White House Chief of Staff Rahm Emanuel likes to say, “You don’t ever want a crisis to go to waste; it’s an opportunity to do important things that you would otherwise avoid.” This outlook has become the mantra of the Obama Administration. But, it is also good advice for universities.
Michael Maddock and Raphael Louis Vitón wrote in Business Week that while big business hunkered down during the recession by hoarding cash, canceling projects, and laying off staff, by contrast, entrepreneurs began new ventures with new business models--and several paid off. They urge us to learn from entrepreneurs, scrap our old business plan, and develop new business models for a very different economic reality.
The advice is good for colleges and universities, as well. But, how does a public university become entrepreneurial? After all, we have to deal with state regs, system rules, coordinating boards, accreditation, legislators, alumni and, of course, you have to build broad participation and support from faculty and staff.
John Walda, president and CEO of the National Association of College and University Business Officers (NACUBO), noted that the 'new normal' is likely to mean reduced levels of state support for higher education institutions in coming years. Wanda noted that several economists now view the recession as a 'square root sign,' where it dips sharply and moves upwards but then is flat below the old normal. Others view it as a very slowly rise U with a long flat-line.
Several economists feel that it may be 5 to 10 years before state revenues are back to where they were prior to the recession. Wanda points to data showing net declines in state revenue for the past two years of roughly $350 billion. He noted that several public universities received less state funding in 2009 than they received a decade earlier.
Like Rahm Emanuel, Wanda suggests that universities take advantage of the crisis to radically change their business model, reduce costs, find new efficiencies, strengthen the organization, and develop new strategies for the 'new reality.'
Barbara Mackoff (author of Leadership as a Habit of Mind) urged university presidents to understand the chaos we face today is an opportunity for a 'productive disequilibrium,' one that changes the way universities look at reality, alter their organizational culture, and radically change their organizational behavior. She urged presidents to 'come out of hell with something'--that is, not only surviving, but growing stronger.
Universities that move quickly to an entrepreneurial model and are proactive may avoid many of the deep cuts faced by universities in other states. Entrepreneurial universities must first focus on who they are, and be clear on their mission and vision. Together with faculty, staff, students, and other stakeholders they need to develop strategic priorities with clear plans and metrics to evaluate progress. And, they must be willing to find efficiencies and make cuts within their organization, re-adjusting to the 'new reality.'
Here are some of the other characteristics which I think are important for entrepreneurial universities. They need to be:
1) nimble and strategic--developing new degree programs and certificates based on changing needs of the market and with close advice from and consultation with industry--and, yet, strategic by aligning their budget to strategic priorities;
2) responsive to student needs--changing how they offer courses, including when, where, and how students receive those courses--whether that be at night, on weekends, at distant learning sites, on shortened schedules (one night a week or concentrated over a three-week period including weekends), or through hybrid, online, etc.;
3) future-oriented--developing and teaching courses based on competencies students will need now and in the future and by developing new degrees and majors geared to future industries and the global economy;
4) engaged--they address the problems of the society and of their university service area, build strong partnerships, engage students and faculty in learning and research that contributes to addressing societal needs, and build strong ties with and seek support from donors, alumni, industry, legislators, city and states government, federal agencies, and other friends;
5) aggressive and cooperative they identify and expand into new new markets, find distinctive niches, seek out new revenue streams, and build their university's brand--yet, they also, build partnerships, work in consortia, and leverage resources with other institutions.
UHD is still in the process of developing our goals and our vision for the future. But, we are becoming more entrepreneurial. We are reviewing our programs, reviewing how we conduct our business, and we are identifying areas where we can be more efficient. The process will take time, as we engage more of the faculty and staff in these discussions. But, our path is clear, we will grow stronger and be a better university.