09 May University managing Opportunity or Risk?
University managing Opportunity or Risk? Andrew Hargreaves sets out the case for knowing your strategic context.
The outlook is not the same for everyone.
When you work with Higher Education (HE) data as much as we do at dataHE you become very intimate with what it is telling you.
We encounter millions upon millions of data points, each interconnection generating new insights and perspective on any individual university’s story.
If I were to try and synthesise it down to its simplest level then it would be this. Universities broadly fit into two categories from an outlook perspective:
1) Those who are managing opportunity. That is to say, that their circumstances mean that their strategic dilemma should be to focus on which opportunity to take; they often have more than one and the strategic discipline should focus on delivering opportunity effectively; and
2) Those who are managing risk. For these institutions choices are not as plentiful, and often, through no direct fault of their own, they are in a risk mitigation situation. Fair weather winds are not behind these institutions, and managing risk requires a different response.
Now let me be clear. I’m not saying that there are no opportunities for those in my ‘risk’ category. Nor am I suggesting that those with opportunities don’t also need to manage risk. What I am advocating is that if you don’t know your starting point in the context of the sector, or what the future is looking like for you, then how can you focus your leadership effort in the right place? If you don’t fully understand the scale of opportunity or risk then how can you align and galvanise your resources effectively?
It saddens me to report that I often don’t think sector colleagues understand their starting point. At best many have an inkling, but lack the analysis to put their finger on it. I meet many who are in a state of ‘plausible deniability’ because they simply don’t know. And at the worst extreme some know, but appear to be in a state of ‘implausible deniability’ of their reality.
There are three critical data points I would encourage any university to get a handle on:
1) Their demand outlook. Pools of demand are enormously varied for every university in the land. This is often due to their geographical location. Demand for UKHE, both domestically and internationally, is largely driven by population experiences at a local level.
This simple plot shows the scale of that variability. Each position represents a university. The horizontal axis shows the % loss of 18 year olds each will experience between 2015-2020. The vertical shows the scale of growth in demand from the same group each will experience between 2020-2025. Those in the bottom left get little if any net overall gain, whilst those in the top right will benefit from net gains of demand of +20%. Only a handful of universities know precisely where they sit on this plot.
2) Their performance outlook. Within the pools universities perform differently. Some are winners and some are losers within key market segments. Most don’t know which they are. Market share, not student numbers alone, is a much better measure of performance culture and recruitment attractiveness. The size of the market will change, what shouldn’t change, if you are performing in line with the market, is your overall share of it. That is unless of course you have chosen to downsize or to trade size for tariff of intake.
3) Portfolio outlook. Your product or offering to the market is a further huge influence on your performance outlook. Not all courses or programmes are equally attractive within a university, nor are they equally attractive across universities. The tariff and league table position of a university is an important influence over the types of student it attracts, in turn these students are looking for different types of programmes. Adapting your offer to keep pace with the market requires market intelligence and an agile product development culture.
Knowing these starting points, are in my view, some of the most important, and performance differentiating data a university can have. If you know them then you’ll know the scale of opportunity and of risk you are facing. Once you know that, you can develop a better informed, more nuanced strategy and tactical plan for brand, recruitment, portfolio and your future.