Your University Is a Business. Are You Managing It Well?

Anyone following higher education on LinkedIn these days reads a lot on of the value of a degree and the future of the universities. A deceptively simple question lurks under the conversations: is a university a business?

Yes, it is. YES. IT IS.

What is the primary purpose of a 21st-century university in the United States? To provide “an education,” “courses,” “a program of study” or “a degree.” The precise answer depends on whether someone sees it as a single entity or a collection of parts, the process or its outcome, but they’d generally agree that a university’s sine qua non lies in its course catalog and class schedule.

As for the research universities who consider teaching a secondary function: I challenge you to announce you’ll stop offering classes once all the current students graduate so faculty can focus entirely on research. Let’s see how that goes down.

Now, is there any university offering its degree programs free to anyone who enrolls, no strings attached? I’m guessing not. (If so, please tell me who is. I’d like to check it out.) Payment is involved. That’s a pretty elementary description of a business.

I’m not contending that a university is a for-profit business or that its primary purpose is its only purpose. I’m pointing out that universities have bills to pay and a budget to balance just like the rest of us.

Under all the layers of grandiosity and ritual, the university is a business. It has capital assets. It has employees. It has customers: students. It’s subject to principles of economics.

This next part is where it gets hairy. If the university is a business, which aspects of university operations are best driven primarily by economic considerations and sound business-management practices?

I tend to agree with academes concerned that adopting a purely market-driven curriculum is a myopic direction that will come back and bite us in the national economy down the line. And I certainly don’t want universities to embrace “the customer is always right” when it comes to academic standards or student discipline. What a traditional university offers is not a straightforward service or product but a contract, and both parties — the school and the student — need to meet defined expectations.

But that’s not what this post is about.

It’s about this: higher-ed institutions are less than excellent at the nuts and bolts of business management. They are particularly not excellent at recruiting and retaining top-notch staff; making far-sighted decisions about technology infrastructure and systems; and looking outside their immediate region for ideas.

Career university administrators* frequently disrupt day-to-day operations by imposing decisions without learning the inner workings of those operations. Committees of faculty and staff appointed to guide university affairs demonstrate that the whole is, in fact, considerably less than the sum of its parts.

Universities have a number of departments that operate best under supervisors who have mastered sound business principles and practices. These include accounting, purchasing, human resources, the physical plant, information technology (specifically, enterprise systems, other databases and physical infrastructure), the print shop and the public information office.

And the web. The virtual campus.

Do you know how many visits your university or campus web site had in the past week? I checked the stats for one campus for the week of June 1-7. Google Analytics recorded nearly 4,500 visitors, more than 45 percent of whom were new.

How many people visited the physical campus during the same time period? Two hundred? Certainly not as many as five hundred in a week when school’s not in session.

Even after adding employees to the count of people on the physical campus during that time and assuming half the Google Analytics figure is web crawlers instead of people, the virtual total is larger. Add in unique visits to 50 school and departmental web sites on campus whose numbers are counted separately, plus stats for webmail, web access to enterprise systems and the course-management systems, and the numbers aren’t close. More people visit the virtual campus than the physical one.

The first principle of the virtual campus is that it’s for the visitors. The best business practice is to build the web site around the visitors. The university is a business. Therefore, the university should build its web sites to meet the needs of the visitors. Current and prospective students — that is, current and prospective customers — comprise the largest and most important visitor demographic. (And if they don’t, why not?)

It’s time to treat the web as the critical business asset it is, starting with removing it from the oversight of an administrator with no background in web technologies or a committee of faculty and staff. Web developers have more effective ways to gather input from faculty, staff, administrators and students. We need to put these to work at universities.


*By which I mean supervisors who rose through the ranks at one or more universities as opposed to those who came to a supervisory position in higher education from a professional office or corporation. Yes, there are exceptions. I … haven’t thought of one yet.