US: The business of higher education

In recent years, colleges and universities have encountered increasing pressure to operate like businesses. As the logic goes, businesses must survive in a cutthroat climate of unfettered competition and, thus, their organisations need to be leaner, more efficient and more responsive to the needs of their customers than not-for-profit organisations, such as colleges and universities.

In the unforgiving crucible of free market competition, only the fittest businesses (for example, those that deliver the highest quality products at fair market value), will survive. Of course, the seemingly endless government bail-outs following the 2008 financial crash cast a dubious light on the above claims, nevertheless, the notion that higher education should embrace a more business-like organizational philosophy remains deeply entrenched.

Colorado State University's recent hiring of its first system chancellor offers an illuminating example of this sensibility in practice. On 6 May, the university's board of governors announced the hiring of Joe Blake as its system chancellor although it is fair to say Blake was a somewhat curious choice.

Although he claims extensive contacts in the Denver business community (his most recent job was President of the Denver Metro Chamber of Commerce), his resumé is conspicuously devoid of academic credentials.

Indeed, in assembling its search committee, the governors intentionally excluded faculty and student representatives. In response to protests concerning the committee's limited composition , Michelle McKinney, a public relations representative for the board, stated baldly: "Search committee members were chosen for their knowledge and understanding of complex, billion dollar businesses."

In other words, from the perspective of the governors, Colorado State University is a business. Therefore, when it comes to choosing the university's leaders, the governors considers input from successful businesspeople to be more pertinent than the opinions of academics.

Viewing these events through the most optimistic lens, one could argue that vast changes are in the offing for higher education. In an information society, college degrees have become an ever more essential ingredient for success. Yet, indispensable as college degrees may be, with each passing year, students encounter more difficulty gaining access to and completing higher education.

Escalating costs coupled with reduced public funding have shifted the burden of finance on to individual students. As they face the prospect of accumulating home mortgage-sized debt over the course of their college careers, many gifted but financially-strapped students will have no choice but to forgo higher education.

Somehow, educators must find the way to change that dynamic: college and university leaders must make higher education more affordable--and soon! Insights from the business realm will certainly be helpful as business leaders are only too well aware of the hazards of running foul of consumer expectations.

When a valued good becomes excessively overpriced, consumers tend to take their buying power elsewhere. As a case in point, consider the Big Three US automakers. Not long ago they were the titans of industrial America but, having fallen out of step with their customers, they hit upon tough times. Once again, in a free market society it behoves organisations to deliver the highest quality products at affordable prices. Consumer loyalty is not inexhaustible.

Indeed, higher education must change to meet the needs of its 21st century students. Fortunately, higher education has undertaken a variety of initiatives to achieve precisely that: most US colleges and universities have implemented flexible degree programmes to permit students with limited time and extensive non-academic responsibilities, such as full-time jobs, family obligations, military service and so on, to progress toward college degrees at a pace that suits their lifestyles.

Many universities have also employed the latest technologies in an effort to reach out to place-bound students. Thus, many who lack the necessary mobility and wherewithal to pursue a traditional on-campus education can still procure college degrees via online or virtual higher education opportunities.

Changing times have dictated that higher education must also change. So far, higher education has responded admirably. Yet, as with all successful institutions, to ensure ongoing success, it must constantly seek ways to reinvent and improve itself.

Still, as planners look to the future, it is important to consider the strengths and weaknesses of higher education in as broad a framework as possible. Much as it can benefit from the insights of business leaders, higher education is not a business, nor should it ever become one.

While higher education can and must establish synergies with business in many ways, business and higher education are distinct pursuits. Business is a for-profit activity whereas higher education is a not. This is because education is not a commodity; one cannot purchase an education the same way that one might purchase a pair of snow tires, it is an investment that requires years of patience, diligence and perseverance before one can hope to reap a windfall.

Certainly, education is not cheap: it has taken an enormous investment to lay the educational foundation for the information society. Having laid that groundwork, though, the dividends realised have been spectacular - because of its investment in higher education, the US can claim the distinction of being the inventor of and, in spite recent setbacks, the unparalleled leader of that.

Undeniably, one way of mitigating higher education costs might be to seek new ways of transforming education into a for-profit endeavor - one would expect such initiatives to be a topic of primary interest to business leaders. But is it possible to extract profit from higher education without simultaneously impoverishing it?

Viewing higher education as a resource from which to extract profit represents the antithesis of the educational philosophy that has elevated the US to its singular position as leader of the information society. It has achieved prominence in the global village by investing in rather than siphoning wealth from higher education.

Therefore it is possible for the country to continue reaping great rewards - but only by enhancing its commitment to access-for-all and by maintaining its philosophy of education as a long-term investment in the future.

* Timothy McGettigan is a Professor of Sociology at Colorado State University - Pueblo.



Great article and a topic that will only expand. My issue is simple: public tuition costs represent only a fraction of the cost of education. It seems to me that, in general, we have let college spending get out of control with little oversight and limited focus on the students.

Edward P Meehan