Proceedings of 4th European Business Research Conference

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Proceedings of 4th European Business Research Conference
9 - 10 April 2015, Imperial College, London, UK, ISBN: 978-1-922069-72-6
Higher Education in the 21st Century: A Conceptual Overview
of Key Trends and Core Challenges
Francesca Pucciarelli*1
The Higher Education sector has been subject to unprecedented
transformation in scope and diversity in the past decade. Education, which
used to be considered as a public good, is now asked to reason as a global
marketplace. To cope with these increasing rivalry and complexity Higher
Education (HE) Institutions need an appropriate comprehension of macro
trends affecting the industry, both in term of opportunities to exploit and
challenges to overcome, therefore is not surprising that the concept of
strategy in HE has been called out regularly as a topic of increasing
attention. Based on a systematic review of prior literature, this conceptual
article integrates itself into this discussion by proposing an updated
taxonomy of nine trends that will impact Higher Education in Europe in the
medium-term. Based on these trends, we identify three core challenges
that HE Institutions will face and that have fundamental implications for
research and practice: the need of balancing prestige and market share
logics, of embracing an entrepreneurial mind-set and of increasing
interaction with key stakeholders in a co-creative way.
1. Introduction
Strategizing is a need for any business to remain competitive, Higher Education included.
Scholars and decisions makers are actively the future of academia, the influence of
environment trends and incoming challenges to anticipate. Some of these perspectives
are very optimistic, whereas others foresee mainly doom scenarios (Duderstandt, 2000),
however a number of conclusions reached in arguing future perspectives are shared by
both positions. In fact, both views strongly state the need of going further in the re-thinking
of Higher Education, as “academia’s future will be existing, complicated, uncertain and
challenging” (de Boer et al., 2002). Another common verification affirms that Higher
Education institutions need a strategy to compete (EC, 2013): to assess the drivers of the
change, to devise adequate reactions, and thus, to deploy a plan able to make evolution
(or even revolution) happens (Altbach et al., 2009).
A call for strategizing in Higher Education has thus been posed by previous studies as,
even if strategy has always been a key topic investigated by scholars around the world
over the past fifty years, the use of strategic thinking and strategic frameworks applied to
Higher Education is still limited.
This paper enter the debate on the future of Higher Education and contribute to it by
providing an updated taxonomy of nine key trends and three core challenges to be
considered by Universities decision makers in their strategic agenda, thanks to a
structured literature review to the European Higher Education.
* Dr. Francesca Pucciarelli, Marketing Department, ESCP Europe, Italy
Email: fpucciarelli@escpeurope.eu
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Proceedings of 4th European Business Research Conference
9 - 10 April 2015, Imperial College, London, UK, ISBN: 978-1-922069-72-6
2. Literature Review
2.1. Strategy and Strategic Thinking Process
Many definition of strategy have been provided by previous literature.
Sola and Couturier (2014) propose an updated definition of the strategy concept and
authors identify three main components of any strategic thinking process undertaken by
an organization: firs assess the current situation in order to identify external and internal
causes to be treated, the so called “core challenges”; second design a plan, a number of
practical actions to launch for addressing identified open issues and focus the limited
organizational resources on specific goals; third, follows the devised roadmap to
overcome the core challenges in the pursuit of an higher purpose, the creation of value in
the long-run.
The heart and soul of strategy is thus the identification of core challenges, which has to be
carefully assessed and understood, to make sure that decision makers are addressing the
right problem. Analyze the current situation is not easy, core challenges are rarely well
defined as often a huge number of interrelated factors compose the whole picture.
2.2. The natural starting point of any strategy: the situational analyses
The situational analyzes encompass various angles of analyses, as both external and
internal factors influence the organization‟s competitiveness.
The external factors are, medium long-term variables, and cannot be directly controlled or
even early detected by organization‟s decision makers; whereas the internal ones, intrinsic
components of company life, are generally better known by its management (Tsiakkiros,
2002).
External factors could happen at an environmental level, with heterogeneous impacts on
different sectors, or at an industry-specific level. This outside-in perspective helps
organizations in understanding the rules of the game of their competitive arena, where
they stand in comparison to the other entities populating the sector, and ultimately how
current strategy is performing compared to its competitors.
Once external context is understood, the natural further strategic step will consist in linking
external pressures and opportunities with internal factors for design organization‟s
solution‟s space within which strategic initiatives can be developed and executed.
2.3. Strategizing in Higher Education (HE) sector
Change is as inevitable as the passage of time, but modern society seems to accelerate
the speed and complexity of challenges affecting HE each passing decade (Altbach et al.,
2009). Moreover as strategy is built on the twin pillars of knowledge of current situation
and uncertainty on how the future will looks like (Sola & Couturier, 2014), a continuos
effort in observing and anticipating the incoming issues and opportunities is continuously
needed.
It is important to underline that Higher Education‟s approach to strategic thinking has to
cope with a double level of value creation: at an organization level in sustaining single
University‟s competitiveness (Friga et al., 2003); and at sector level in providing value for
the society at large through knowledge creation and dissemination (EC, 2012).
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Proceedings of 4th European Business Research Conference
9 - 10 April 2015, Imperial College, London, UK, ISBN: 978-1-922069-72-6
In fact, Universities are forcedly asked to act as for-profit organization by belonging to a
marketized system; but, on the other hand they were used and still tend to reason more as
non-for-profit organizations, as HE is still at least partially considered to be a public good
(Nedbalová et al., 2014). If the acknowledgement of HE Institutions as competitive
enterprises can help produce excellence and efficiency, it is also true that it can contribute
to a decline in a sense of academic community and traditional values (Altbach et al.,
2009).
An intrinsic tension between market and societal logics has thus to be considered in
strategizing in Education.
A number of forces are putting in discussion the sustainability of traditionally managed
Universities (Nicolescu, 2009), and many attempts of isolating trends and challenges
impacting HE future have been proposed by prior literature.
Duderstadt (2000) propose a revolution of American HE system deeply rooted on two
pillars: academia leaders and entrepreneurial approach to University management. Author
firmly remembers that the ultimate scope of academia is, and will be, serving society by
the development of human resources in their lifelong learning path, thanks to learning and
knowledge-center focus; but, at the same time, HE Institutions need to evolve toward a
more business alike modus operandi as only the advent of Entrepreneurial Universities,
will ensure a bright future to academia in which prestige-driven and market-driven logics
will be balanced by HE Institutions‟ leaders in their decisions.
de Boer et al. (2002) propose an extensive review of trends in HE including perspectives
coming from different stakeholders: from supranational bodies, national governments,
agencies and advisory bodies; to scholars, academics and professionals; to Institutional
leaders and managers; and finally industry. The main end product of this research group
is a list of seven trends any University should consider while strategizing: 1. development
of information & communication technologies; 2. marketization in HE and science,
including the changing roles of governments; 3. globalization, internationalization and
regionalization; 4. advancing network society; 5. advancing knowledge society; 6. sociocultural and 7. demographical trends.
Friga, Bettis and Sullivan (2003) use Porter Value Chain to investigate changes in key
processes and value-creating activities in American HE. Authors focus on Business
Schools because they constitute one of the areas of greater growth in the US context, and
they are not isolated from trends and need of change affecting universities in general. In
Particular, authors choose the MBA as unit of analyses, as the introduction of ranking
systems in 1998 (in addition to the others supply and demand pressures) has fostered
further Business Schools reactiveness (i.e. in product thinking and packaging). Authors
conclude that “although the strategies and structures of business schools today are fairly
similar to those set out in the 1950s, there have been some changes- particularly related
to strategic emphasis, marketing objectives, and curriculum”.
Altbach, Reisberg and Rumbley (2009) investigate the unprecedented transformation
taking place on the HE context in the last two decades, isolating eight priority issues to be
addressed by Universities: 1. the changing patterns of enrolment, due to the deeper stage
of massification, which implies expansion in demand and major diversity in classes
composition; 2. the need for completion of access guarantee as gender inequality has
been eliminated, whereas many others remains; 3. the need for diversified academic
systems-hierarchies of Institutions: where top Institutions should keep raising the teaching,
research and admission level of quality to fight against the overall lowering in standards; 4.
the privatization issue and the relative need of strengthen Universities-Industry and others
key stakeholders links to ensure funding and other vital resources; 5. the need of strategic
initiatives to close the "digital divide", as HE Institutions attempts of leveraging web 2.0
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Proceedings of 4th European Business Research Conference
9 - 10 April 2015, Imperial College, London, UK, ISBN: 978-1-922069-72-6
and other emerging platform are in their early stage; 6. the concern for quality will be at
the top of Governments‟ agendas, as during the last decade quality-assurance schemes
for HE have been launched almost everywhere and its next stage will be the international
harmonization of the same; 7. the struggle for reinforcing the “soul” of HE as the traditional
societal mission of academia has been pressured by “commercialization” logics for the last
half century; 8. the professionalization of HE Management and Leadership, as HE
enterprise is simply too large and complex to be managed without data and
professionalism.
McHaney (2011) states that competitiveness of HE in the future will depend on digital
shoreline, highlighting that just adding technologies to current pedagogies and practices
will not be sufficient, whereas a complete rethink is needed. In fact, two seismic forces are
reshaping education system: first, the advent of Web 2.0, and the continuous proliferation
of digital media, environments, applications, platforms, and devices disrupting HE as we
know it; second, the inexorable influx of tech-savvy Millennials on campuses, their minds
set, behavior, and expectations about Universities user experience. Digital native
generation in fact asks for a new approach to learning shaped by social networking and
other forms of convenient, digital based (it includes mobile and tablets based solutions),
immediate, participative and personalized interaction.
The “Modernization of Higher Education” report (EC, 2013) focus on the quality of
teaching and learning, as educational models and organizations have to adapt to the
much more varied needs, as well as to massive changes in science, technology, work and
society. The outcome of this report is a list of thirteen recommendations: 1. Public
Authorities should ensure a well-funded framework to support HE future; 2. every
University should implement a strategy of continuous improvement, deeply rooted on
societal mission and active listening of key stakeholders; 3. HE institutions should
encourage students feedback to early detect areas of improvements; 4. continuous
professionalization of academics should become a requirement in the sector; 5. academic
staff promotions should take into account the teaching performance alongside other
factors; 6. Heads of Institutions should recognize and reward academics who make a
significant contribution; 7. curricula should be developed through dialogue among
Professors, students, and job market to ensure future students employability; 8. students‟
performance should be assessed against clear and agreed learning outcomes; 9. HE
Institutions and National Policy Makers in partnership with students should establish
mentoring programs to support students‟ journey to graduation and beyond; 10. HE
Institutions should promote interdisciplinary approaches to help students developing their
mind-sets; 11. HE Institutions, facilitated by Public Administrations and the EU, should
support their Professors in developing their online skills for leverage new pedagogies
opened up by the digital era; 12. HE Institutions should implement holistic
internationalization strategies for both students and Professors; 13. The European Union
should support the implementation of these recommendations.
Building on the privatization in education (de Boer et al., 2002; Altbach et al., 2009),
Schofield et al. (2013) analyze the marketization of HE (using the case of UK), and in
particular the influence of contemporary government policy and funding agenda, to
conclude that older and more traditional institution can fight the increased rivalry for
resources by continuing to build and trade themselves on their established strong
reputation. Nedbalová et al. (2014) aim to reconcile the marketization and marketing
perspectives (using the case of UK), demonstrating a bidirectional dynamic: market forces
strongly influence HE institutions, as well as HE institutions shape the environment via
marketing practices.
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Proceedings of 4th European Business Research Conference
9 - 10 April 2015, Imperial College, London, UK, ISBN: 978-1-922069-72-6
The marketing challenge, as consequence of marketization, has also been largely
addressed by scholars, with general studies applying broad marketing concepts to HE,
such as service and relationship marketing, scope, adaptation needed and limits (Maringe,
2006; Gibbs & Murphy, 2009; Nicolescu, 2009); and focused studies investigating a single
marketing objective or media in HE, as for examples: student consumer behavior in
choosing university and influence of traditional and new media (Helgensen, 2008;
Hemsley-Brown & Oplatka, 2006; Obermeit, 2012; Daun-Barnett & Das; 2013); website
usage in universities branding (Chapleo, 2004; Chapleo et al., 2011), social media
potential as instrument of universities students engagement and candidates recruitment
(Constantinides & Zick Stagno, 2011).
3. The Methodology
Methodologically a systematic literature review, aiming at collecting and conciliating
relevant future-oriented studies about Higher Education has been executed.
Wester and Watson (2002) state that literature review is an essential feature of any
academic project as it helps in defining the boundaries of the research, by providing a
comprehensive picture of current understanding on a topic and relative uncovers areas.
Moreover as HE is a mature topic where an accumulated body of research exists, this
research will build on previous knowledge and contribute to its advancement, by proposing
a synthetic and updated taxonomy of trends impacting academia.
Inputs of the literature review are the future oriented perspectives assessing HE situational
analyses and proposing recommendation for the future, which have been selected through
searches of electronic databases (mainly Business Source Complete, Emerald, and
Science Direct), starting from the studies containing the keyword “Higher Education” and a
series of variations of the initial keyword, such as “HE and 21st century”, “HE and
Strategy”; furthermore to retrieve other relevant studies to be inserted in the literature
review a snowball approach has been used.
A first evidence from literature review consisted in the observation of wide interest in the
topic demonstrated by the fervent production of articles in the last fifteen years and the
large number of journals addressing the topic (some example from ABS 2010 ranking:
Journal of Education Policy; Journal of Further and Higher Education; Journal of Higher
Education; Journal of Management Education; Journal of Marketing Education; Journal of
Vocational Education and Training; Quality Assurance in Education; Studies in Higher
Education; Teaching in Higher Education).
Once all relevant future oriented perspectives on HE have been collected, the analyses
and critical review of the selected literature has consisted in categorizing key trends
coming from previous studies in order to: i. confirm or disconfirm nowadays trends‟
validity, and ii. adding emerging trends affecting European HE coming from latest
literature.
Furthermore, in the third and last step of proposed methodology, the discussion of results
of previous research phases will focus on isolate the core challenges for the future of
Academia.
4. The Findings
Higher Education institutions are striving to re-think their strategy for the future to better
address nowadays increased complexity and new challenges coming from the
globalization and raising rivalry of education‟s market (Schofield et al., 2013).
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Proceedings of 4th European Business Research Conference
9 - 10 April 2015, Imperial College, London, UK, ISBN: 978-1-922069-72-6
In particular nine macro trends are curbing the effectiveness of single HE Institution
strategy and competitiveness:
1. HE institutions, key processes, and key activities digitalization: as traditional
education channels and pedagogies are substitute by online solutions,
immediate and more efficient solutions (Altbach et al, 2009; EC, 2013)
better matching expectations and needs of participation expressed by techsavvy Millennials (Maringe, 2006; McHaney, 2011).
2. HE is a crowded marketplace with new rules for competing (Hazelkorn,
2008; Altbach et al., 2009), assisting to a further stage of transition from
pure non-for-profit logics to more entrepreneurial approach to University
management, by maintaining firm the ultimate societal scope of Academia
(Duderstadt, 2000, Hemsley-Brown, 2011).
3. The support of European and National entities will be fundamental to
preserve quality standards, access guarantee, and ultimately a better match
with tomorrow‟s job market requirements for employability (de Boer et al.,
2002; EC, 2013; Nedbalová et al., 2014). Whereas at single HE Institution
level an open issue to consider will be the continuous effort in sustaining the
professionalization of academia leaders and academic themselves (
Duderstadt, 2000; Deem and Brehony, 2005; EC, 2013) for not incurring in
the risk of lowering the academic standards in favour of consumeristic
approaches (Altbach et al., 2009; Brown, 2011).
4. HE is a global market and such as has to cope with an increased rivalry at
international, national and institutional level (Schofield et al., 2013), and in
ultimate instance Universities need to act as market players, and market
themselves (Friga et al., 2003) thanks to holistic international strategies
(Nicolescu, 2009; EC, 2013).
5. HE should proceed in leveraging network opportunities and experimenting
further collaborations with key stakeholders and new forms of organizations
(de Boer et al., 2002; Friga et al., 2003) to strengthen links with Corporates,
National and Supranational Institutions, (Altbach et al., 2009; Schofield et al.,
2013; Nedbalová et al., 2014) and thus ultimately ensure both better access
to funds and better orientation to students during their studies and in their
entrance in the job market (EC, 2013).
6. The strategic value of research and knowledge creation should be preserved
(de Boer et al., 2002), where the value of knowledge is pressured by the
need of commercialize it to contribute to Universities funding (Altbach et al.,
2009).
7. Incoming flux of digital native generations asking for a different educational
experience should be considered and addressed with more participative and
digitalized solutions (McHaney, 2011).
8. The growth on population is seen as a driving force for He development, as
an increasing number of candidates could be willing to access HE, and foster
educational system reforms for a better diversity inclusion, as the expansion
is not just in volumes of students but will encompass also an enlarged social
and geographical base (Friga et al., 2003; Altbach et al., 2009).
9. Marketplace changes fostering HE specialization and differentiation (Altbach
et al, 2009) as tomorrow job market will require a participative revision of
curricula, including in its re-design from students to Corporates, for better
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Proceedings of 4th European Business Research Conference
9 - 10 April 2015, Imperial College, London, UK, ISBN: 978-1-922069-72-6
addressing relevant skills and enlarged competences base needed to
enhance students‟ future employability (EC, 2012; EC, 2013).
A number of major institution wide shift are thus necessary to ensure a bright future to HE
institutions and enabling the educational system transformation journey.
By analyzing the trends affecting Higher Education, three core challenges seem to emerge
by previous literature.
Core challenge 1: Enhance HE institution’s prestige and market
share in a consolidating global educational market
Core challenge 2: Embrace deeper entrepreneurial mindset, modus
operandi and decision making
Core Challenge 3: Increase connection, interaction, and value cocreation with key stakeholders
5. Summary and Conclusions
This manuscript provides four contributions to Higher Education Research.
First it contributes to the theory by acknowledging a call for a systematic application of
strategic thinking process in Higher Education sector. Our review of the literature
highlighted that, despite scholars‟ wide interest on strategy, there is still a limited number
of application to HE. Therefore, we proceeded on selecting and analyzing previous studies
containing future-oriented perspectives, searching for the key trends driving the change of
Academia in the 21st century, in order to map and reduce complexity by categorizing
environmental trends.
A second contribution consists in the proposition of an updated taxonomy of nine trends
affecting HE future. Where some of the isolated trends are not new in the fields, such as
the increasingly marketization and internationalization of the educational sectors which
brings into the equation for-profit logics into Universities‟ management and
communication; others trends are presenting a deeper stage of advancement, which
regards for example the massification of the HE and the advancement of ICT with
continuously introduce innovative and more efficient solutions to reach an enlarged
demand; and finally some of the trends proposed emerged just in recent year, for example
the theme of employability insurance has gain increasing attention because of European
economic situation and its dramatic unemployment rate.
Based on the systematic analyses of the literature author was able to draft a shortlist of
most urgent trends and core challenges to be addressed by European HE, nevertheless
this map represents a starting point for further investigation.
Third the manuscript provides food for thoughts for Academia‟s decision makers by
proposing a shortlist of three core challenges to be addressed by HE Institution strategy,
maintain the coherence with the ultimate societal scope and values of education sector.
Fourth the paper raises a number of interesting issues for further researches in order to go
deeper in the re-thinking of academia of the future, namely the validation of proposed
trends include a call for definition of possible strategic alternatives and initiatives to
overcome HE nowadays and future challenges.
A research has been designed to illustrate the possible strategic reactions available to
European HE Institutions. A blended methodology will be used to achieve the research
objectives, in particular: a benchmarking of strategies deployed by top European
universities will be performed through content-analyses of information available in selected
institution‟ websites (e.g. mission, program offering, strategic alliances, etc.); then,
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Proceedings of 4th European Business Research Conference
9 - 10 April 2015, Imperial College, London, UK, ISBN: 978-1-922069-72-6
structured interviews with educational Institutions decision makers will be organized to
discuss both core challenges, strategic guidelines to overcome them, and devised
strategic actions. Finally a series of focus group with key stakeholders, students and
professors in first instance (industry and staff in a second step) will be used to refine the
outcomes of previous phases and guarantee a correct comprehension of “must have”,
urgency and feasibility of isolated strategic initiatives.
The proposed methodology will not just lead to viable strategic actions immediately
transferable to HE Institutions decision maker‟s practices, but will also test the goodness
of the methodology in itself.
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