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GLOBAL: Push towards innovative funding methods

Shrinking state budgets and financial shortfalls linked to the global recession are forcing universities to devise new means of raising revenue, notably through increased interaction with the private sector, according to participants at last month's OECD higher education conference in Paris.

The accelerating push towards public-private partnerships and other innovative funding methods was one of the principal themes during the OECD's Institutional Management in Higher Education conference from 13-15 September, titled Higher Education in a World Changed Utterly: Doing more with less.

The three-day event brought together more than 500 government officials and education experts from 70 countries for discussions around the concept of 'doing more with less', which consensus opinion saw as an unfortunate reality in the post-economic crisis world.

A range of speakers presented research on greater collaboration between educational institutions and the private sector, prompting discussion on how such programmes will change education systems for better or worse.

Ingo Rollwagen, a vice-president and senior analyst with Germany's Deutsche Bank Research, suggested that "a project economy is taking root" at German universities.

Higher education institutions, and particularly upper-tier research universities, are increasingly partnering with industry to design classroom and laboratory projects that are both profitable for the institution and relevant to the private sector, Rollwagen said.

Applied sciences departments have taken the lead in project-oriented university programmes, spurred by investments from German industry. These intensive project-oriented partnerships are boosting research funding, and bringing profit motive into the lab, by allowing researchers to 'valuate' their intellectual property, Rollwagen continued.

"We are definitely seeing that partnering can help higher education institutions do more with less."

Going forward, Rollwagen predicted that the move to project-oriented higher education institutions could include tailor-made degree or qualification programmes designed in conjunction with employer organisations or industry councils to meet recruiting needs.

They would also involve a wider use of work-study programmes that combine theoretical and research education with applied training in the workplace; and research partnerships designed to create value and make better use of resulting intellectual property.

Project-oriented education was "in its infancy", Rollwagen said, but could eventually lead to wide-ranging new sources of third-party funding for universities across a much broader range of academic departments.

Philip Nolan, registrar, deputy president and vice-president for academic affairs at Ireland's University College Dublin, said administrators had heard the call for a project-driven university.

"We do have to pay more attention to the entrepreneurial economy," Noland said, also noting that "there are faculty who want this, and who are telling us they'll leave if we keep going without it".

But Nolan also recognised that project-oriented and profit-driven universities will face fundamental challenges, notably concerning 'merging' this new approach with traditional liberal arts programmes.

However, Rollwagen's vision of a project-oriented university system predicts high levels of autonomy for individual academic departments.

Michael Klein, director of government and legal affairs for the US's New Jersey Association of State Colleges and Universities, presented a 'bigger picture' American perspective on creating what he called an 'entrepreneurial university'.

Klein's presentation detailed continuing efforts to diversify revenue at New Jersey's Rowan University, including greater reliance on fee-based graduate, adult and continuing education, greater valuation of intellectual property, and public-private partnerships.

"There has to be buy-in to get the university community to participate in entrepreneurial plans," Klein said, adding: "Money is a great buy-in factor."

Fees from Rowan's expanded graduate, adult and continuing education programmes are being used to support travel expenses no longer covered by state funding, while public-private partnerships are supporting entire segments of university research.

Much of Rowan University's private sector partnerships are managed through the Roher Business Incubator, which has funded US$20 million worth of projects in recent years.

The incubator is supporting staff-led start-up companies that give engineering students hands-on experience working on products in university research labs and MBA candidates the opportunity to design real-world business plans.

Most importantly for Klein, "in the incubator, students are applying their skills to real-world business needs".
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