Over the past few years, I have seen how the financial challenges facing UK universities have impacted the work of their executive teams (Funding model for UK higher education is ‘broken’, say university VCs). It is clear that the current financial landscape means that embedded assumptions about “how we do things around here” are being challenged.
Universities are actively developing new business and operating models with the immediate focus, understandably, on achieving financial sustainability. For a number of institutions, these new models will invoke significant change. Some of this change, as we have already seen, will involve pragmatic short-term decisions focused on efficiencies and cost-cutting (UK universities must cut costs to survive, warns Augar). However, to achieve financial sustainability, my message to leaders is to invest in culture.
As university business and operating models continue to adapt and evolve, I believe that creating a resilient and enabling culture is not just desirable but necessary for universities to thrive.
An investment in culture should start with the top team. The team should seek to understand the ‘cultural footprint’ they are making on the organisation. In my experience, some university executive teams do not consider themselves to be an integral part of organisational culture – but as something the team sits outside of. By understanding and refining the team’s own cultural footprint, university leaders can set an example for others to follow. It is also important that an investment in culture clarifies what behaviours and ways of working across the university need to be preserved, developed, and left behind.
Through my work with universities, I often frame conservations about culture change around the need to build the adaptive university. The adaptive university has the ability to pivot and change in response to the challenges and opportunities of a fast-changing world, it learns quickly and places people at the heart of thought and action. An investment in culture is an investment in the adaptive university. From working with universities across the world, I have observed five cultural priorities which are at the heart of the adaptive university.
Learning
Becoming rigid in one way of thinking is risky. To embrace new ideas, the most successful universities are willing to unlearn existing mental models that no longer serve a purpose – and learn new ones. Providing an environment that fosters learning (unlearning) and curiosity is key to developing an adaptive university.
Empowerment
Too often, executive teams can get bogged down in details, risking both a loss of perspective and creating bottlenecks in decision-making. This can be exacerbated in periods of organisational stress, where there can be a tendency to take control and consolidate power. This can disempower and deskill the next level of leaders. High-performing executive teams focus on what only they can do, while empowering others to handle the rest
Innovation
Global disruptor universities have embraced low-hierarchy cultures, making it easier for ideas and improvements to come from any level. These universities have embraced a culture that helps reduce the fear of failure by promoting psychological safety – an essential, but often overlooked, part of innovation. The most innovative universities model ‘failing fast and learning quickly’ as a core strategy for innovation.
Entrepreneurial Mindset
Purpose-driven institutions find creative ways to achieve their strategic goals despite resource constraints. These institutions have fostered and developed entrepreneurial ecosystems that produce the courage and curiosity to find new ways to create value and implement sustainable solutions. An entrepreneurial spirit runs through all parts of the university as an antidote to learned helplessness.
Collaboration
Forward-looking universities are moving from competition to collaboration as a key driver of culture. Internally, some universities have seen that competition for limited resources only serves to worsen culture and breed distrust. They understand the rewards of collaboration should far outweigh the risk of going it alone. Externally, policy often pits institutions against each other, but an increasing number of universities are pushing back by building collaborative cultures that pool resources and ideas for greater impact and to strengthen the higher education ecosystem – enabling the sector as a whole to grow sustainably.
By investing in culture, universities can position themselves to not just survive but thrive in an increasingly complex and resource-constrained environment. Ultimately, culture should not be an afterthought for leaders in higher education. It is the key enabler of strategy, and by extension, the key enabler of financial sustainability.
by Richard Sharpe, Principal Consultant and Managing Director