September 2011 saw the launch of Efficiency and effectiveness in higher education, a report of the Universities UK Efficiency and Modernisation Task Group led by Ian Diamond.
If you’re thinking that the university sector has spent a disproportionate amount of time thinking about efficiency over the years, you need to recall that for the vast majority of the post-war period universities have been systematically underfunded.
The brief period between 2012 and about 2017, when undergraduate fee and other government income broadly matched expenditure on a good day, was a historical anomaly.
There apparently was a “golden age” – probably not in my lifetime – when universities were awash with cash. If you can put a year on this, please leave a comment.
A crucial moment
In 2011 the background vibes were all about post global financial crisis austerity – this was the coalition era of “broken britain” and “we are all in this together”. Nick Clegg was running a “red tape challenge”, seeking ideas from within the Civil Service to save money (that’s the reason your kids don’t get a physical national insurance card any more).
So Diamond’s opening note that “this report comes at a crucial time for higher education” never rang more true. The fee rise was in the bag, but the codicil was that the sector was expected to become more efficient. With a large and growing sector (recruitment caps were becoming a thing of the past), the task group saw opportunities to leverage the combined purchasing power of universities and colleges, simplify and standardise processes with the eventual aim of allowing for a degree of shared service provision, and there was the potential for private sector input too.
In some ways 2011 wasn’t that long ago. It’s worth another look at Diamond’s conclusions, and having an eye on what has happened (and what hasn’t) more than a decade ago.
Everything is about data
It is fairly difficult to be clear precisely how much it costs and should cost to run a university, in the abstract. At least, it was in 2011 – though things have improved somewhat since then there are still large and surprising gaps about what we know, particularly at a sector level. At the time the proposal was focused on aligning HESA finance data and TRAC collections – something which has, to a degree, begun to happen.
While most finance directors will have some idea about their own institutional costs, there is a lot to be gained from comparing and contrasting them with comparators. Benchmarking is commonplace in UK higher education, with every university having an (official or ad hoc) list of similar providers that can act as an example or cautionary tale. Again, the data wasn’t really there to do that in 2011 – things are a little better now, but the TRAC sea change I think we were all hoping for has not transpired.
Of course, there are various other benchmarking initiatives around the sector (on everything from digital readiness to estates planning) – these are incredibly useful for professionals in those fields but every one of them seems to be developed from scratch. Generic frameworks and tools would help cut some of the costs here, and would start to make benchmarking with other sectors easier.
Streamlining, shared services and shared resources
Every university has its own way of doing things – indeed, if you are in one of the UK’s more storied providers this applies to every faculty, every school, and every course. Such adaptions to what is generally intended as a single system to rule them all arise over multiple iterations – they are “paths of convenience” that would quickly be re-established after a reset. Sometimes this is due to unique circumstances or professional requirements, but these drivers are very hard to separate out from a more general resistance to change.
This is efficiency – after a fashion – but it does stand in the way of one popular proposed efficiency measure: the idea of sharing services and resources. As UHR’s Helen Scott outlined on Wonkhe earlier this year, this is seldom straightforward – but there are success stories. If you are reading this article on campus, chances are you are connected via the Janet network provided by Jisc. Various other services you interface with every day (from journal subscriptions, to mains power purchasing, to cybersecurity) are also pooled across multiple institutions. The ability to set up cost sharing groups to save on VAT has helped in many of these cases, though it is not the easiest thing to do.
To realise shared service savings, you need to standardise and streamline internal processes – something which can save a great deal of money (if done well) before you even start thinking about actually sharing. Even then, the savings are a long way down the line – this isn’t an emergency cost saving measure you blast through during a bad year, ideally the strategic or process rationale is driving the project and it dovetails with everything else you are up to. Nobody seriously thinks that sharing back-office functions would realise any kind of savings at all in the short to medium term – but universities ideally will be around for longer than that.
Finally, we raise the spectre of competition. There is a school of thought that suggests a competitive marketplace is the best way to drive efficiency, but over here in the real world competition is directly antagonistic to the kind of shared savings we are talking about here. If your strategic mindset is zero-sum then the very idea of collaboration is an anathema. Do we want the sector to survive or just certain (your) institutions? That’s very much a discussion that needs to be had, and at the highest level.
Buying stuff
Shared procurement is a winner. If the whole sector is buying web hosting from Microsoft, or journals from Elsevier it can generally cut a deal. UK higher education isn’t a big enough market to shift vendor priorities, but a big chunk of the sector spending money together is something that can absolutely move the dial. Again, this has tended to work better in “non-competitive” areas, and the Diamond review highlighted the possibility of sharing services outside of the sector, including with public sector bodies.
As is often the case, there’s been some interesting practice at the newer end of the sector. IndependentHE’s “many hands” project saw providers collaborate to design and commission a mental health peer mentoring scheme – with tiny institutions struggling to offer a viable service to support students, strength in numbers helped make it possible. IHE members are getting together to solve essentially the same problem of scale in other areas too.
Larger universities do tend to attempt to solve any approaching problems themselves – but there are areas, accommodation in a city region being one example, where collaboration is not just optimal but necessary. There are excellent examples of such work (the Nottingham Student Living Strategy is a favourite example) but it is piecemeal and ad hoc. There would, ideally, be sector level support for such initiatives – and there would be an opportunity to learn from the experiences of others.
Diamond suggested a sector level working group on strategic procurement, an idea whose time has perhaps come again. There was also a target – 30 per cent of non-pay spend to be collaborative by 2016. I’m pretty sure this didn’t happen, and I’m not even certain it was monitored.
Regulation and monitoring
The cost of regulation – financially, and in workload terms – is something that comes up every time you speak to university staff. In England, we’ve moved from a dependable cyclical set of engagements to an ad hoc approach that was supposed to lead to proportional regulation. However often OfS urges providers not to gold-plate quality assurance systems (as one prominent example) the fact remains that we need central management to be accountable for what goes on in lecture theatres, marketing, and course planning: central services now have to assure themselves that everything is happening as it should in preparation from the unexpected note from the regulator (one, in fact, of the many regulators that has an interest in the sector).
There are multiple regulatory and monitoring systems – they overlap, contradict each other, and require the submission of broadly similar information in different formats. We can say this with some certainty – it was a key finding (97 different collectors, 520 different returns) of the HEDIIP project (that led to Data Futures and the idea of a single central source of data), and I understand the former DfE Data Reduction Task Force reached similar conclusions.
The fact that the only interest in national coordination of Professional Statutory and Regulatory Bodies is around a handful of desks at the Quality Assurance Agency is a missed opportunity. The sector’s appetite for yet another rethink of quality assurance and data collection is limited at this point, but it could be the quickest way to realise (often significant) savings.
In 2011 there were also some concerns about the cost of freedom of information requests to the sector. These are still a factor, even though we don’t hear as much about them – and while we may be well disposed to the disclosure of information in the public interest, the reality of multiple weekly FOIs from vendors building sector intelligence for marketing purposes (just how much chilled filtered water do you use each week?) gets old very quickly.
Bonus content: the “efficiency exchange”
We were at the tail end of the “sharing best practice” boom in 2011. As a means of driving change it had a good run, so the proposal to establish an “efficiency exchange” for the sector came from a good place.
It was originally set up in 2013 with support from Universities UK, Jisc, HEFCE and the Leadership Foundation – it published a huge number of case studies and articles (including one from me!) and ran events and workshops.
In October 2017 the Efficiency Exchange moved to the Centre for Citizenship Enterprise and Governance (CCEG) at the University of Northampton, which was shortly afterwards spun out into an independent organisation. Under the leadership of Editor in Chief Olinga Ta’eed it pivoted sharply to the world of value-driven metrics and, eventually, cryptocurrency. The announcement of the spin out is probably the only time the Association of Research Managers and Administrators (ARMA) has promoted an initial coin offering (though I doubt that Seratio Tokens were a successful means to crowdfund the service, as it has languished mostly moribund since around 2020).
Ta’eed briefly worked with Birmingham City University as a visiting “professor of blockchain”, attempting to protect the nation against coronavirus using the raw power of distributed ledger technology. Sadly, this collaboration didn’t work out – but you can still follow Ta’eed’s remarkable career in coffee, crypto, the Chinese government, and David Cameron’s big society (all from a converted Welsh chapel) via the old Efficiency Exchange twitter account.
The original Efficiency Exchange content, showcasing best practice in efficient higher education and collated over eight years by a talented team of writers, remains.
