Wanted: new model required for tertiary education leadership, financing

Winston Adams, GUEST COLUMNIST

The Jamaican environment in which tertiary institutions have survived over the past decades has changed radically. Provision of free higher education no longer exists with the decrease of aid by respective governments. Simultaneously, the cost of tertiary education continues to rise significantly. All of these problems, together with the differing international and national education systems, have resulted in substantial challenges for local tertiary and higher educational institutions.

The usual governing political parties' stated financing policy is that, depending on policy priorities or the economic circumstances at the time, public tertiary institutions are funded either on a per student basis, in relation to a percentage of the economic cost, or funded on the basis of recovery for staff cost. However, is this the best model going forward for the sector?

Case for the continued re-allocation of public financial resources

With the advent of globalisation in the 1980s, the focus has since shifted towards making even public tertiary institutions, including universities, operate as business enterprises. The argument put forward in this regard is that by such a change, these institutions would become more competitive, not only nationally or regionally, but globally and gradually reduce their reliance on public support by outsourcing funds and becoming much more efficient. It is a known fact that, despite the continued subventions received by public tertiary institutions from the Government, for more than a decade now, these subventions have been steadily declining. The reality is that this trend will continue and become even more progressively severe in the future. Even public tertiary institutions, therefore, will be forced to become more self sustaining and more innovative and entrepreneurial in their practices so as to remain financially viable.

Similar to any other sector, it is indeed a fact that the tertiary educational sector also seeks innovation in order to maintain and thrive in the competitive environment. As such, they will have to begin to recognise new potential methods to counter current challenges and improve their own financial performance without relying heavily on receiving further State funding.

On the other hand, it is my firm view that any additional State funding that may have been earmarked should, instead, be directly injected into capitalising the Student Loan Bureau (SLB) each year or in establishing a new or appropriate revolving educational student-financing entity. In this way, prospective students seeking to pursue their further studies, at either private or public tertiary institutions, will have much easier access to a greater pool of low-interest funds which will allow them to make their own decisions as to which recognised/accredited institution of their choice they wish to attend. This is how the free market works in other sectors, and, indeed, should be applicable to the higher-education sector also.

Recent study and implications for leaders and tertiary institutions

The proposed shift in paradigm pertaining to the increased re-allocation of government financial resources from the public tertiary institutions toward placing instead in a much larger pool of public funds to increase student access, will also have immense benefits for the institutions themselves.

In a recent longitudinal quantitative study concluded earlier this year, it was shown that public tertiary institutions, in particular, are indeed losing the competitive battle in the higher education landscape. The study sought to determine what practices might benefit the innovation of the public higher-education sector in Jamaica. As such, it outlines some specific strategic and financial practices and methods that can be easily applied and utilised by the leadership and management of tertiary-education institutions. Based on this information, additional valuable insights can be gained about the problems faced by the sector and how these problems can be better managed, while creating and promoting a culture of innovation and change.

Indeed, as expected, the findings also indicate that many public tertiary institutions continue to experience diminished access from the state to adequate and sustaining capital resources. Approximately two third of the tertiary institutions studied lost financial strength and deployed strategies that failed to relate to long-term viability. Despite the discovery that these institutions continue to change many of their strategies, more than 60 per cent of them seemed to have exhibited deterioration of financial performance.

Unfortunately, many leaders of these institutions have not undertaken the kinds of transformations needed to assure the long-term survival of their institutions. Only approximately 25 per cent of institutions in Jamaica gained some marginal financial strength. The findings further suggest existing management, leadership, and governance structures and processes of public tertiary institutions did not facilitate a strong foothold for these institutions in the tertiary and higher education industry in Jamaica. In short, most small and medium public-tertiary institutions, in particular, in Jamaica are gradually losing the competitive battle.

The main benefit of the study, however, is that it provides institutional leaders, of both public and private institutions, with new information to help guide strategic decision-making and reduce institutional vulnerability. Although the study offered no clear remedies for declining state funding and financial performance, the conclusions suggest careful scrutiny of deployed strategies in combination by educational leaders with diligent monitoring of financial performance.

Recommendations for institutions and their leadership

It is evident that both private and public tertiary institutions need to investigate new approaches to management, leadership, and governance that develops, articulates, and moves their institutions toward the future in a highly informed, comprehensive, carefully orchestrated manner. Essentially, the leadership of these institutions must begin to explore innovative strategies, such as configuring endowment to protect the institution from disruptive market forces and assessing the implications of current strategies within the context of long-term viability. Notwithstanding these existing disruptive market forces, I do believe that with more effective and innovative strategies, tertiary education institutions, in general, will be able to collectively increase their capacities to better control their own destinies.

Given the rate at which the financial conditions of public tertiary institutions, in particular, have declined, the need to identify positive relations between financial performance and strategies is most urgent. It is clear that leaders of these institutions should seek to assess the long-term benefits of current strategies in terms of capacity to assure long-term viability. Determining effective and appropriate sets of strategies for each institution requires a new leadership model or paradigm that expands perceptions of the environment, engages expertise from beyond traditional boundaries of the academy, and explores new strategies related to the core mission of providing educational opportunities. Undoubtedly, Jamaican tertiary institutions need to reorient existing leadership models from exploitative to exploratory to shape alternative strategies.

There is a clear and compelling case, therefore, for institutions to develop new leadership strategies to improve their own financial results that will make them more financially independent of state funding. In this way, the state will be able to more effectively reallocate, manage and optimise the use of its limited financial resources, which would then be made available directly to a much larger pool of eligible prospective customers or end users - the students themselves who should indeed be the chief beneficiaries of these funds.

Dr Winston Adams (JP) is executive chairman and president of the University College of the Caribbean (UCC) and vice-president of the Jamaica Association of Private Tertiary Institutions. Send feedback to wadams@ucc.edu.jm and columns@gleanerjm.com