THIS AGE OF disruption presents higher education leaders with two pressing questions. First, how do we effect rapid change in a near monolithic industry that has been deliberately designed for staying power rather than for agility? And, more important, how do we support our stakeholders as they adjust to rapid internal and external change?
For more than half a century, U.S. institutions of higher education have harnessed a successful business model that has positioned them as global leaders. This model has led to best-in-class program quality, increasing domestic and international demand, and dramatic expansion of academic, residential, and student services facilities. Two pieces of legislation spurred our industry even further—the 1944 G.I. Bill, which funded education for World War II veterans, and the 1958 National Defense Education Act, which pumped 1 billion USD into higher education over four years.
These two investments have fueled nearly three decades of growth in postsecondary enrollments in the United States. In 1959, college enrollments among traditional-aged students stood at 3.6 million; by 1991, 14.1 million students were attending college.
CLOUDS ON THE HORIZON
Over the last two decades, a different story has emerged. State and federal funding has declined by 7 billion USD over the past 10 years. The accumulation of student debt has raised concerns about the financial health of a generation. And while enrollments have continued to grow since 1990, the rate of degree attainment in the United States by those age 25 to 34 has fallen from second in the world to 13th among developed nations.
Meanwhile, long-accepted admissions practices related to issues such as early-decision admission and transfers, which came under recent scrutiny by the U.S. Justice Department, along with threats to affirmative action policies intended to mitigate racial discrimination, have exacerbated concerns about access and equity. All this is happening at a time when organizations need more credentialed employees with the skills to work in a competitive global economy.
The ensuing erosion of societal confidence in higher ed has been magnified by the pandemic, which continues to upend our industry. The impact of COVID-19 has led to enrollment declines, forcing many colleges and universities to lay off staff and shutter physical facilities. Some even face the very real possibility of having to close their doors for more than just a few months. In short order, the coronavirus has forced higher education to confront rapid systemic change.
Last spring, institutions took steps to ensure the safety of students, faculty, and staff by suspending on-site teaching and making the hurried transition to remote course delivery. Without time to intentionally build high-quality online offerings, most institutions simply dropped their traditional face-to-face courses onto synchronous online broadcast platforms.
While faculty gamely put in the time to make the move to remote instruction work, they were largely underprepared and undersupported. A July survey of faculty found that fewer than half who responded agreed that remote instruction is as effective as face-to-face teaching. It’s no wonder that students reacted with petitions, and even lawsuits, demanding tuition discounts on the grounds that online learning failed to meet the standards of in-person instruction.
These outcomes are signs that our sector is so invested in its existing way of doing business that it is unable, or unwilling, to respond nimbly to new challenges.
THE CASE FOR DISRUPTION AND AGILITY
When I became dean at the Gies College of Business at the University of Illinois at Urbana-Champaign in 2015, the marketplace was clearly shifting in ways that kicked our sense of urgency into high gear. Competition for top students and faculty was fierce. Companies and students alike were questioning the value of an MBA. And corporations wanted graduates with skills such as data analytics, innovation, and design thinking that most business schools had not yet fully integrated into their curricula.
In 2016, we responded to these shifts by disrupting our graduate business education model—we launched a completely new MBA program. Built on a stackable model, our online iMBA program is delivered over Coursera’s MOOC platform and relies on economies of scale to drive down tuition.
OUR SECTOR IS SO INVESTED IN ITS EXISTING WAY OF DOING BUSINESS THAT IT IS UNABLE, OR UNWILLING, TO RESPOND NIMBLY TO NEW CHALLENGES.
To pull off this transformation, we invested in production studios, as well as a team of more than 70 experts in instructional design, technology, and videography. We convinced our faculty to rethink every aspect of their teaching. These investments were rewarded with exponential enrollment growth—from 114 students in 2016 to more than 3,800 students this fall—and a 98 percent student satisfaction rate. They also paid off in an unexpected way—creating our iMBA prepared us for a world where COVID-19 would force us to move even our residential programs fully online.
CULTURAL CHANGE AND THE HUMAN FACTOR
Institutions reap the rewards of change only when all stakeholders—be they faculty, staff, or students—embrace the change. To ensure that our people share a commitment to agility, we have established three precepts:
- We focus discussions on the marketplace. We let the needs of our stakeholders—alumni, prospective and current students, and the business community—guide our direction, not the teaching preferences of our faculty.
- We communicate constantly and carefully. Our goal is to build understanding and trust, not necessarily to build unanimous support.
- We listen to new ideas with the presumption of “yes.” In other words, while we are clear about our vision, aspirations, and values, we leave room for innovative ideas to surface from faculty, staff, students, and alumni as we decide how to achieve our goals.
We want everyone in the Gies community to know that our culture is one that is receptive to change and embraces reasoned risk.
HAZARDS AND TENSIONS
As is true with every significant disruption, not every attempt to innovate will fit the institution exactly the way you think it will—or should. And, of course, not everyone welcomes change. But if you try to keep everyone happy, you are not going to be an innovator.
As we manage disruption, we must negotiate many dualities, or tensions, between different forces. I cannot say we have overcome them all at Gies, but we recognize they exist, talk about them openly, and work continuously to resolve them. These tensions include:
Speed versus governance. To develop our iMBA as we maintained our existing programs, we initially established a small working group of faculty and staff. We shielded these individuals from their normal day-to-day responsibilities and empowered them to be bold as they broke new ground where there was no clear playbook.
WE LISTEN TO NEW IDEAS WITH THE PRESUMPTION OF “YES,” LEAVING ROOM FOR INNOVATIVE IDEAS TO SURFACE FROM FACULTY, STAFF, STUDENTS, AND ALUMNI.
At the same time, we worked within the bounds of shared governance. The novelty and speed at which we were moving created tension—when the proposal to create the iMBA was brought to the relevant university senate committee, it passed by a single vote.
People sometimes talk about whether it is better to ask for permission or forgiveness. In academic environments, relying on one or the other when adopting change doesn’t work. In a system that isn’t built for quick transformation, you must balance speed with deliberation.
Organizational transparency versus confidentiality. Transparency is key to building trust. That is why, when deciding whether to suspend enrollment in an existing degree program, I sit down one-on-one with every faculty member teaching in that program to explain our reasoning and hear their concerns. This helps build credibility, even when they disagree with the decision.
But this desire for transparency must be carefully balanced against the consequences of the information leaking too early. For example, if word gets out to prospective students that you are considering shuttering a degree program, the market response may seal the program’s demise before your decision is made. Transparency is always a good idea, but you must consider the timing of that transparency carefully.
Organizational stress versus resilience. It is easy to identify the individuals most affected by a single change. But even people who might have been untouched by any one change might be affected when you’re making many changes simultaneously. You must be alert to this possibility—across the entire organization and at every level. You should be ready to invest resources to alleviate organizational stresses that the changes create.
LEADERS WHO CREATE ENVIRONMENTS WHERE DISRUPTIVE THINKING IS ENCOURAGED WILL FIND NEW WAYS TO DELIVER ON THE CORE MISSIONS OF THEIR INSTITUTIONS.
Organizational structure versus flexibility. At universities, our ability to quickly deploy talent to manage new ventures is limited by tenure, unions, administrative position policies, and civil service requirements. Further, if we want to implement our ideas successfully, we need to ensure the right team is working on the right tasks at the right time. That’s why it’s not enough that we hire people with a penchant for innovation and a tolerance for change. We also must write flexible job descriptions that provide them with more opportunities for individual and organizational growth.
ENTERING AN EXCITING ERA
Managing these tensions effectively is essential if we want to grow our programs in this new era. But while this time might be unsettling, as proven approaches of the past are displaced by new innovations, it’s also incredibly exciting. This is a time when energy, creativity, and experimentation can thrive. Leaders who intentionally create environments where disruptive thinking is encouraged will find new, more effective ways to deliver on the core missions of their institutions.
We know that the way business schools pursue their educational missions is changing. In that case, we owe it to our many stakeholders to lead our organizations into an era of unprecedented agility and innovation.
Jeffrey Brown is dean of the Gies College of Business at the University of Illinois at Urbana-Champaign.