Midlands Conference 2015: Strategic responses presentation - Nick Allen

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Strategic Challenges in a
Competitive Environment
David Bryan, De Montfort University
Nick Allen, The University of Northampton
AUA Midlands Regional Conference
Wednesday 14 January 2015

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Aims of Today:
• Reflect on the keynote speaker’s presentation;
• Consider how universities are responding to existing
challenges;
• Reflect on your own institution’s strategies, strategic
responses and impacts.

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But first, a bit about us……

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Strategy 101 – The Basics
Why
How
What
Ted Talks
How great leaders inspire action
https://www.ted.com/talks/simon_sinek_how_great_lea
ders_inspire_action

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The benefit of strategic planning
• NPO – the benefit of strategic planning
• Kaplan and Norton – Office of Strategy
Management
• Strategic flexibility utilizing a strategic
framework

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Strategic Planning at DMU
• Theme based strategy (currently)
– Annual integrated planning exercise
– Quarterly review points
– Performance monitoring to Faculty / School
– Supported by central planning team; and
dedicated planning partners in each Faculty.

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Strategic Planning at Northampton
• Single strategy – Raising the Bar
– Underpinning Operational Plans;
– Annual budget and Unit (academic and
professional services) planning process;
– Monitored through key performance indicators
at institutional and School levels.

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Competitive Markets
• Is Higher Education a competitive
market?
– Ability to charge
• Profit
• Limited places / rivalry
• Excludability i.e. no free provision
– Consumers can reject provision
http://economicsonline.co.uk/Competitive_markets/Competitive_mark
ets.html
Accessed 05/01/2015 at 10:53

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Challenge 1 – Supply and Demand
• Can we grow the UK Higher Education market?
– Full time first degree numbers increased by 29% between 2003-
04 and 2011-12, but remained steady in 2012-13 (Student
Number Control)
– Other undergraduates have declined (44% between 2009-10
and 2012-13)
– Postgraduate taught numbers increased 19% from 2007-08 to
2011-12, but have declined 12% in 2012-13.
– Full time postgraduate research numbers increased by 41%
between 2003-04 and 2012-13

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Challenge 1 – Supply and Demand (2)
• Can we grow the UK Higher Education market?
– Has £9000 become the defining factor
• Part time and Other undergraduate fees
• Between 2007-08 and 2012-13. HEIs lost 45% of Other
undergraduate students; FEIs gained 39%.
• For the 223K other undergraduates lost, HEIs gained 222K
degree students.
– Alternative providers
• 29,200 tuition loans issued in 2012-13, 9,800 tuition loans
issued in 2011-12

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Competitive Markets
• Is Higher Education a competitive market?
– Not yet.
– Supplier behaviour is being set by policy, not market
demand.
– However competition is building – 300% growth(?) in
Alternative providers
– What markets should we be in?
http://economicsonline.co.uk/Competitive_markets/Competitive_mark
ets.html
Accessed 05/01/2015 at 10:53

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Challenge 2 – Students as Consumers
• Perception over the relative value of the £9000 tuition fee
– Can a student define a quality product
– Outcomes?
• The rewards of a degree
– £250K boost for females (over lifetime)
– £165K boost for males (over lifetime)
– Higher reward for good honours
• The rewards of Masters (PGT)
– £200K additional over 40 years

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Challenge 2 – Students as Consumers (2)
• Perception over the relative value of the £9000 tuition fee
– Other outcomes
• Graduates are more likely
– to report better health
– to vote / volunteer / engage positively in society
– to not commit a crime
• Or just a more demanding market
– 30-34 year olds with a HE qualification, 51.1%(2013)
and 35.6% (2003)

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Challenge 2 – Students as Consumers (3)
• Perception over the relative value of the £9000 tuition fee
– However the previous outcomes aren’t HEI specific
– What differentiates HEIs?
• What are the tangible immediate benefits and qualities a
student can compare between HEIs?
• League tables - 2007 research showed league tables have no
impact on domestic recruitment.
• NSS

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Competitive Markets
• Is Higher Education a competitive market?
– Do we have informed consumers?
• At a sector level given the benefit of PGT study
• At an institution level
– Do we know what students want?

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Over to you…..
• What do you think are the challenges?
• Are we in a competitive market situation?

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Strategic Responses
• Deliberate increases or decreases in
student population;
• Investments in student experience (staff);
• Campus redevelopments;

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Strategic Responses at DMU
• Investment in student employability
– FrontRunners, Graduate Champions
• Investment in student experience
– #DMUGlobal
– Mile2
• Theme based focus
– Central projects office

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Impact at DMU
• Destination of leavers from HE
– Employability Performance Indicator
• 87.4% (2011-12) to 93.8% (2012-13) FT degree
• Reduced number of corporate projects
– Moving effort to focus on key strategic
projects

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Strategic Responses at Northampton

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Impact at Northampton
• Improved student satisfaction
– 2011: 80%; 2014: 89%
• Top 50 UK University Ranking (Guardian)
• Improved reputation

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Over to you…..
• In groups, what have been your
institution’s strategic responses;
• What has been the impact?
(Be prepared to report back to the group)

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Future Plans at DMU
Fletcher redevelopment

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Future Plans at Northampton

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What are your plans for the future?

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The Future of the Sector (in our view)
• More market driven and student centric
• Fees won’t increase leading to real term
reductions
• Demand will become increasingly unpredictable
• Removing cap will increase competition
• High fixed costs
• International Competition
• Winners and Losers

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More information at www.aua.ac.uk
Email: aua@aua.ac.uk
Call: 0161 275 2063