What business are we in?

A key question for every corporation over the recent decades of turbulence in the national and international marketplace has been "What business are we in?" As conditions changed, those corporations that really understood their business were best able to emerge in a strengthened situation. Often, companies decided that their existing understanding of their businesses were too restrictive. An oft-cited example of such a case is UPS, which realized its business was not simply delivering packages in its familiar brown trucks, but rather provision of logistics processes to a diverse spectrum of customers.  They are supply chain managers for companies of all sizes worldwide, working intimately with companies to design every aspect of their supply-chain.  In doing so, UPS moved from being a simple shipper of goods on request for corporations, to being a partner with corporations in the production and sales (and repairs) of their products. This partnership enables the corporations to better focus on their core businesses, and has enabled UPS to flourish. (A nice description of the UPS role in the changing world is given by Thomas Friedman in The World is Flat, p 141-150.)

Universities have tended not to ask what business we are in. Or perhaps the answer seemed to be too obvious - " what we are doing now is our business." As we look to the future of universities, however, this obvious answer simply will not enable us to imagine a broad enough spectrum of possible futures. As conditions change, what opportunities should we embrace, which should we ignore? What components of what we do today are to be strengthened, and which might be phased out?

This will be my first take this important question, and is intended to begin exploration of various models rather than provide a proposal for action. The model that I discuss here might be called the “UPS model”, or, more specifically, the Knowledge Chain Manager model.

A partial answer to this complex question about our business is "we are in the knowledge business." Clark Kerr wrote decades ago of universities being part of the knowledge industry, and many have discussed the ever-growing knowledge industry from a variety of perspectives.  Indeed, the role of universities (a term I use as a shorthand for non-profit research universities) involves knowledge in a broad variety of ways. For example, as members of the group of research universities, we are very active in both search and research of knowledge. By research, I mean the creation of new knowledge by our own faculties. By search, I mean learning about and using both existing knowledge and knowledge being created contemporaneously in other research institutions.  The creation of new knowledge in our institutions takes place over a very broad spectrum, including the sciences, humanities, social sciences, arts, medicine, business, etc. Another of our core missions is to teach the knowledge our faculties have learned by both search and research. Teaching typically covers all of the areas in which research is being done, and is carried out at a variety of academic levels. Yet another way in which knowledge comes into our activities is in its use. By publishing their research, our faculties help lay the basis for the creation of the next generation of applied and basic knowledge. In addition, many of our faculty use their knowledge directly to help bring about change, for example by advising policy makers or helping corporations address organizational issues. Although we do not typically produce physical products, the underlying intellectual property (IP) of our research can be sold or licensed so that others can use it to do so. 

Of course, there are other parts of the knowledge industry that have roles that overlap in places with us. Examples would be the Federal Government through its labs and IP transfer, for-profit education through teaching, industry through its labs, corporate universities, and IP transfer. So the business we are in should somehow differentiate us from the other players in the industry if we hope to succeed over the long term

Clearly knowledge, its creation, its teaching, and its use, must have something central to do with the business of the university. But one might argue that we, like the UPS of old, have too narrow a take on what our role could be in our industry. If we are the knowledge experts, how might we most broadly define our business? Imagine that one defined the underlying strength of our business (as now) as the creation and collection of knowledge (research and search). But imagine that the second part of our business, equally important, was to see to it that that knowledge moved rapidly and effectively to end users. That is, instead of simply publishing articles about our knowledge and moving on, we follow up by actively working in partnership with individuals and institutions where additional pertinent knowledge can create value both for them and for us.  For example, these partnerships might be organized along the lines of the process networks of Hagel and Brown (see What has offshoring got to do with research universities? Feb.22, 2006). Then, by working iteratively and closely with our partners we could greatly decrease times required to create certain types of new knowledge, and to move new information or technology into the core competencies of our partners.  In effect, many other institutions could begin to “outsource” some or all of their knowledge functions to universities, working collaboratively in partnerships where information and ideas flow in both directions for maximum capability building for all parties.  Part of the resulting capability building for the university would be access to unparalleled educational opportunities for many of our professional school students, and many of our professional school faculty would find such partnerships to provide gold mines of research.

This definition of our real business would lead us to become the knowledge chain managers, from creation to provision, allowing our partners to focus on their core businesses, while at the same time greatly increasing our capabilities in much of our teaching and research. There are many reasons that this might be difficult to accomplish, or it might simply be a bad idea. Strong organizational structures would have to be invented to ensure that the new knowledge creation in the university is not driven to an unhealthy degree by the needs of the various partners. Even now, there are many valid concerns regarding university-industry ties. Tenure would have to be looked at carefully to determine which positions in this knowledge chain would be eligible.  Conflict of interest would become much more difficult to manage. Many other serious issues can easily be raised. However, major change in our universities is likely to be inevitable in this evolving world, and the presence of issues will not stop the need for institutional change. Issues such as these will need to be addressed by determining what values we really want to preserve, and where we can change without damage to the core of our values.

The National Intelligence Council in "Mapping the Global Futures" predicts that adoption of new technologies by countries will be the key to their gaining maximum benefit from globalization (see The World in 2020, Feb.17,2006). If true, then the institutions that understand how to facilitate that adoption will become increasingly important. Perhaps this is the key new role for research universities.