The model that dominates non-profit higher education today is under severe stress, particularly at the less-selective institutions that serve the bulk of American students.
Four forces – behavioral, demographic, financial, and political -- have combined to disrupt these institutions’ business practices.
First, the student swirl. As fewer students earn their credits at a single institution, and take courses from multiple providers -- from early college high schools, at community colleges, and from various online purveyors – the system of cross-subsidies that institutions relied upon to pay for small upper-division classes erodes. Every indicator suggests that the swirl, and the financial problems it creates, will intensify in the years ahead.
Next are the challenges posed by shifting student demographics.
A more diverse student body, with more low-income students, more English language learners, and more non-traditional students with a broader range of academic preparation places increasing demands on universities’ financial aid budgets and support services. Driving the growth in university administration are not only regulatory requirements, but the need to provide enhanced assistance to today’s highly diverse student body.
Then, there are the mounting financial pressures as state funding per FTE student declines. Given competing demands on state budgets – involving Medicaid, mental health, K-12 education, transportation, and criminal justice – it is unrealistic to expect significant increases in state spending on higher education.
The most troubling challenge involves flagging political support for higher education, which grows out of the widespread belief that universities do not provide a good value for the money, that graduation rates are too low, and that graduates lack the skills that businesses expect. Universities, in short, face the task of providing a quality education with better learning outcomes and higher levels of student success much more efficiently.
Flagship campuses are best prepared to respond to these disruptions. By increasing funded research and donations from foundations and private individuals, expanding revenue from auxiliary enterprises and Continuing Ed, outsourcing “non-essential” university services, increasing reliance on adjunct faculty, and boosting admissions of international and out-of-state students who do not receive financial aid, Research 1s seek to sustain their current model.
But these strategies work less well for less prestigious institutions. For these universities, a model built around the concept of more – more programs, more buildings, more grants and contracts, and more residential students – has done little to improve affordability, access, and student success. Nor has this approach enhanced institutional sustainability.
Clearly, new models are necessary.
Here are four alternative strategies that institutions are pursuing:
Model 1: The Extension Model
Similar to the twentieth century agricultural extension centers, this “Hub and Spokes” model distributes small academic centers across a dispersed region or metropolitan area. These academic centers serve solely as extension sites, where Continuing Education courses are offered either face-to-face or in a hybrid delivery modality. This model seeks to increase access and enrollment while discouraging competing institutions from intruding on a university’s “turf.”
Model 2: The Distributed University
A growing number of universities are adopting a variant on a model pioneered by community colleges: Setting up a number of satellite campuses under central direction. Some follow a “Shared Services Model,” in which the branches are independent in their academic offerings, while the main campus centrally manages admissions, enrollment management, financial aid, and other support services. Increasingly popular is a “Campus Differentiation” model, in which each branch has its own distinct mission and focuses on a distinct student population, whether residential undergraduates, non-traditional undergraduates, graduate and professional students, or working adults. Then there is the “Centers of Excellence” approach, in which specialized programs are located in areas tailored to that specific area’s economic needs or strengths.
Model 3: The University in the Cloud
This model, still rare at non-profit institutions but common among the for-profits, involves “Distributed Delivery,” in which standardized academic programming is delivered at scale, utilizing fully online and hybrid delivery and videoconferencing or some sort of emporium model. Although many academics criticize this approach as a mass-produced machine learning, a scaled approach offers a number of potential advantages: It permits substantial investment in interactive learning objects and personalized, adaptive learning pathways, while allowing institutions to redeploy faculty in high impact practices: seminars, writing intensive courses, undergraduate research, and capstone experiences.
Model 4: A Student-Centric Model
Rejecting the “one-size-fits-all” conception of education, this model seeks to serve distinct student sub-populations in divergent ways tailored to learners’ needs. An approach that serves traditional undergraduates well often works poorly for degree completers, commuter students, caregivers, or working adults. Some might best be served by a competency-based approach that optimizes time to degree; others by a career-focused curriculum; still others by a low residency model or a coop approach in which paid internships are an integral part of the students’ degree pathway.
Steven Mintz is the Executive Director of the University of Texas System’s Institute for Transformational Learning and a Professor of History at the University of Texas at Austin.
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