Changing Higher Education

What will The College of 2020 look like?

Prediction is very difficult, especially about the future

Niels Bohr

(Note: the following was first published as an invited contribution on The College of 2020 in parts 1 and 2. I reproduce it here for the benefit of my readers by permission of the editors of the College of 2020)

What will the College of 2020 look like? It probably will be similar in at least one way to the College of 2011 -there isn't any one archetypical College of 2011 and there won't be any one archetypical College of 2020 either. US higher education consists of about 4,500 accredited colleges of 2011 with an incredible diversity of sizes, approaches, missions, and resources. I would expect the same to be generally true in 2020, with some important caveats: I think there will be significantly fewer accredited colleges in 2020, and the mix of sizes, approaches, missions, and resources will be quite different from today.

These changes will be driven by two forces that push from different directions, but each leading to increasing fiscal constraints on higher education. On the one side, local and national governments are finding it increasingly difficult to support higher education at traditional levels. There a world-wide movement towards decreasing the role of government in providing social goods, and the US reflects that movement. In addition, other governmental costs such as health care, prisons, and retirements are growing rapidly and squeezing out areas such as education. On the other side, all of higher education utilizes a model whose costs over the last 30 years have steadily grown about 3% a year above CPI increase. In the tuition-dependent private sector, tuition has grown apace, i.e. roughly CPI plus 3% every year for the past three decades. The costs of higher education are reaching a point where government, parents, and students are beginning to question if the product is worth the price. The answer is increasingly "no" for private institutions that have lower brand value, but the "no" likely will move upstream in the value ladder over time as costs increase until only a relatively small number of high brand value private institutions are immune. On the public side, the answer is increasingly, "no, not given our fiscal constraints" no matter what the brand value of the institution.

Thus what we will likely see over the next decade in higher education is an attempt to create models that provide high educational value (often, perhaps, higher than at present) with less cost per student. So to imagine what the future might look like, we need to understand why costs are so high and increase so rapidly, and how that can be changed. Oversimplified, a few reasons for the high costs are:

• In this world in which institutional aspirations are increasingly homogenized around a model set by the richest institutions, there is a continuing "arms race" to upgrade and increase teaching, recreational, living and dining facilities; expand student activities and student services; and broaden curricular options – all very costly "improvements"
• Physical plants are generally are very expensive for the number of students served
• Increased bureaucracy is needed to manage the growing fruits of the arms race and ever increasing government regulations.
• Arms race expansions of the breadth of course offerings lead to lowering the average number of students/class, thereby decreasing teaching productivity (students educated divided by teaching costs).
• Colleges increasingly are being asked to remedy the educational failings of secondary education, and this diversion to a non-core mission adds a costly overlay
• Teaching approaches have varied little over the centuries and consequently there currently is little room for increased productivity in this core function.
• Costs tend to increase faster than CPI in any sector where costs are driven by personnel costs, the personnel are highly skilled, and no productivity increases occur.

Another significant driver of educational cost increases has been attempts by many institutions to move up the brand-value chain by increasing emphasis on faculty research. This results in significant cost shifting from faculty research into undergraduate education e.g.:

 

• Research faculty command higher salaries than teaching faculty and those higher costs are spread over fewer students because of reduced teaching loads. Thus teaching productivity gets a double blow.
• Research facilities and instrumentation are more expensive than teaching facilities, and research sponsors and donors seldom if ever pay the complete costs of building and maintaining those facilities and purchasing this instrumentation, leaving costs to be covered by unrestricted funds – which are generally primarily tuition income.
• Government regulations and the bureaucracies needed to respond to them go up exponentially as research comes in, and research funding almost never covers these costs completely, again adding pressure on unrestricted funding.

Different institutions will begin to respond to the financial constraints in different ways depending on their particular conditions and missions. One of the most widespread responses, however, is likely to be a stepping back from the increasingly homogenized view of what "quality" means in higher education. Perversely, "quality" is not currently defined by learning outcomes for students, but by costly surrogates such as quality of student services and amenities, quality of physical plant, quality of faculty research – in short, the elements of the arms race which is defined by reference to the richest educational institutions. Lowering overall costs will require in most cases that institutions define their own unique educational niche – stepping back from the rich-institution inspired arms race. This entails sharpening and redefining institutional missions in order to create niches that are both valuable for students and society, and fiscally sustainable. Different institutions will deemphasize components of the present arms race in different ways, and will create some new, less expensive value propositions in their stead. For example, one component of the response of many may be to narrow their curricular focus to a relatively few popular majors, or to focus on pre-professional training. Happily, many will probably decide that a key component of their new value proposition will be an increased focus on learning appropriate to their new sharpened mission, and on demonstrating that effectiveness. Thus the colleges of 2020 may well show a much wider aspirational profile than what we see today, and one which is more focused on demonstrated learning rather than surrogates.

Another response that likely will be widespread is to increase utilization of physical plant. This can be done by admitting more students, possibly moving to year-around operations. Of course, this only is beneficial if savings on plant are not spent on increased instructional costs. For many institutions, this will mean that faculty will be expected to teach more courses and forego summers away from campus- and many students will have the opportunity (and obligation) to break out of the traditional fall-spring academic year. Online learning will also likely play a major role in enabling more students to be taught without increasing plant or instructional costs proportionally.

In fact, one response that will be almost universal is greatly increased use of technology to improve both productivity and learning outcomes. In particular, online (and blended) learning likely will be a central component of cost cutting, increased learning, and increased access. For stronger brand institutions, targeted use of online and/or blended learning will lead to increased learning outcomes, greater student satisfaction, and better utilization of faculty. It will also be used extensively for projecting the brand beyond the current geographic boundaries of the institutions. For weaker brand institutions, the same uses will be found, but with much more aggressive implementation required in order to achieve fiscal sustainability. For example, groups of weaker brand institutions might jointly share an online curriculum, and differentiate themselves through individual tutoring support and student-life amenities.

Online learning of all types and levels of quality will become readily available as colleges and corporations rush into one of the few areas that holds promise to increase productivity in higher education. A number of these programs will involve visible, major scholars working with the best experts in pedagogy, and have demonstrated high learning outcomes. The widespread availability of such programs will provide a major challenge for institutions that provide a "generic" education that can be easily and cheaply replaced by a high quality online program. (In fact, many of these low brand- differentiation institutions already have significant financial problems because they have few competitive advantages.) These low-brand- differentiation institutions will need to change mission and approach in order to create a differentiated niche that provides value and competitive advantage. Many will not be able to respond creatively in a timely fashion, and will not survive.

Lower ranked research universities will find it increasingly difficult to afford their current profiles - research universities are by far the most expensive form of higher education yet invented. In addition, overall research funding is likely to fall significantly over the next decade, thus making many lower ranked programs even less viable. Options will range from completely leaving research and totally changing faculty profile, to intermediate scenarios that involve a larger teaching faculty and significantly smaller research faculty. Overall, the value proposition for this group of institutions likely will shift in the direction of high quality student learning.

All of this is on the cost side- but some additional changes will work on the side of the price students pay to get a degree. Numerous institutions probably will emulate the Western Governors University and move to competency –based evaluations that enable students to move through the system at their own pace. Such approaches allow students to acquire knowledge from many sources, including work or online programs of their choosing, and get credit from the "home" institution by demonstrating competency. Bologna-like approaches will also provide educational outcomes measures that will greatly facilitate transferring of credit from one institution to another, thus providing a diversity of different cost pathways to a degree. As a consequence, many four year institutions may find that their first two years have been "hollowed out" by less expensive two year organizations specializing in quality transferrable core courses. This loss of enrollment in the more profitable core courses will put additional pressure on the budgets of the four year institutions, thus forcing additional mission change.

So for 2020 – increased diversity of institutional missions, greater use of online and blended learning, 12 month academic calendar, fewer research universities, increased transfer opportunities, not all existing institutions will still be around, and student learning will be a key differentiating factor. Now what was it that Bohr said about predictions?

Data mining higher education records in search of improved outcomes

The Bill and Melinda Gates Foundation has just funded a potentially very interesting and useful study at WCET. Unfortunately, I have to go through a few explanatory layers of acronyms in order to explain that sentence, but stick with me. WCET stands for the WICHE Cooperative for Educational Technologies, while WICHE stands for The Western Interstate Commission for Higher Education. WICHE was created to facilitate sharing of resources among the higher education systems of the West, and has 15 member states.  

The grant focuses on identifying variables that impact student retention and progression.  The study itself will involve data mining of student records from an interesting mixture of instituions: American Public University System, Colorado Community College System, Rio Salado College, University of Hawaii System, University of Illinois Springfield, and University of Phoenix.  The aggregate data to be analyzed contains records of over 400.000 students:

Each of these postsecondary entities has performed extensive research on their own datasets.  The combination of large data sets across a wide variety of types of institutions (public/private, two-year/four-year, traditional/non-traditional) will seek to find patterns identifiable only through analyzing large data sets representing a widely diverse set of students.

The collection and mining of data relating to learning with the goal of understanding and improving outcomes is sometimes called Learning Analytics. Ellen Wagner, WCET Executive Director, discusses the aims of the grant and the general approach of Learning Analytics in a recent blog. As she indicates, there is now a huge amount of data in the online learning realm that almost certainly contains many important insights into the interactions of students with various aspects of that approach. Uncovering these insights should enable improvements in online learning that will lead to significantly improved learning, retention, and graduation outcomes.  

Through large n studies such as these, we can greatly improve our chances to uncover some of those critical insights. WCET and the institutions that have agreed to participate should be congratulated. Hopefully, this study will serve as a stimulus for other large n, multiple institution studies. 

 

The canary in the higher education coal mine

Over the past few months, we have seen an increasing flood of articles by supporters of public higher education around the nation sounding alarms about the potential negative consequences of planned cuts in higher education funding.  Heads of public systems provide detailed analyses of the economic importance of their institutions, and of their role in creating social opportunity and mobility.

What seems to be lost in this discussion is that almost everyone in positions of legislative or executive authority appreciates these arguments and believes they are correct.  The choir is being preached to. The problem, simply stated, is that there are no additional funds that can be allocated to higher education in these times of enormously constrained state budgets.   Even when the economy recovers, as it eventually will, history suggests that funding for higher education will not return to previous levels.  Higher education is simply one of a large number of areas of state funding whose growth exceeds state revenue growth.

The reality is that American higher education generally  costs more than society can sustain into the future.  This is true in both the public and private sectors, which have research and education functions that are organized very similarly even though the funding sources may differ. The “canaries in the educational coal mine” , the early warning system, are, in fact, the tuitions of the private sector of higher education.  Those tuitions have grown for over 30 years at a rate that significantly exceeded the growth in either CPI or family income.  It should have been obvious to all that a system that demanded such growth in order to operate would, in the end, crash into a cost barrier.  Although the immediate crisis is in the public sector, the problem is serious in both sectors.

What are needed at this point are not more calls for a larger piece of the public pie for higher education.  The present economic situation makes it highly unlikely that those calls will be answered in a meaningful way.  What is really needed is a hard look at our present model of higher education.  Accepted beliefs underlying the model need to be challenged and rethought. Mission and the societal role of higher education should be reevaluated for the 21^st century.  Faculty roles, organization of research and its relationship to learning throughout the postsecondary experience need to be reexamined.  Administration, which captures an increasing fraction of higher education’s budgets, deserves equal scrutiny.

It is time to recognize that a redefinition of the model of American higher education is necessary.  It is foolish to argue that we already have the best of all possible models – any model can be improved. Nor should we be fooled by the esteem which our model attracts around the world – indeed, it was the dominant model of the last half of the 20^th century, but the 21^st century looks different in any number of ways.  Real educational and research leadership in the 21^st century will require a model that responds directly to the changing realities of the times

Further developments in the Columbia University Global Impact project.

A year ago, I wrote briefly about Columbia University’s announcement of the opening of a number of global research centers (Columbia goes global following a different track, Mar 20, 2009).  These centers were to be multi-use: facilitating international research collaborations, academic programming, study abroad, etc. As stated in the original announcement:

The goal is to establish a network of regional centers in international capitals to collaboratively address complex global challenges by bringing together scholars, students, public officials, private enterprise, and innovators from a broad range of fields.

This was, and is, a very unusual, and very strategic approach to globalization, seemingly going far beyond the efforts of other universities.  It states that the core missions of the research university of teaching and research should be tied together synergistically as globalization occurs.  It also states that these centers should be used to pull global expertise into the Columbia network of research and teaching, thus leveraging Columbia’s already very significant strengths.  And, of course, the emphasis on complex global challenges is what is most likely to bring those global experts to the centers, thus increasing Columbia’s visibility and prestige.    

Now, a year and 2 days later, Columbia announced the opening of two additional centers, one in Mumbai, India, the other in Paris, France.  These join the original two centers, located in Beijing and Amman.  The role of the centers was further articulated in this most recent announcement as:

Columbia Global Centers are established to encourage new collaboration across traditional academic disciplines at the University. Some of the research and scholarly initiatives will be regionally focused; others will involve multiple centers, and in some instances the full complement of centers will be engaged across many continents. The centers are also intended to support a significant expansion of opportunities for Columbia students and faculty to do work abroad, with the flexibility to pursue long- or short-term research and service-learning projects.

In my original post, I called this A fascinating - and overdue - experiment! It is good to see that the experiment is continuing, and remains fascinating. 

Creativity and the Research University:II

This is a continuation of Creativity and the Research University
II. The creative faculty

The issues are different here from those encountered in looking at student creativity, because we are dealing with a class of accomplished scholars who have already shown capacity for creativity.  Thus the environment in which the faculty work becomes a critical determinant of whether or not they can reach their creative potential.

Amabile describes some of the environmental conditions that help to promote creativity.  Among them are:

• stability of employment - this lowers attention to problems not related to the main tasks of research and teaching
• low bureaucracy - similarly, this enables faculty to keep their attention on the important things
• encourage rational intellectual risk taking, accept failure
• encourage interdisciplinary conversations - this help connections into different networks of knowledge
• expectations high but reasonable
• rewards not controlling - faculty choice in tasks, methods

In many ways, we see that the university is set up relatively well to meet most of these conditions. Tenure, for example, provides the desired stability of employment - for those who have it. Faculty are given broad choice by the university in how they will carry out their tasks.  However, even here there are reality constraints that can lessen creativity. For example, funding for the research component of the employment is increasingly difficult to obtain, and faculty generally find themselves devoting larger fractions of their effort to finding needed research funds. The funding, when found, often is narrowly defined and can squeeze out any significant creative flights of fancy. Worst of all, many universities push their faculty to have the largest possible grants at all times - it helps the rankings. Such controlling pressure probably does not lead to the highest creativity.  As Amabile has pointed out, the external funding can be most useful if it comes after the “aha” moment of creativity, since at that point it is not controlling, but facilitating.  Thus some relatively small internal funds to support research through the necessary first idea steps ultimately could lead to increased creativity of proposals.

In addition, other improvements need to be made in the existing university structure.  Bureaucracy, unfortunately, has grown significantly in universities over the years due to both internal and external pressures. Universities tend to have very intrenched administrative systems and groups, and in many institutions strong leadership will be required to create the kinds of administrative restructuring needed to create organizations that more closely meet tomorrow’s needs. For example, on many campuses I hear very vocal complaints about inefficiencies in the research offices, which seem not well organized to meet new requirements of the Federal Government, alert faculty to new research opportunities, provide timely grant financial data, etc.  Internally, the important principle of shared governance has often led to a profusion of sometimes overlapping faculty committees that both demand considerable time on the part of the participants, and lead to frustration on the part of other faculty who feel that their ideas and innovations are being subjected to unfair or confused scrutiny. 

Finally, many of our leaders do not do as good a job as they should of creating a supportive atmosphere of high expectations in their institutions.  Distinguished senior faculty are the most important players in creating this atmosphere of supportive expectations.  For example, I.I Rabi was a Nobel-prizewinning physicist at Columbia, one of the founders of modern quantum mechanics.  He was legendary in his ability to stimulate his colleagues to “try harder”. One of his colleagues was quoted in Rabi’s obituary as saying “The most spectacular thing about Rabi was that during a 15 year period there were four Nobel Prizes all in different fields of physics at Columbia.  Although Rabi wasn’t involved in the specific work, he was the key motivating person.” According to a widely quoted (and perhaps apocryphal) story, Rabi would roam the halls of the department, dropping into offices to ask about the latest research of individual faculty. When it had been explained to him, he would ask, “ Is this the most important problem in your field? If not, why aren’t you working on the most important problem?” With more senior faculty helping to define expectations like that, we would have a much more creative atmosphere!

One of the areas where universities generally are not really good is in encouraging interdisciplinary conversations.  Many claim to do it well, but when you look at it closely, few are actually good at it.  It is interesting to look at the brand new King Abdulla University of Science and Technology (see my comments here and here), which is organized with the goal of actually being at the forefront of  interdisciplinary knowledge creation: 

KAUST is a modern research university unlike any other.  The University is designed to allow physical and human networks – operating largely without regard for organizational or national boundaries – to flourish, thereby creating a critical vehicle for the exchange of ideas and the development of new knowledge.

The KAUST approach is obviously not the only one for increasing interdisciplinary activities and conversations.  However, it does give some feeling for the elements to be considered, and the significant organizational changes that might be required to maximize interdisciplinary exchange of ideas.

Are we approaching a tipping point in the globalization of higher education?

The unsettling financial events of the past few weeks have undoubtedly pushed the cost/price model of American higher education much closer to the breaking point.  In an earlier post, I argued that any significant limitations on price increases could cause fundamental problems for our basic business model.  We now are in a much more complex situation than I discussed in the earlier posts. The state of the economy certainly will lead to greater pressure from parents and government to halt increases in the real price of higher education, so we can expect more intrusive legislative actions, and much stronger push-back from parents.  Loans to parents and students, which have provided the undergirding support of our large price increases, will not be so easy to get in the future for a multitude of reasons including large drops in home values.   In addition, we face a situation in which philanthropy will be quite uncertain for some period, and endowments and their returns have been greatly battered.   For public institutions, there is the reality that states are seeing greatly reduced tax returns, and furious budget cutting is evident everywhere.   And on the cost side, the cost of borrowing (when it can be obtained) will certainly go up significantly. This will impact higher education directly in many ways, as in  our facilities programs where we usually use considerable long term debt.  In addition, many  higher education institutions have significant short term debt that is used to pay bills in between the huge inflows of income that occur at the beginning of each semester (trimester or quarter).

In my view, all of this pushes American higher education much closer to a globalization tipping-point, similar to the one  that occurred in Great Britain and Australia a decade ago.  In both cases, governments told public higher ed institutions that state funding would not be sufficient in the future to maintain their growth and quality, and that other sources of funding would have to be found - without passing the burden to domestic students.  The solution was to bring international students in at high tuition, and to open campuses and programs around the world.

Update on KAUST

The King Abdulla University of Science and Technology (KAUST) is moving along on its development plans (see King Abdulla University of Science and Technology - a paradigm for the 21st century? June 5, 2007).  In January, KAUST got off to an excellent start with the appointment of Shih Choon Fong as its first President.  Dr Shih is currently the very highly regarded President of the National University of Singapore, and will assume the presidency of KAUST next December.

KAUST is not waiting for its president to arrive, however, before implementing its plans to build by creating partnerships with the leading educational institutions in the world.  Although some of the agreements took some time to actually finalize, previously announced partnerships and dates are:
Woods Hole Oceanographic Institutite (June 15, 2007)
Institute Francais de Petrole ( June 22, 2007)
National University of Singapore (June 27, 2007)
IIT Bombay (July 16, 2007)
American University in Cairo (September 5, 2007)
Technische Universitat Munchen (January 24, 2008).
Each of these agreements describes partnerships in specific areas of research and education, with financial arrangements that vary to meet the circumstances.

In the last two days, three very significant new partnership arrangement with American universities have been announced.  On March 4, agreements with the University of California at Berkeley (UCB) and Stanford University were announced, and on March 5, an agreement with the University of Texas at Austin was announced.  It is reported that Stanford and UCB will each receive almost $30M over 5 years as part of this partnership.  Of that, $10 will be for participating departments, $10M will be for joint research at the institutions involving new KAUST faculty, $5M will be for joint research at KAUST, and $3M-$4M will be for administrative costs.  Stanford and UCB will each have responsibilities in identifying and helping to recruit faculty for KAUST, and in hosting KAUST faculty until the KAUST campus opens.  The conditions at UT are more or less the same.

All in all, a very impressive list of partner institutions.  The quality and the international visibility of each of them helps to assure that KAUST will indeed begin to develop following international norms for access and freedom of inquiry.

The breakdown of the price-productivity-cost model of private research universities

I have learned a lot recently  participating in a project on Global Higher Education led by Paul Jansen and Debby Bielak of McKinsey &Co.  The project is sponsored by the Forum for the Future of Higher Education. Paul and Debby have collected a group of university CFO’s, a college president, and an old provost (me) together to apply a McKinsey sector-wide analysis to higher education. It is fascinating to see what such an analysis tells us about our world.

The team recently made a presentation entitled Higher Education Trends and Risks: Implications for Leading Institutions and Sector Performance  at the annual Aspen Symposium of the Forum.  My assignment was to talk about trends and risks for private research universities - in 15 minutes.  I approached this impossible task by first apologizing to the audience for the egregious simplifications that I would have to make in order to describe the situation in 15 minutes, and then introduced my simple one-parameter model to describe the problems facing the research university.  Since this model met with some approval at the Symposium, I thought it might be worth repeating here.

I began by describing what I called our Mission Box. Excellence - as defined by us in a very self-referential way - has become the visible driver of our mission.  Our mission, in a very general way, focuses on traditional undergraduate education, graduate and professional education, and research.  Focusing on excellence means that if it is worth doing (i.e. one of our mission foci), it is worth doing better.  Doing it better costs more money, so at some point the customer can’t, or won’t pay for it, so we lose money.  As a consequence, over time, losing money has become our very visible surrogate for excellence (my one parameter model). (Clayton Christensen, who also spoke at the symposium, has pointed out the often catastrophic outcomes of making your product better than the customer wants or needs. See also Disruptive Technologies:when great universities fail? March 3, 2006)

Changing US output in science and technology

The NSF just released two interesting reports. Changing US Output of Scientific Articles:1988-2003 is a detailed analysis of publications in refereed journals over that time period.  The companion publication, Changing Research and Publication Environment in American Research Universities, is based on interviews with scientists in 9 leading US research universities.

The first report extends and quantifies the well known result that the American share of international research publications has been dropping over time as other countries build their scientific and engineering capabilities.  More importantly, it also shows the very surprising result that the absolute number of US scientific publications in peer reviewed journals has plateaued or dropped since the early 1990s. The second report seeks to understand that flattening  of US research output.

Outsourcing research

InnoCentive has an intriguing business model.  As described on their website:
"InnoCentive® is an exciting web-based community matching top scientists to relevant R&D challenges facing leading companies from around the globe. We provide a powerful online forum enabling major companies to reward scientific innovation through financial incentives."
If your company cannot solve an important technical problem, you register as a seeker; if you are a scientist, engineer, etc  with a bit of free time and an itch to solve some interesting problems, you register as a solver. InnoCentive gets the seekers and solvers together, with financial prizes from the seekers to the solver or solvers who produce the useful solutions.  The Rockefeller Foundation has recently partnered with InnoCentive to apply the same platform to global development problems.  In this case, the seekers will be non-profit entities chosen by the Foundation that serve poor or vulnerable peoples.

One might be tempted to think that this “dating service” approach to problem solving could be useful only to small start-ups that cannot afford their own research.  Turns out, if you think that, you are really wrong.  A recent Harvard Business School working paper by K.R. Lakhani, L.B.Jeppesen, P.A.Lohse and J.A.Panetta has analyzed InnoCentive results for 166 scientific problems that the research laboratories of “large and well-known R&D-intensive firms had been unsuccessful in solving internally.” Several of the problems reflected several years of unsuccessful effort in the company’s research labs.  The results are fascinating.