Tag Archives: Coronavirus crisis

Higher Education and the Coronavirus: Never Waste a Good Crisis

Higher education is about to experience a sharp shock caused by the coronavirus crisis.  The buoyant market for international students is likely to contract significantly as uncertainties around travel continue. Local markets will be under pressure as universities struggle to open and students baulk at the experience (and cost) of online learning. This week has brought us new insights into how universities might fare.

Tale of Two Cities

Some universities, including Harvard, have decided to offer online only in the new academic year. In Harvard’s case this will be for the same tuition fee as the campus experience – about $50k.  The expectation is that the brand power of these institutions is so strong that students will still enrol. Furthermore, their premium brands will help them to monetise their newly online offerings in international markets and they will likely also compete more aggressively in their home markets. This pivot in the business model, coupled with their endowments, should enable elite and higher end universities to weather the storm.

Elite universities will use their brand power to adapt and the weakest universities will struggle for survival.

Other universities are at significant risk of insolvency. The BBC reported this week that 13 of the least prestigious universities in the UK are potentially in trouble, facing lower student income and high costs.  Without major restructurings and bailouts, there may be casualties.

Third Way

What if you’re a mainstream university, not at either of these extremes?

Most students aspire to the “life” and “live” experience of the campus above a laptop

Mainstream universities wanting to secure enrolments at scale will have to find safe ways to offer a campus experience for their existing core business. I would do three things:

1. Go blended: transform the core offering to lectures online and tutorials face-to-face

Most lectures will have to be delivered online, to avoid mass spreading of the virus via auditoria.  Unfortunately this will likely lower the attractiveness of the overall learning experience and also increase the risk of drop-outs. The best way to remedy those disadvantages is to concurrently increase the use of (preferably) face-to-face tutorials individually and in small groups.  A higher intensity of interaction with faculty can improve learning outcomes and boost student engagement.  This will be quite demanding on faculty, who will need to become expert in online teaching and commit more time to tutoring.

2. Find new markets: use digital and local relationships for new sources of income

I would in the first instance probably prioritise two areas if a competitive advantage can be found. 

Firstly, open up the new digital offering outside the campus – both as a degree and in modular and snackable programs.  Is there something distinguishing about the content/courses you offer (London & finance, Milan & fashion, Bordeaux & wine) that you can take global now you are digital?  Is there something in the user experience of your digital learning offering that sets you apart (for example GetSmarter deploys real tutors to assess assignments)?  Is there a price point that makes you competitive to new segments?

Secondly, given that digital offerings will be abundant and everybody is going global, why not go back to the roots of the establishment of your institution and go local.  There are major upcoming skills gaps in healthcare, teaching, technology and so on.  Why not partner with local industries, and local health and education authorities to better support employment needs of the local market.  It will be much harder for digital universities on the other side of the world to win that competition.

3. Fix the finances

Regrettably it seems inevitable that the cost of running some universities will need to be reduced and become more flexible. A large part of the cost base is staff and buildings. Painful. This should be considered together with the change in operating model needed to deliver blended courses described above.  In addition, it might be necessary to raise additional financing, through government loans and grants, bank loans, and alumni gifting, to bridge the overall transformation.

Never waste a good crisis

The triggering event of the coronavirus is a painful crisis.  It’s also an opportunity for us to re-design education for increased access, higher learning outcomes, improved employability locally and better affordability.  Let’s not waste the crisis.