Co-authored by Cathy Ford
The campus is changing. Funding and revenue streams are subject to new pressures. Student and faculty expectations are only increasing. Technologies are hurtling forward. The jobs market is shifting.
As we speak, higher education is facing one of the greatest transformations in its long history.
Meet Queensland University of Technology
At Queensland University of Technology (QUT), we aim to lead the adoption and delivery of digitally enhanced, high quality education and research. Our goal: be the university for the real world.
“From the learner perspective, not only do students want to learn, but they want to be part of a community. They want to build connections. They want to be work-ready. They need the flexibility to work online, and on-campus, and blended.”Cathy Ford, CIO of Queensland University of Technology
We aim to provide this real-world, digitally driven experience through four key measures:
- Provide digitally-enhanced teaching and learning: this includes micro-courses, digital credentials, personalized learning, and lifelong learning opportunities.
- Drive research excellence through partnerships and technology innovation.
- Leverage digital technologies for operational excellence, including automation and improvement of existing processes
- Enhance agility through the use of business-ready, scalable, and secure digital platforms and services
Core to making this strategy a reality is revenue resilience.
What does revenue resilience mean in education?
Disruption occurs when revenue falls below cost (see Figure). Today, in higher education, many institutions are seeing decreasing revenue for a number of reasons. Like in most sectors, tech giants are entering the market with alternative offerings (e.g. Google’s certificate programs). The digital economy has also started to impact the pricing model as mature, continuous offerings are now available for free. As a result, learning may be more popular than ever, but the value of degrees is declining. These effects have been further amplified by the COVID-19 pandemic and its restrictions on the global movements of international students.
Revenue resilience means to defend such threats to the revenue base and to create new, sustainable revenue streams where needed. It begs several questions:
- What are the main threats to our revenue base – new products, new competition, regulatory changes, demand changes?
- What revenue opportunities do exist in the current landscape? For example, how can we as a university capitalize on the idle assets (e.g., infrastructure), create a globally attractive offering or benefit from the increased digital literacy of our society?
- How do we build resilience into our future revenue streams?
Today’s opportunity-rich environment provides a plethora of innovative pathways to growth, but the danger is that the higher education sector remains focused on internal issues only. Revenue resilient organisations, however, are driven by their sense of ambition as opposed to responding to a sense of urgency alone.
Translating continuous improvement to education
“Current education providers, as well as new entrants, have the chance to replicate the business models and innovative practices of Spotify, YouTube, Uber, Airbnb and disruptors of other sectors.”Martin Betts and Michael Rosemann, The Conversation
We assume that the future of education will be rooted in a more continuous model of engagement as fast-paced developments have accelerated the depreciation of knowledge. Historically, higher education has been sold on a degree-based model. This no longer seems to be an adequate model. Education can no longer be a system where a student is educated, learns a set of tools and skills, and then uses those for the rest of his or her life.
How can we accomplish this massive shift?
The first step is to continuously engage students over the course of their careers. From when they step foot of campus – digital or physical – universities can provide continuous updates to the education they received. Thus, graduation would be the beginning, and not the end, of the university-student relationship.
This replicates the business model of the software industry, where software sold is continuously maintained via upgrade services. For universities, this could mean you think of as providing an MBA 2.0 – then, a 2.1, and so on. Instead of “just in case” lessons, these updates will provide “just in time” learnings to ensure the individual continues to have a high level of ‘educational wellbeing.’ Offered as a subscription model, one could imagine that besides the individual learner, entire organisations offer such a service for its staff to ensure they have the qualifications needed to strive in the digital economy.
Not only does this transition support lifelong education for the student, it also increases “customer retention” and creates entirely new revenue streams. Such a willingness to adapt new business models in the higher education sector, will be a pre-requisite for the revenue resilient university.
Lifelong credentialing over micro-credentialing
Students need current credentials. Just as software is continuously evolving, tomorrow’s degree programs will be characterized by updates and upgrades to previous lessons. Instead of reinvention – for example, going for an MBA after years in engineering – education will be about evolution.
It is no easy task to reinvent education. However, by leveraging the tools and best practices developed and matured across diverse industries, we can reimagine a more resilient future – for both the university and the student.
How are you reimagining education? What does revenue resilience mean at your university? Join the conversation in the comments and stay tuned for more thought leadership perspectives from the Global Leaders Forum next week.