Alex Usher of Higher Education Strategy Associates asked some interesting questions in his morning blog post. The world of university funding in Canada is changing – there is more money overall for universities but governments have been paying a declining share of university operating budgets with the remainder coming from tuition and assorted sources of research and contract funding. Indeed, a lot of new government money is targeted towards capital projects or new student support programs rather funding what faculty often see as core teaching and research functions of universities.
Usher maintains that faculty need to come to grips with the fact that a rising share of their salaries is being paid for by tuition which makes the student experience more important and part of that experience is based on non-essentials like residences and student services. However, on the management side the greater reliance on non-governmental funding has fueled an entrepreneurial spirit that leads to the question of accountability when new initiatives do not pan out. As he writes: “Shared governance of universities is a lot easier when government’s paying the bill. When universities have to go out and earn money themselves, it’s a different story. But it’s a reality we have to deal with. Faculty need to come to terms with the fact that income is a lot more fragile than it used to be, and administrators need to be held much more accountable for money put at risk.”
I think part of the issue here is that there is an ongoing shift in how university success is being measured and who bears the benefits and costs of pursuing success. In return for public funding, universities are being judged by government funders with a set of pseudo private sector criteria. How many graduates get jobs? How much has enrollment increased? Funding is tied to these indicators in the form of per student grants tied to enrollment. Universities are increasingly taking entrepreneurial risks in launching new campuses or programs designed to attract students in an effort to increase their revenues. If the new initiative is successful, there are additional resources made available to the university but they often tend to accrue to the programs, faculty and students that successfully drove the spending increase. Many see this as fair - especially faculty in the successful programs. However, if these new initiatives do not pan out there is an immediate impact on budgets and the entire university community bears the costs – faculty, students and programs. Entrepreneurship at the university level means that the costs and the benefits are borne asymmetrically.
Contrast this with the faculty side of things. On the faculty side, there has always been entrepreneurial behavior when it comes to an academic research career. Academics are actually quite entrepreneurial when it comes to their own careers as they “market” their research to peers at conferences, assemble research teams and grant applications, and advance their research programs. Often, they take risks in pursuing their own ideas. If they are successful, their research takes off, publications and more grants ensure, and they develop national and international academic reputations. If unsuccessful, then the academic bears the cost quite directly in terms of a quite diminished research career. True, they can shift to a career that emphasizes more service activity or teaching, but there is not an expectation that the “university” will help salvage their research careers. While there are many kinds of student support services and assistance centers to promote student success, as a faculty member you truly are on your own.
In the end it is all about incentives and the distribution of costs and benefits. The immediate short term goals of the “university” – more revenues, program expansion, higher enrollment, balancing the budget – diverge from the longer-term interests of its prime human capital resource – the faculty – who measure their success by research publications, grant success and peer recognition – peers who tend to be faculty in an international community and not their university’s administrators. In a sense, it has always been so but it seems to have become starker.
It is not that there should not be more overlap. Successful researchers and academics boost the reputation of their university, which assists university administrations in attracting more resources. This means potentially more resources internally for academics and their projects but these effects are often more of a spillover than directly linked cause and effects. What is the mechanism to capture these benefits and costs in a manner that does not lead to a separation in aspirations?