nature to seek control. Nor should universities be blamed for seeking patronage from the state, the market or indeed non-state actors. No one, as Jo Johnson recently argued in his report about the China question, would seriously suggest universities should disengage from the world. Instead, we need a robust, dynamic framework for engagement, exerting maximum self-determination in some areas while accepting constraints in others.

    It is worth remembering that HERA busies itself with a single dimension of autonomy. This is founded on the precept of the ‘self-critical, cohesive community of scholars’. While of central importance, academic autonomy is one of four dimensions of autonomy recognised by the European University Association. The other three dimensions (organisational, financial and staffing) represent the soft underbelly of autonomy, absent the legitimacy of the academic.

    We lack the toolkit to recognise and manage trade-offs across all four of the EUA’s dimensions. Regulatory interest in academic freedom is a clear-cut incursion on academic autonomy. The same is true of staff and student demands to end relationships with Israeli universities. Pressure on non-academic autonomy is often ostensibly internal. The University and College Union’s (UCU) Four Fights, #MeToo and Black Lives Matter have all successfully targeted the non-academic dimensions of autonomy. In fact, there is almost always a dynamic connection between internal and external forces. After all, the 1968 protests began with the right of male and female students to sleep together and ended by permanently altering university governance.

    Away from the academic space, autonomy is lost in less obvious ways.

    For example, universities cede considerable organisational autonomy through voluntary commitments to a wide range of charters, benchmarks and league tables. But each external assurance scheme concedes executive room for manoeuvre. Almost worse for a knowledge institution, they concede expertise to a third party. The schemes are regressive because they create a planning burden that small institutions cannot service. And the goalposts move without our input – all assurance schemes ratchet their criteria over time. Sometimes this means that compliance may seem tantamount to wishful thinking. Even critics get confused. At one point, the last government was simultaneously asking universities to leave some schemes (such as Stonewall’s famous Diversity Champions Programme and Athena Swan) and adopt others (such as the International Holocaust Remembrance Alliance (IHRA) definition of anti-semitism).

    Ganging up

    Autonomy can be defined as a type of managed interdependence. It is possible to collaborate with third parties and still maintain self-determination. Indeed, this may be the only way most universities can achieve the scale necessary to confront the most monumental tasks.

    Active, relational autonomy is central to effective partnership with government, industry and civil society in complex, interconnected challenges. For example, some of the biggest bets in biotech and STEM have been made as joint ventures.

    At the operational level, control over admissions and technology is rightly seen as foundational, and yet we are content for UCAS and Jisc to manage critical processes and infrastructure. Meanwhile, numerous universities have spent millions trying to build a proprietary full-stack online learning offer, while Silicon Valley spends billions on the same task. Arguably, our autonomy is weakest when we go it alone.

    This will become increasingly pressing as stressed universities contemplate the possibility of forced merger. What mechanisms will sustain their autonomy, identity and distinctiveness in the arms of a bigger institution?

    As shown by Gill Evans, much of the sector used to operate within much larger non-academic organisations, such as local government. Even the most autonomous parts of the sector were interdependent. The collegiate traditions of Oxford and Cambridge demonstrate how shared governance protects autonomy while enabling scale. Royal Charters were mostly awarded to institutions which were (then or subsequently) members of a bigger university. Group structures and formal partnerships between institutions provide varying degrees of freedom to their constituent parts, above a critical threshold of autonomy. These arrangements distribute risk and create safety in numbers, mitigating the hierarchy that makes some institutions more vulnerable than others.

    Asserting autonomy

    The sector needs more muscular collective action. Individual institutions struggle to resist pressure from regulators, funders and other stakeholders. A stronger sector voice could help establish red lines while engaging constructively with reform agendas.

    As argued in my recent debate paper, the overall ability of the sector to exert its autonomy is low compared to other sectors. This has several solutions. We need to establish a strong, leadership body across the tertiary ecosystem, robustly managing the big picture on resource distribution and regulatory burden. We need more sophisticated uses of corporate form, not just the blunt instrument of M&A. But above all, we need to recover an assertive self-confidence.

    Let’s be inspired by the private sector and our own history. The original English universities were guilds, muscular and monopolistic in behaviour. Commercial autonomy is not abstract or passive, nor does it derive in a mystical way from the capitalist impulse. It is a self-generating, assertive precondition for entering the market. If universities cannot make a positive case for self-determination, and are not inclined to exercise it, we cannot expect the government of the day – or anyone else – to respect our autonomy. Instead, we need dynamic, structured engagement with external and internal forces. Autonomy will be the result.

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  • Universities and the Teachers Pension Scheme: the time for change is now

    Universities and the Teachers Pension Scheme: the time for change is now

    Welcome back. The HEPI blog is now up and running again on a daily basis, landing in your inbox at 6:30am. (The pieces we ran over the break are available here.) If you are not already subscribed, you can sign up at the bottom of this page.

    Spaces are still open for our in-person Symposium with CBDU on Thursday 16th January: you can register here.

    Today’s piece is by Jane Embley, Chief People Officer, Northumbria University and Professor Tom Lawson, Deputy Vice-Chancellor and Provost, Northumbria University.

    The end of the Universities Superannuation Scheme (USS) pensions dispute in the summer of 2023 was the source of much relief in the sector. University employees in the scheme saw both their pension benefits restored to the levels they had been before the USS valuation of 2017 and a reduction in their contributions (from January 2024) from 9.8% to 6.1%. Employers could reverse the significant liabilities that had previously been skewing their financial statements and their contributions to USS were reduced from 21.6% to 14.5%. The Financial Times declared that ‘the cost to UK universities of providing pensions for employees is poised to fall by hundreds of millions of pounds after the sector’s main retirement plan swung into surplus after more than a decade of being in deficit’.

    But for many institutions the great pensions crisis was not over: indeed it had only just begun. For at least 80 universities, USS is not their main pension scheme, because those that gained university status through the 1992 Higher Education Act are required to offer Teachers Pension Scheme (TPS) to their academic staff. This includes institutions like Northumbria University, which has significantly developed its research intensity over the last decade and seeks to compete with other research intensives. The disparity in the costs of TPS and USS means that competition is no longer on a level playing field.

    Northumbria has more than 200 staff who are members of USS, but all of those have joined the university as existing members of that scheme. All other academic colleagues must be enrolled in TPS and cannot, at present, voluntarily become members of USS. Indeed those who join as members of USS also retain a right to be enrolled in TPS if they wish. Around 50 modern institutions employ some members of USS however the underlying requirement to make TPS available to university-employed academic staff is the same.

    Since 2023 the cost of TPS to both employees and employers has significantly diverged from USS. While employers’ contributions to the two schemes tracked one another closely until October 2019, they then began to diverge radically when TPS employer contributions rose to 23.68% while USS was at 21.1%. But in April 2024 the gulf between the two schemes became a chasm – TPS contributions rose by 5% to 28.68% as USS employer contributions went down to 14.5%.

    The difference in percentage terms is stark. But when you start to think about the financial cost for institutions it is all the more so. The pension cost (to employers) for a typical academic salary of £57,500 is £8,300 per annum for USS. For a TPS employee, it is £16,500. At an institutional level that means that for every 1000 staff earning this salary in TPS, the annual cost is £8.2 million greater than if those same employees were members of USS. For a professor earning £85,000 the difference is as much as £12,000 per full-time colleague. As Northumbria’s experience shows, these are additional costs being carried in one part of the sector for essentially the same staff.

    The situation is compounded by the nature of TPS as a scheme. Unlike USS, employers have no say in how the TPS is run and have no levers to keep employer (and indeed employee) contributions down. This is simply a cost handed down to universities by the Treasury. But unlike schools, to which the Treasury through the Department for Education provides additional funding to cover TPS cost increases, universities receive no relief and simply have to absorb these costs into their already stretched budgets. And unlike schools in the independent sector, which were permitted to stop offering TPS to new staff, universities are obliged to continue to offer TPS – whatever alternatives they can develop for their staff.

    The impact of this is extraordinary. It essentially means that in one part of the sector, it costs employers the same amount in on-costs to employ 503 staff as it costs to employ 1000 staff elsewhere. Quite apart from the burden this places on institutions, it is deeply anti-competitive.

    What then is to be done? The path forward is beset by problems. Unless there is legislative change, modern universities will be required to continue to make TPS available to all academic colleagues and, it bears repeating, will continue to have no say at all in the running of the scheme.  

    Of course, one option is to do nothing, but the finances of the sector mean the status quo is extraordinarily difficult to justify. Doing nothing embeds an unfairness that makes the government’s stated priorities for university reform more difficult to achieve. To put it crudely, it costs more for some institutions than others to employ academic staff, and as that resource is derived (at least in part) from student fee income then those institutions will require more students to fund the salaries of staff. For every 1000 staff earning £57,500 it would require all of the fees from 859 additional UK undergraduate students just to fund the difference in employer pension contributions.

    Institutions can employ new colleagues via subsidiary companies in order to give themselves the freedom to offer more affordable pensions to new employees. But this approach has many potential pitfalls. It would not help to reduce the costs in relation to existing staff, so would be slow to have any impact, and in any case it remains unclear what the status of such employees is according to HESA – which could among other things impact the ability of individuals to make a contribution to future REF exercises with the attendant implications for future funding. Employment through a subsidiary, even with all terms and conditions being the same but being out of scope for recognition within the REF, is also likely to be a less attractive prospect for employees.

    It seems likely that until solutions are found, many institutions might find themselves having to rethink their ability to participate in national collective pay bargaining. With higher pension costs and higher National Insurance contributions, it may be necessary, for now at least, for institutions to take control of salary increases to contain the total costs of employment. This is not an attractive option, but it is hard to think of any others that would be as swift and effective in containing cost increases, although of course it would come with its own industrial relations challenges.  

    Ultimately all institutions value their academic staff immensely and we want to provide access to attractive pension schemes. However, the lack of institutional control over which pension scheme can be offered, and the high, fixed nature of the employer contribution to TPS (which is not directly linked to any improvement in benefits for the individual) cannot be sustained. The timing of the current challenge could also not be worse. Institutions are grappling with a whole range of financial pressures, and as a consequence dealing with TPS remains in the ‘too hard’ box for many, not least because we genuinely cannot find the solutions without some form of intervention. But as the sustainability of institutions becomes all the more scrutinised, and as the sector needs to find financial efficiencies to address the concerns expressed by the Secretary of State for Education earlier in 2024, we do urgently need to find a way forward.

    Obliging institutions to continue to offer TPS places greater financial constraints on precisely those universities that might do the most to widen access and give greater opportunity to those from disadvantaged backgrounds as per the government’s priorities. It is an obvious unfairness that some of students will go to institutions where it is substantially more expensive to employ staff than in other institutions that are more traditionally regarded as elite. The time is now to remove this inbuilt, and presumably unintended, unfairness and end the obligation upon modern universities to offer TPS. If that happens individual institutions and the sector as a whole can begin to chart a path to a more sustainable position in the future.

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  • Brand or Bust: How Universities Can Thrive in the Face of Crisis

    Brand or Bust: How Universities Can Thrive in the Face of Crisis

    Today’s weekend reading is by Zeenat Fayaz, Director of Brand & Strategy at The Brand Education, and Brian MacDonald, Chief Creative Officer and a co-founder at Zillion.

    Pandemics, enrolment cliffs, budgets, student mental health, social media disinformation: higher education in crisis, globally, and it sometimes feels like crises are the new normal. This article explores these challenges in three key markets – the US, the UK and Canada – and proposes a change in the way universities think about communications to overcome such hardships.

    The Challenge

    Universities develop institutional strategies for growth and sometimes invest in brand strategies for perception management. However, when crisis communications are not integrated into these strategies, they can become distractions from them. Often when crises arise, neither institutional nor brand strategies are equipped to address them effectively. Nor does addressing them support either strategy.

    With crises seemingly becoming more frequent, this is an unsustainable model – the longer crises continue, the longer the distraction from institutional and brand strategies.

    The Opportunity: From Survive to Thrive

    With crisis management becoming a continual need, universities need a crisis strategy that doesn’t indefinitely distract from institutional and brand initiatives – one that allows universities to address all the audiences of the crisis with messages and media relevant to each. If this sounds like a brand, that’s because it is! We propose a new approach, a “thrive mode,” in which brand strategy elevated to equal status with institutional strategy, and crisis management is integrated into both.

    This approach transforms crises from distractions into opportunities to clarify the institution’s distinctive position and enhance its reputation.

    Survive versus Thrive: A Deeper Look

    Survive mode is a reactive approach to crises, treating each as a unique, temporary problem. It focuses on short-term damage control with transactional communication, often disconnected from overall institutional and brand strategies. Success in this mode is merely the survival of the institution and its brand reputation.

    Thrive mode, conversely, is proactive, viewing crises as opportunities to reinforce institutional and brand strategies. It aims for long-term reputation enhancement through brand-based communication that leverages institutional expertise and core values. Success is defined as emerging from crises with an enhanced reputation and stakeholder understanding, measurable by existing brand performance indicators.

    The change from survive to thrive offers numerous advantages. It allows for pre-crisis planning and offers efficiency by integrating with existing strategies. It allows for quicker, more coherent responses that align with overall brand and institutional messaging using existing brand communication tools. It involves broader stakeholder groups and leverages institutional expertise to provide a more valued response, resulting in trust and enhanced reputation beyond the immediate crisis.

    Case Studies: Putting Thrive Mode Into Action

    Survive mode has been displayed across headlines and news sites around the world since the inception of encampments and campus protests around the world since the advent of the Israel/Gaza conflict. Numerous university presidents provided testimony in front of Congressional hearings that reflected badly on their institutions. And the universities did survive, albeit with varying degrees of damaged brands, dismissed presidents, irate donors and declining applications.

    With thrive mode responses, instead of preparing, as in some cases, to offer legal testimony, consider the many different outcomes that could have been achieved by placing university experts in Middle Eastern studies, philosophy and ethics, comparative religions, history, or many other relevant fields at centre stage. Thrive mode would have prompted a response about higher education’s and individual institutions’ leadership in education on Middle Eastern issues, or how they are preparing students to participate in civil discussion and achieve breakthroughs in understanding. Such discussions would have haloed positively on these institutions by reinforcing their brand values with audiences outside the university, and by clarifying their roles in supporting dialogue, tolerance and understanding.

    Issues around academic freedom have been increasingly roiling universities in the UK, with the Academic Freedom Index (AFI) recording declines in each of the last nine years. The assessments measure interference by politicians, externally appointed management, and activists. Numerous crises have arisen involving scholarly censorship, the mainstreaming of racism and transphobia, and the stifling of academic pursuits that do not demonstrate profitable impact. The universities’ responses focused much negative attention on higher education, as a whole, and individual universities, in particular, in government, news media, and public opinion. And the responses allowed these negative stories to effectively lead the conversation, placing the universities in a reactive position. Survive mode squandered the opportunity to highlight universities’ research successes and student outcomes as well as to demonstrate leadership on important topics.

    Thrive-mode responses could have allowed institutions to talk about important discoveries that would not be possible under recent restrictions on academic freedom. About alumni who have made important contributions to the economy or society who would not qualify for student support today. About the universities’ missions and their historical relationships to government and society. About brand values that the universities rely on to drive their results. These responses would allow the universities to participate in, guide, and lead these conversations, putting their brands in positions to make an impact on important external audiences.

    With ongoing budget crises and newly imposed restrictions on the number of foreign student visas, universities in the UK and Canada are in uncharted territory. It’s not merely threatening many institutions with declines in funding, hard choices, and in some cases closure, but potentially reforming the entire higher education landscape. In a leaderless crisis where nobody knows what it will look like in the end, acting on coordinated institutional, brand, and crisis strategies effectively demonstrates leadership: with students, faculty, staff, alumni, and most importantly with the government. The opportunity is to talk about the budget crisis as a new lens through which to view the institutional strategy. A budget crisis does not change objectives like entering The Russell Group or becoming Canada’s premiere STEM educator. It may change the process of how an institution gets there – the timeline for milestones, the need for partners, the establishment of fundraising goals, etc. And brand strategy lays out ways to discuss how the crisis will affect its implementation with key audiences. This is what thriving looks like in the face of this crisis: opening and leading important conversations with governments, reassuring parents and inspiring students.

    Conclusion

    As Warren Buffett noted, “It takes 20 years to build a reputation and five minutes to ruin it.” In today’s media environment, a brand can be severely damaged in seconds. By integrating crisis management into overall institutional and brand strategies, universities can transform crises from threats into opportunities for growth and reputation enhancement. While crises may be inevitable, this framework offers a path for universities not just to survive, but to thrive in challenging times..

    Zeenat Fayaz is Director of Brand & Strategy at The Brand Education. Zeenat’s experience working with QS and THE gives her unique insight into the way institutions are evaluated and ranked. Today, Zeenat helps top-tier universities understand the power of branding and use this to enhance their global reputations. You can find Zeenat on LinkedIn here.

    And Brian MacDonald is the Chief Creative Officer and a co-founder at Zillion. He has worked on strategic, creative, and branding projects for dozens of universities in the US, Canada, and overseas. His work focuses on how branding can drive institutional revenue, and his work has raised more than $6 billion for his clients. You can find Brian on LinkedIn here.

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  • Universities need leaders at every level

    Universities need leaders at every level

    It may be the season for giving. However, it looks unlikely that universities will find a gift-wrapped solution to their financial worries under the tree anytime soon.

    There are busy times ahead for the higher education sector, what with boosting the economy, solving the evils of social injustice, and restoring civic accord to our troubled nation – as the government appears to expect. Realistically, however, most higher education institutions will be operating with reduced numbers of employees and leaner resources, for the foreseeable future. So, it is not entirely clear how this all adds up.

    In a “more for less” environment, the institutions that will survive, perhaps even thrive, will be those that are able to get the very best out of each individual. What universities urgently need, therefore, is outstanding, engaged leadership.

    Beyond the executive suite

    But just to be clear, when I say “leadership”, I am not talking about stronger, tougher, more detailed decision-making at the top. With the best will in the world, the ten people who sit in the executive suite on a Tuesday morning with a pot of coffee can only do so much.

    However, what can have a transformative impact on organisations is a willingness to mobilise, align and empower a distributed network of leaders at every level of an organisation to motivate, support and develop their staff, so that everyone can achieve more.

    This isn’t a new idea. From Peter Drucker in the 1960s, through to more recent work by Martin Seligmann, Michael West, Brené Brown, and many others, the published wisdom on organisational psychology tends to show that command-and-control styles of directive authority are less effective than positive and collaborative methods of leading that harness knowledge and creativity across an organisation. This is especially so when responding to cultural issues and “wicked problems”. We might have a few of those.

    This is not to say that everyone should get a vote on everything all the time. Nevertheless, the working principle that, within agreed limits, decisions should be taken as close as possible to the actual activity is a good one – and might well save time, money and trouble.

    Leadership skills

    Nobody says this is simple. Devolving decision-making calls for high levels of trust, skill and communication across leadership teams and for attention to personal development. The Institute of Leadership, a membership organisation with 75 years of experience in this game, identifies 49 principles of leadership, ranging from adaptability, and dealing with conflict, to ethics, managing upwards and resilience. (Anyone who has ever chaired a department meeting will probably have required most of these abilities before reaching item four on the agenda.)

    Cappfinity, a global talent lifecycle management company, deeply embedded in global industry with 20 years of research, lists no fewer than 80 key workspace skills, highlighting eight “altitude leadership” strengths: agile thinking, relationship navigation, accountability, self-insight, inclusive leadership, courage, strategic vision and change facilitation. Surely, more of these things in daily university life could only help, whatever the next big policy change might be.

    As a sector, and with some external prompting, universities and other higher education providers have recently become much better at articulating, assessing and developing employability skills for students.

    However, there’s still some way to go on helping staff to identify, understand and optimise their technical, cognitive and behavioural strengths (to borrow a taxonomy from Cappfinity). Of course, some colleagues already display these skills; others clearly need to learn them. All too often, people in our organisations do have remarkable qualities and abilities, but don’t have the opportunities or the motivation to use them. These unrealised strengths constitute a potentially rich resource for universities, especially when other kinds of resource are in short supply.

    Abi Parker of Cappfinity points out that tapping into these abilities can make a profound difference:

    With skills development, at every level, everything starts with self-insight. What’s special about leadership development is that any positive movement is amplified, meaning that as a lever for improving organisational effectiveness, leadership development is a great place to start. This is especially true in difficult times.

    The marzipan layer

    If only there was a pan-institutional network of experienced colleagues able to communicate effectively, to take responsibility at local level, to promote strategic objectives, to motivate and support employees, and to innovate appropriately without excessive investment or risk.

    Ah, yes. Right. So, the good news is that universities already have these highly developed internal structures in both academic and professional services teams, in the form of deans, directors, heads, section leads and their deputies. The bad news is that our large, bureaucratic institutions can sometimes ignore and elide what is going on at this level, or these leaders can end up overwhelmed and discouraged, unsure how to manage the apparently competing demands of their own staff and the senior team.

    As Mark Smith, vice chancellor at the University of Southampton, observes:

    The crucial layer of leadership in an institution is the senior leadership of academic departments and professional service directorates. If this layer is not trusted, empowered and sufficiently skilled there is relatively little those further up can do to bring about change.

    This “marzipan layer”, as governance adviser Seamus Gillen of Value Alpha has memorably described it, may become more important than ever as universities navigate the more-for-less maze that lies ahead.

    Not everyone loves marzipan, I know, but something has to hold together the crusty royal icing and the crumbly yet delicious fruit cake – just as someone has to localise change initiatives and restructures, to support individuals through difficult contract negotiations, to locate and realise efficiencies, to manage workloads, to resolve conflicts, and to ensure that somehow, against all odds, students continue to get the best possible education.

    Thinking more expansively, if universities really are going to play a greater role in society, boost economic growth, drive new knowledge and be more active in cities and regions – I believe and hope they can – then it will be at the level of local leadership that new partnerships will be maintained, inequalities will be gradually eroded, and innovative models for education delivery will evolve.

    As Gillen observes, for some people, the marzipan is the best bit:

    Just because it’s squeezed in the middle doesn’t mean it’s all bad. If Deans and ‘Heads of’ could be empowered, and feel empowered, they could, would and can transform an institution’s future.

    So, as you cut yourself a festive slice, consider that nurturing leadership competencies and behaviours at all levels of our knowledge industry might be the smart place to put your time and energy in the year ahead. Developing teams and individuals won’t provide a quick solution, but it will create the conditions from which future solutions for the sector can emerge. After all, we’re in the education business. Enabling and empowering people is what we do.

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  • Universities want more money upfront. DfE wants proof students are really there

    Universities want more money upfront. DfE wants proof students are really there

    When students get their student maintenance loans, they get the first instalment a lot earlier than their university gets the corresponding tuition fee payment.

    That might help explain the curious case of disparities between pulldown – but there’s a sound theory to it. Students without savings could face a cashflow issue if it was any other way.

    It’s becoming a problem for universities too. The Office for Students’ (OfS) financial sustainability update report highlights low liquidity levels in the sector – especially during certain points in the annual cycle.

    That matters because universities have to meet minimum liquidity requirements in the registration conditions in England. A failure to maintain those levels can also impact “going concern” status and breach some lending covenants.

    In the past, cash flow imbalances tended to be offset by other income sources, borrowing, or cross-subsidies, such as from international student fees.

    But given how universities operate and the demands on cash before those SLC payments come in, there is in some providers a disproportionate reliance on arrears payments from SLC-funded students compared to other funding sources.

    For non-SLC funded students, universities typically charge fees upfront (or at least in front-loaded advance instalments) or get payments for stuff like government-funded apprenticeships monthly. Research funding streams also match payments to incurred costs.

    But the SLC’s payment profile for undergrads is 25:25:50 – so universities face significant upfront costs in the first two terms and then wait longer than standard 30-day payment terms to receive funds, forcing them to bridge the gap using other resources.

    So the University Alliance has a proposal – switch those payments to 40:40:20 to improve the sector’s funding position:

    Even if the move was phased first to 33:33:33 and then to 40:40:20 it would have an immediate impact on the current situation which has been adversely impacted by the previous administration’s approach to international student recruitment through restrictive visa policies.

    The current system is going to have to undergo change anyway, given the potential implications of the LLE. I note in passing that one of the most common student leader manifesto goals this year is better, less front-loaded instalments – surely the principle (and the issue in terms of cashflow) cuts both ways.

    But UA’s proposal might not land in quite the way intended – partly because the Student Loans Company is under pressure to increase yield.

    Leakage

    DfE’s “Tailored Review” of the Student Loans Company back in July 2019 talked of the rapidly increasing size of the student loan book, and the increasing importance and value of having a robust, well-resourced and effective repayment strategy which actively seeks to maximise yield.

    That said that the SLC is hamstrung by IT systems which do not “adequately facilitate the use of smart diagnostics for effective modelling, proactive use of data analytics and more precise customer segmentation” to minimise repayment leakage:

    Indeed, unverified customers account for c. £7bn of uncollected repayments (although many of these would not be in a position to repay)

    September’s SLC board minutes noted that its CEO had been along to DfE’s Audit and Risk Committee, where the department led an item on the student finance loan book, with an emphasis on its “scale and yield potential”.

    And its newly published Business Plan for 2024-25 says it will work with partners in DfE to progress proposals to “improve repayment customer verification rates”, “improve data quality to increase verification and yield” and look at options to apply stronger sanctions to customers not adhering to the terms and conditions of their student finance repayments.

    Some of that is about the SLC’s systems – but one of the problems noted in the National Audit Office’s report into franchising is that there is often “insufficient evidence” that students are attending and engaging with their courses:

    In determining a student’s eligibility for loan payments, and before making payments, SLC uses lead providers’ data to confirm students’ attendance. Lead providers self-assure their own data… there is no effective standard against which to measure student engagement, which attendance helps demonstrate, and there is no legal or generally accepted definition of attendance. Providers themselves determine whether students are meaningfully engaged with their course.

    So in a set of circumstances where the NAO and the Public Accounts Committee (PAC) are already worried about attendance and engagement, and providers are worried about their own cashflow, it seems unlikely that DfE is going to be receptive of a proposal to give providers more of the money early – especially if, in the case of franchised provision, it can’t just claw it back from the lead provider if there’s a problem like the Applied Business Academy.

    As we noted back in October, the government’s response to the NAO and the PAC was that it published guidance on attendance management in May, against which providers can be held to account “in relation to the release of SLC tuition fee payments”.

    That said that there is an “understanding and acceptance” across the sector that providers should have in place published attendance and engagement policies, so that students understand the commitment expected of them and the respective process a provider follows if attendance expectations are not met.

    It also said that in any circumstance where a provider does not have a published policy, the department “expects” that one will exist from the 2024-25 academic year – but it’s pretty clear talking to people around the country that that goal hasn’t been meaningfully met in large parts of the sector, at least in terms of a policy that both covers home students and is “auditable”.

    And part of the difficulty there is what is or isn’t meant by “attendance”.

    Attending isn’t always in person

    The Attendance Management guidance says:

    Attendance means participation in a course by a student, including, but not limited to, teaching face-to-face or blended study, in line with a provider’s published attendance policy. A provider should communicate its policy to a student and have an auditable process in place to support the action it may take when a student does not meet attendance expectations.

    It goes on to say that providers have flexibility to ensure every student engages with a course, and that the student and/or the course may require greater or less attendance than another due to circumstances or content.

    SLC told me that there is no difference between “attendance” and “engagement” – the definition of “attendance” for student finance purposes is active and ongoing engagement. Crucially, it said that “attendance” doesn’t have to mean “in person”, or “studying on campus”.

    But the conflation of “attendance” and “engagement” doesn’t seem to apply when a course is designed and designated. Noting that “blended learning” combines traditional classroom teaching with online learning and independent study, it says that there has been some confusion as to whether these courses should be coded as distance learning courses:

    Courses of any teaching method are distance learning if the students only attend occasionally, for example once a term. If students attend regularly, for example once a week, and follow a structured timetable, the course is not distance learning and you should not add it to CMS as such.

    That paragraph draws a clear distinction between attendance and engagement. Its two scenarios also appear to draw a distinction between (physical) attendance and “engagement”:

    • Scenario 1: Thomas is studying a BA Hons in sports coaching. His course hours are 30 weeks online study including lectures and tutorials, 2 days per week physical attendance at sports academy, 6 days per year attendance at university. As Thomas needs to attend the sports academy regularly rather than occasionally, this is an in-attendance course.
    • Scenario 2: Kate is studying an HND in Musical Theatre. Her course hours are 30 weeks online study including lectures and tutorials, 3 days per year (1 day per term) attendance at college. As Kate only needs to attend college occasionally rather than regularly, this is a distance learning course.

    The difference between Scenario 2 and the patterns of attendance being seen by many providers around the country this term is that in that scenario, the course is designed not to include regular physical attendance.

    A two-stage process

    SLC told me that whether it’s distance or in-person, engagement on a course is required and confirmation of that engagement is therefore required for SLC to make a fee loan payment on the student’s behalf.

    Ongoing engagement is not part of the definition of in-person or distance learning. That distinction relates to the attributes of the course that is supplied by the provider, as to whether the course has elements of in-person learning or if the student is not required to be in-person.

    But the obvious question is as follows. Notwithstanding codified exemptions for disabled students, if a course is designed as blended, would an acceptable “attendance management” policy for a course of that sort allow a student to engage all term, but only occasionally physically attend?

    If yes, and Kate’s HND wasn’t designed as blended, and her mate Kathy was on a course that was designed as blended, that would seem to mean that they could both have exactly the same attendance and engagement pattern, but Kathy would get a maintenance loan while Kate wouldn’t.

    If, on the other hand, a course was designed as blended and requiring regular in-person attendance, and SLC would expect an attendance/engagement policy to enforce that regular in-person attendance, there’s plenty of providers right now falling foul of those expectations.

    So you end up with three categories:

    1. Providers who’ve never really had a proper policy on any of this for home students – let alone enforce one – beyond noticing if a student doesn’t submit what can often be end-of-year summative assessment.
    2. Providers who designed a course as blended where students are in reality engaging in a “distance learning” kind of way – which, while confirming engagement in accordance with the rules, seems hugely unjust to tens of thousands of OU students if nothing else.
    3. Providers who are heavily auditing and requiring physical attendance – partly to achieve parity with international students – at just the point that students are struggling to attend in-person given wider demands on their time.

    It may well be the case that SLC is stuck with the definitions it has – which in part date back to the Teaching and Higher Education Act 1998.

    But if it’s the case that it’s OK for an attendance policy to not actually require regular in-person attendance, it’s hard to believe that whatever size and shaped-problem that DfE and the SLC have with student loan fraud is going to get anything other than worse.

    And in the end, this all comes back to an old problem – not knowing what’s going on underneath headline non-continuation.

    How far in?

    Remember those risks that OfS identified in its insight brief on subcontracting:

    • Data of extremely poor quality has been submitted in relation to students at some subcontractual partnerships, leading to payments being made to, and on behalf of, students who are not genuinely entitled to them.
    • Delivery partners have lacked clear attendance policies, making it almost impossible for lead providers to submit accurate data to the OfS and the SLC in relation to these students.
    • Students have been encouraged to register for courses that they do not genuinely intend to study, to access public funding through maintenance loans. In some cases, students have withdrawn from courses shortly after receiving these funds; in others there are grounds to doubt that they are continuing to study, despite their termly attendance being confirmed.

    Whether we’re looking at a select group of partnerships as OfS published data on last week or directly taught provision, while we know what percentage of UG students don’t make it to the second year, we don’t know what proportion:

    • Got instalment 1 of the maintenance loan but didn’t get as far as “engaging” enough for the provider to claim instalment 1 of the tuition fee loan (they don’t show up at all in non-continuation)
    • Engaged enough to enable the provider to claim instalment 1 but not enough to enable the provider to claim instalment 2 (and what proportion of them claimed maintenance instalment 2)
    • Engaged enough to enable the provider to claim instalment 2 but not enough to enable the provider to claim instalment 3 (and what proportion of them claimed maintenance instalment 3)
    • Engaged enough to enable the provider to claim instalment 3 but then failed and was withdrawn
    • Engaged enough to enable the provider to claim instalment 3 and was eligible to progress but then self-withdrew
    • And we don’t know any of the above for subsequent years of study.

    In many ways, what we have here is (yet) another iteration of the stretch involved in a single level playing field. There have been endless tales down the years of Russell Group alumni not really “engaging” at all for entire years, and in some cases entire degree courses – only to pull it out of the bag at the end. It’s an adult environment, after all.

    On the other hand, with another part of the sector now under close scrutiny over ghost students of differing definitions – just as the FE sector saw scandals over in the 90s – it doesn’t feel like that kind of legend is to be allowed.

    In terms of the cashflow thing, if DfE and the SLC are going to push more of the money upfront, they’re surely going to want to know the percentages and numbers in each of the above categories.

    And the accuracy of those percentages and numbers involves providers being sure about “enough” engagement – in an auditable way across the diversity of programmes and reasonable adjustments – to tick the box in the data return to SLC three times a year.

    It does feel like there’s some distance to go on all of that as it stands.

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  • Twenty six years of enrollment at Public Research 1 Universities

    Twenty six years of enrollment at Public Research 1 Universities

    A while ago, I made the claim that Oregon State University has the longest streak of consecutive years of fall-over-fall enrollment growth of any public, Research 1 university in America.  A few people have asked me, not exactly doubting the claim, but thinking maybe I had made a mistake, for the source of it.

    This started as a curiosity: I knew from our own internal documentation that the last time OSU (the oldest OSU…not the one in Ohio or Oklahoma) had a fall-to-fall enrollment drop was 1996, and I was curious to see if any other institution could make that claim. So I went to the IPEDS Data Center and downloaded the data. 

    It’s below.  First, a few points: My comparison group is 108 Public, four-year, Research 1 Universities as designated by the Carnegie Commission on Higher Education as of Fall, 2022, the latest IPEDS data available. The R1 designation is actually called “Doctoral Institutions: Very High Research Activity” but the nickname R1 is a holdover from prior years. The category contains those institutions who produce the highest research activity and output among American universities.

    What you can’t see here is that 2023 showed an increase (it’s not yet in IPEDS, but trust me), and that 2024 will also show an increase once our census is final.  So OSU’s record is the 26 shown, plus last year, plus this coming year, for a total of 28 years.

    There are a couple of small anomalies with the data, as there always seems to be.  First, some institutions missed a year or two in their reporting.  Even if those years had shown an increase, they were already nullified by other decreases. And Penn State has bounced around from being one institution to being several to being one again; this too does not seem to make a difference in the tally.

    The first chart here shows all years and all institutions (you’ll have to scroll down to see them all using the bar on the right.)  You’ll notice that every institution shown (other than OSU) has at least two years with a blue box after 1997, meaning a decrease.  Hover over the box for details.  Orange shows an increase from the prior year.

    The second chart shows individual enrollment data for any institution you select, using the filter at the top.  The bars are colored similarly: Orange for increase, and blue for decrease.

    If I’ve missed something or you think these data points are wrong, let me know.  If a university decided intentionally to shrink, for whatever reason, that’s interesting, but not the point of this visualization. If you want to look at just graduates or undergraduates or men or women or students of color or some other variable, I encourage you to read my posts here and here about how to download IPEDS data for yourself. 

    And as always, leave a comment below if you find something interesting.

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  • Six-year graduation rates at four-year colleges and universities

    Six-year graduation rates at four-year colleges and universities

    Graduation rates are always a hot topic in higher education, but often for the wrong reason.  To demonstrate, I offer my parents.  Here is a portrait of Agnes and Mark, married May 4, 1946.

    One night while I was talking to my brother, he asked, “Do you think mom was the way she was because dad was the way he was, or do you think dad was the way he was because mom was the way she was?”  To which I replied, “yes.”  My point, of course, is that in complex relationships, it’s always difficult–impossible, actually–to detangle cause and effect.

    And, despite the Student Affairs perspective that graduation rates are a treatment effect, I maintain that they are actually a selection effect.  As I’ve written about before, it’s pretty easy to predict a college’s six-year graduation rate if you know one data point: The mean SAT score of the incoming class.  That’s because the SAT rolls a lot of predictive factors into one index number.  These include academic preparation, parental attainment, ethnicity, and wealth, on the student side, and selectivity, on the college side.

    When a college doesn’t have to–or chooses not to–take many risks in the admissions process, they tend to select those students who are more likely to graduate.  That skews the incoming class wealthier (Asian and Caucasian populations have the highest income levels in America), higher ability (the SAT is a good proxy for some measure of academic achievement, and often measures academic opportunity), and second generation.  And when you combine all those things–or you select so few poor students you can afford to fund them fully–guess what?  Graduation rates go up.

    If this doesn’t make any sense, read the Blueberry Speech.  Or ask yourself this question: If 100 MIT students enrolled at your local community college, what percentage would graduate? 

    But graduation rates are still interesting to look at, once you have that context.  The visualization below contains three views, using the tabs across the top.  You’ll have to make a few clicks to get the information you need.

    The first view (Single Group) starts with a randomly selected institution, Oklahoma State.  Choose your institution of choice by clicking on the box and typing any part of the name, and selecting the institution. 

    On the yellow bars, you see the entering cohorts in yellow, and the number of graduating students on the blue bars.  Note: The blue bars show graduates in the year shown (so, 4,755, which you can see by hovering over the bar) while the yellow bar shows the entering class from six years prior (7,406 in 2019, who entered in 2013).

    The top row shows graduation rates at all institutions nationally, and the second row shows percentages for the selected institution.  You can choose any single ethnicity at the top left, using the filter.

    The second view (Single Institution) shows all ethnicities at a single institution.  The randomly selected demonstration institution is Gustavus Adolphus College in Minnesota, but of course you can choose any institution in the data set.  Highlight a single ethnic group using the highlight function (I know some people are frightened of interacting with these visualizations….you can’t break anything).

    Note: I start with a minimum of 10 students in each year’s cohorts for the sake of clarity.  Small schools in the Northeast, for instance, might enroll one Asian/Pacific Islander in their incoming class, each year, so the graduation rate could swing wildly from 0% to 100%.  You can change this if you want to live dangerously, by pulling the slider downward.

    The final view (Sectors) shows aggregates of institutional types.  It starts with graduation rates for Hispanic/Latino students, but you can change it to any group you want.

    Have fun learning about graduation rates.  Just don’t assume they are mostly driven by what happens at the institution once the admissions office has its say.

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  • Average Net Price at America’s Public Colleges and Universities

    Average Net Price at America’s Public Colleges and Universities

    Good news: We have new IPEDS data on average net cost.  Bad news: Because IPEDS is IPEDS, it’s data from the 2021-22 Academic Year. 

    This is pretty straightforward: Each dot represents a public institution, colored by region, showing the average net price for first-year students entering in that year.  IPEDS breaks out average net price by income bands, so you can see what a family with income of $30,000 to $48,000 pays, for instance, by using the filters at right.

    You can also limit the institutions displayed by using the top three filters: Doctoral institutions in the Far West, or in Illinois, for instance.  If you want to see a specific institution highlighted, use that control.  Just type part of the name of the institution, like this example, and make your selection: 

    Average net price shows The Total Cost of Attendance (COA), which includes tuition, room, board, books, transportation, and personal expenses, minus all grant aid.  It does not include loans, but of course, loans can be used to cover part of the net price, along with other family resources.

    This display is a box and whisker chart, and if you’re not familiar with the format, here is a quick primer: 

    For the sticklers, the median shown is unweighted.

    As always, let me know what you see here that you find interesting or surprising.

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  • First-year student diversity in American colleges and universities, 2018-2022

    First-year student diversity in American colleges and universities, 2018-2022

    I started this visualization to show how first-year classes at the highly rejective colleges had changed since COVID-19 forced them all to go to a test-optional approach for the Fall of 2021.  But it sort of took on a life of its own after that, as big, beefy data sets often do.

    The original point was to help discount the conventional wisdom, which is propped up by a limited, old study of a small set of colleges that showed test-optional policies didn’t affect diversity.  I did this post last year, after just one year of data made it fairly clear they did at the institutions that had the luxury of selecting and shaping their class. 

    This year I took it a little farther.  The views, using the tabs across the top, show the same trends (now going to 2022) for Public Land Grants, Public Flagships, the Ivy and Ivy+ Institutions.  In each case, choose one using the control.

    Note that I had colored the years by national trends: 2018 and 2019 are pre-test optional, gray is COVID, and blue is post-test optional.  This is not to say that any individual college selected either required tests or went test-optional in those years, but rather shows the national trend.  And remember these show enrolling students, not admitted students, which is why gray is critical; we know COVID changed a lot of plans, and thus 2020 may be an anomalous year. 

    The fourth view shows where students of any selected ethnicity enroll (again, use the dropdown box at the top to make a selection); the fifth view breaks out ethnicity by sector; and the final view allows you to look at diversity by sector and region (to avoid comparing diversity in Idaho, California, and Mississippi, for instance, three states with very different racial and ethnic makeups.)

    On all views, hovering over a data point explains what you’re seeing.

    If you work at a college or university, or for a private company that uses this data in your work, and want to support my time and effort, as well as software and web hosting costs, you can do that by buying me a coffee, here. Note that I won’t accept contributions from students, parents, or high school counselors, or from any company that wants to do business with my employer.

    And, as always, let me know what jumps out at you here. 

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  • Tuition and Fees at Flagship and Land Grant Universities over time

    Tuition and Fees at Flagship and Land Grant Universities over time

    If you believe you can extract strategy from prior activities, I have something for you to try to make sense of here.  This is a long compilation of tuition and fees at America’s Flagship and Land Grant institutions.  If you are not quite sure about the distinction between those two types of institutions, you might want to read this first.  TLDR: Land Grants were created by an act of congress, and for this purpose, flagships are whoever I say they are.  There doesn’t seem to be a clear definition.  

    Further, for this visualization, I’ve only selected the first group of Land Grants, funded by the Morrill Act of 1862.  They tend to be the arch rival of the Flagship, unless, of course, they’re the same institution.

    Anyway, today I’m looking at tuition, something you’d think would be pretty simple.  But there are at least four ways to measure this: Tuition, of course, but also tuition and required fees, and both are different for residents and nonresidents.  Additionally, you can use those variables to create all sorts of interesting variables, like the gap between residents and nonresidents, the ratio of that gap to resident tuition, or even several ways to look at the role “required fees” change the tuition equation.  All would be–in a perfect world–driven by strategy.  I’m not sure I’d agree that such is the case.

    Take a look and see if you agree.

    There are five views here, each getting a little more complex.  I know people are afraid to interact with these visualizations, but I promise you can’t break anything.  So click away.

    The first view (using the tabs across the top) compares state resident full-time, first-time, undergraduate tuition and required fees (yellow) to those for nonresidents (red bar). The black line shows the gap ratio.  For instance, if resident tuition is $10,000 and nonresident tuition is $30,000, the gap is $20,000, and that is 2x the resident rate.  The view defaults to the University of Michigan, but don’t cheat yourself: Us the filter at top left to pick any other school. If you’ve read this blog before, you know why Penn State is showing strange data.  It’s not you, it’s IPEDS, so don’t ask.)

    The second tab shows four data points explicitly, and more implicitly.  This view starts with the University of Montana, but the control lets you change that.  On top is resident tuition (purple) and resident tuition and fees (yellow). Notice how the gap between the two varies, suggesting the role of fees in the total cost of attendance.  The bottom shows those figures for nonresidents.

    The third view looks a little crazy. Choose a value to display at top left, and the visualization will rank all 77 institutions from highest to lowest.  Use the control at top right to highlight an institution to put it in a national context.  Hover over the dots for details in a popup box.  If you want to look at a smaller set of institutions, you can do that, too, using the filters right above the chart.  The fourth view is the exact same, but shows the actual values, rather than the rank.  As always, hover for details.

    Finally, the fifth view is a custom scatter plot: Choose the variable you want on the x-axis and the variable to plot it against on the y-axis.  Then use the filters to limit the included institutions. As always, let me know what you find that’s interesting.

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