Saturday, March 17, 2012

A Note on Independent Colleges in Britain

In a sense, the independent higher education sector in Britain is incapable of thinking. Having spent some time in the sector, talking to and pleading with various entrepreneurs, I have come to the sad conclusion that this very entrepreneurial sector may be too opportunistic. I have no issues with opportunism, and understand that this is a necessary trait for entrepreneurs: But, there are times, and we are at such a juncture right now, when strategic thinking and that 'vision' thing is somewhat needed. Plain opportunism, at times like this, creates a sort of thought paralysis.

To be fair, most of the colleges in the sector are owned and run by owner-operators. Professional management is quite rare, and the businesses are quite small compared to their impact. This is the key reason why the capacity to think big and bold is rare, and strategy mostly means tinkering around the edges rather than any meaningful approach to the future. However, at this juncture, strategy is no longer one more thing to think of - as most college leaders treat it to be - but quite the key to continued survival of the sector. 

This is primarily because of the visa rule changes, which has made Britain a less attractive destination, and the burden of these changes has fallen disproportionately on the independent colleges. Students studying in these colleges can not work, can not bring their dependents, can not have an internship, can only do certain types of courses, must have an almost endless flow of money available to them at all time and finally will have no rights to settle, or even stay for while after their studies, in Britain. The policy-makers fundamentally altered the landscape to reallocate a space to Independent colleges they were so far unaccustomed with, that of the service of rich and the famous, may be assisted by oil wealth: This was the territory of elite British universities so far, and will indeed remain so. The traditional territory for Independent colleges - the middle class middle ability international students who can't afford to get into British universities initially but were pulled no less by the aspiration - was wiped off by these changes. The enrolment figures, thereafter, have dropped by at least 60% in almost all colleges, and while various improvised arrangements are being made by different institutions, students remain highly sceptical and no discernible lift-off has happened anywhere so far.

The response in the independent sector has primarily been two-pronged. First, there is a scramble for what the UK Border Agency calls 'Highly Trusted Sponsor' status, a sort of arrangement where the college demonstrates the robustness and sustainability of their processes, and the UK Border Agency, once satisfied, grants them a little relaxation on what they can or can not do. This still does not earn its students work rights or any comparable privileges as in a public institution, but it lets them continue to recruit students internationally. However, since every college has to be Highly Trusted Sponsor to continue, this much coveted status has now become like having electricity: You need to have it, but if you have it, it does not create a competitive advantage. 

The other response was to pursue the 'Home' students. There is an assumption that there are lots of British students who are not finding an university to go to, and independent colleges can service this excess demand. This is a valid strategy, as the independent sector often works as demand-absorbent in other countries. However, in Britain, the excess demand is lower than one would imagine, and even the demographic bulge that is creating it now will level off in 2015. Indeed, the independent colleges can service emergent areas of demand, or specialised fields, but their efforts to recruit the usual business studies students have so far gone nowhere. This problem was further accentuated by the fact that most independent colleges were heavily focused, at least so far, on postgraduate programmes, which are popular among international students: This did not translate at all into 'home' student market. 

At this time, sobriety is returning to the sector as the effects of the visa changes start settling in. Many colleges are closing shop, unfortunately leaving their students disenfranchised, but at the same time, there is a growing consensus in favour of self-regulation and creation of safeguards for the students, and a reinvention of the products and ways of doing business. In the new climate, innovation is the key. While many independent colleges I know of are prepared to sit out this year with the hope that normalcy will return in 2013, they can not afford to sit still. The idea of a college is changing: Interrogating what an independent college stands for and providing a clear answer may be the way to start for independent colleges. They have to innovate their way out of trouble and reinvent the business altogether.    


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