Australian universities: thriving in a changing world?

University sectors in Australia and across the world are facing an inflection point in their future trajectories. The COVID-19 pandemic has undermined business models built on international student income, radically changed the student experience and upended norms of academic behaviour – particularly around conferences and travel.

To help tackle questions around how universities can decide on robust strategies in this context, we explored a range of trends and issues in the university sector, and project possible pathways out to 2028, to understand the likely directions of change in the sector. These trends and issues coalesced into a number of challenge scenarios to test potential strategies against, and to identify likely successful approaches.

The main finding of this work, that the Australian university sector will likely look very different in 2028, is less surprising than the reasons. While the COVID-19 pandemic and associated travel restrictions has triggered an immediate crisis that will drive ongoing change, the most important factor is a technology-triggered shift over the past few decades in the perceived value universities bring to our society.

In the world in which most Australian universities were founded – and notably the norms and incentives that drive much of their behaviour – systematic research was scarce and access to cutting-edge information was very limited in Australia. Universities provided significant societal value both through research and knowledge generation but also by facilitating far greater knowledge transmission into Australia. Put most simply, the internet and the globalisation of the research sector has fundamentally changed this model. Global funding for research has exploded across all sectors and there are now practically no technical barriers to accessing knowledge from anywhere in the globe.

The critical challenge today across all sectors is not finding or generating knowledge, but making sense of the vast amount of knowledge that we can all access. The societal value that universities can bring is therefore shifting in the same direction. This structural shift in the nature of our societies is already being reflected in changing priorities for funding universities, both from public and private sources.

Successful universities, measured both by delivering societal value and their balance sheet, will need to adapt and in many case shift the balance of internal activities and priorities.

The amount of funding available for fundamental knowledge generation or universities as independent producers of knowledge will shrink – both as a result of the shrinking international student pool and funding priorities from governments and the private sector. Funding to work in partnership across sectors to help people make sense of and apply research and expertise will likely increase. Expectations on higher education are shifting similarly. People and organisations will increasingly want help to understand, think about and assess the information they can access on their phone or computer. A rewarding future student experience will focus more on training people how to think clearly and equipping them with the right skills, rather than teaching them lots of information. Universities, and particularly research intensive universities, will be faced with a stark choice. They can continue to primarily focus on their traditional roles – at a far reduced size and scale. Or they can embrace the societal demand for partnership and co-design, which will (in many cases) require a significant rebalancing of priorities, people and skills.

There will be a temptation to simply add ‘co-design’ to the ever growing list of performance criteria for academics and researchers. However, experience suggests that it may be more effective to invest in hybrid or boundary teams in the university to focus on this work. Partnerships across sectors, public influence and co-design require distinct skills and experience that few academics currently possess and are often best sourced elsewhere.

This tension points to a broader structural issue. The Australian university sector is largely homogeneous with the majority of universities adhering to a similar model – encouraged by market dynamics as well as regulation and funding bodies. For a range of reasons, including budget difficulties, international competition and societal demand within Australia, we expect this homogeneity to be untenable and universities will need to increasingly define their own unique place within the national and global sector.

This report recommends three high-level strategies that universities should consider as a way of setting themselves up for future success. As high-level strategies for a whole sector, these necessarily read rather a lot like a collection of buzzwords. Chapter 2 of the report contains a range of ideas about how to flesh these out into more concrete strategies