The adaptive university - still a place?

International S.T.E.P.S. Foundation
7th Olympiad of the Mind
Paris May 2005

1. Click or mortar

Peter Drucker has predicted that “Thirty years from now the big university campuses will be relics. Universities won’t survive. It’s as large a change as when we first got the printed book.”1

As evidence for his hypothesis Drucker notes that the cost of higher education has risen as fast as the cost of health care while lectures and classes can be delivered off campus at a fraction of the cost via satellite or two-way video. Today’s buildings, he asserts, are hopelessly unsuited and totally unneeded – the college will not survive as a residential institution.

James Duderstadt2 takes the analysis further. Technology allows one to unbundle components of educational delivery. He employs the Nike company as an illustrative analogy. Its expertise lies in marketing while manufacturing is outsourced to the cheapest supplier. One can approach educational delivery in a similar way. The ‘university’ promotes a brand and outsources course delivery – to conventional institutions, to departments of these universities or to individuals who generate course materials for web delivery and provide some local tutorial support. Provided one does not drive the suppliers to the wall, this reduces overheads and improves quality through selectivity.

The model is not unlike that which works for modern supermarkets. Corner stores cannot compete on price. Some suppliers are driven out of business but others come to take their place.

To this I would add that the fundamental power of the ‘university’ lies in its capacity to provide credentials. So long as the brand remains strong this translates readily into economic gain.

The threat to the traditional university is compounded by two further factors. The first is the fact that the skills required to advertise, package and coordinate the ‘net university’ are not those needed in the conventional collegium. Those with the current university mindset become the primary producers in the future economic chain. How much of ‘university’ remains – perhaps some form of self-governing kibbutz? The second issue is structural evolution of society. It is commonplace wisdom that regular job change, both movement from employer to employer and work re-definition within an existing position, is an increasing feature of our lives. No longer is education a front-loading for a stable career, rather the demands are for continuing upskilling and redevelopment. The study patterns of adult learners require flexible delivery modes including enterprise-based delivery. The new model we are discussing appears much better suited to these tasks.

If the Drucker hypothesis is valid what evidence do we have so far?

The most interesting success story is the University of Phoenix. This institution is part of the Apollo Group established in 1973 by John Sperling who correctly predicted that large numbers of adult learners would return to higher education in the new technology-based economy. In this particular sense the University of Phoenix was technology driven but not by a blind faith in online delivery. In fact, the University was founded in 1976 and commenced internet delivery in 1989. What characterised the development was an analysis of the needs of the target student market, convenient evening hours and accessible locations for tutorial support.

The Apollo Group more than doubled its total enrolments and revenues between 1999 and 2003. Degree enrolments at the University of Phoenix Online as at 31 August 2004 increased by roughly 50% to 118,900 as compared with 79,400 at 31 August 2003.3 The University offers complete degree programs in Business, Management, Technology, Education and Nursing. All aspects of the program including enrolment and administration are conducted online.

The venture has often been dismissed as competition for the Ivy League or even the broader group of research-intensive universities but such an attitude requires closer inspection. There are several anecdotes of the “those who came to scoff, remained to pray” variety, when academics from traditional institutions have examined the quality of the product. Moreover there is a suggestion (I have been unable to source hard data) that increasing costs of the conventional university experience have led to students making a conscious decision to trade down. While it is clear that the University of Phoenix does not compete in the prestige niche market, it can be argued that traditional universities provide effectively only for the upper segment of their own students. Those who are not among the high achievers may receive poorer value for money and subsidise the operation as a whole. One thinks of the economic challenge for an expensive specialist referral hospital which may need to cross-subsidise from more routine cases.

Such issues raise particular questions of government policy when applied to state-funded institutions. Typically the public university is heavily regulated and must provide educational opportunity over a broad spectrum of disciplines, profitable or not. Meanwhile governments may well encourage private providers, who can cherry-pick economically viable programs, to provide competitive zest.

That public institutions can, however, adapt to a changing environment is illustrated by SUNY (State University of New York) which has more that 413,000 students and 64 geographically distributed campuses. The online SUNY Learning Network began in 1995 with 8 courses. Today there are 4,300 courses with an enrolment of 86,510.4

In my own university we developed a problem-based medical program with an online core because of our geographically spread teaching hospitals. We have now licensed the materials to other universities in several countries including our own. That could perhaps be described as serendipitous commercialisation but it is preferable to business loss!

Not all adaptive ventures have been successful. The UK eUniversity was launched in 2000 at the height of the dotcom boom with the goal of attracting large numbers of students worldwide to study British degrees online. The UK government allocated GBP £62 million to the project between 2001 and 2004 but there were only 900 students by November 2003 and this was accompanied by a lack of private investment. The venture was closed at an estimated net cost to the British taxpayer of £50 million.5

Universitas 21, a consortium of prestigious universities from major countries, has been struggling with the viability of internet delivery of programs in that segment of the market consistent with their brand image. Although the venture has the backing and expertise of the Thomson Group, profitability appears elusive. Amongst the questions raised by this venture the most obvious is whether it is simply ahead of its time or whether this is a case of a product seeking a market. It is entirely consistent with Drucker’s doom-laden prediction that bricks and mortar are not the only features of the traditional university which are obsolescent.

Let me summarise this section by saying there is strong evidence that the modern university can no longer afford to be constrained by its geographical boundaries. Its physical place is less significant. There are hints that its traditional place in our minds is also threatened. However I have considered program delivery only. Does our response to these questions of ‘place’ change when we look at the other aspects of the university as we know it? Before considering these matters we should spend some moments considering ‘place’ itself.

2. Knowing our place

“Place is nothing, does not exist, has no force.”6

These are close to the words of a business man who had swallowed the Drucker hypothesis whole and told me recently that I am a Luddite for building a new Law School. Indeed he told me that he had read a review of a book, but forgotten the title, which showed that the internet would replace universities like mine.

In truth the quoted statement is from the mid 17th Century and comes from the writing of William Gilbert, physician to Elizabeth I. I like to think of it as an antidote to rash assumptions that we face a totally new paradigm because information technology has confused global and local, that we are the first to face the collapse of the comforting cradle of place and only the net is real.

Any antidote in this matter is useful and Gilbert’s words, as an isolated motto, could be used that way. Honesty compels me to explain briefly what he really meant, because he was expressing a succinct dismissal of Aristotle’s physics.

For Aristotle ‘topos’ i.e., ‘place’ has priority in physics as “the inner surface of the innermost unmoved container of a body.”7 As Casey notes “place is actively circumambient rather than merely receptive.”8 Moreover, “all the elemental substances (earth, air, fire and water) have a natural tendency to move towards their own special places, or to rest in them when they are there.”9

Aristotle’s work became part of the official curriculum of the University of Paris in the mid 13th Century but his ‘container’ theory in conjunction with the nest of celestial spheres – especially the limiting nature of the outer sphere – restricted the omnipotence of God. Accordingly the Bishop of Paris in 1277, after consultation with the Sorbonne faculty, issued 219 condemnations of doctrines that limited the power of God.

Over the next 300 years cosmology developed in such a way that ‘place’ in Aristotle’s sense was replaced by ‘space’. Giordano Bruno expressed himself lyrically,
“Henceforth I spread confident wings to space;
I fear no barrier of crystal or of glass;
I cleave the heavens and soar to the infinite.”10

Much later Gilbert, who was conducting pioneering work on electricity and magnetism, is matter of fact and technical. ‘Topos’ the container does not exist and there is no force moving things to their natural topoi. Thus Gilbert was quite simply correct. "Place is nothing, does not exist, has no force."

Why then do we tend to misread his words? Our reaction to his text, taken in isolation, is, I suspect, something like “Steady on, old chap. You are being rather severe.” We accept that globalisation has changed for ever our sense of place, but even if meaning is different we still seek the comfort of being in place or at least in multiple places.

Towards the end of his philosophical history of place, Casey lists modern authors who “have succeeded in fashioning a fresh face for place”. He says “each tries to find place at work, part of something ongoing and dynamic, ingredient in something else: in the course of history (Braudel, Foucault), in the natural world (Berry, Snyder), in the political realm (Nancy, Lefebvre), in gender relations and sexual difference (Irigaray), in the productions of poetic imagination (Bachelard, Otto), in geographic experience and reality (Foucault, Tuan, Soja, Ralph, Entrekin), in the sociology of the polis and the city (Benjamin, Arendt, Walter), in nomadism (Deleuze, Guattari), in architecture (Derrida, Eisenman, Tschumi), in religion (Irigaray, Nancy).”11

I have set out on a preliminary exploration of place ingredient in modern universities. Drucker’s severe hypothesis denies a future for place as we have come to understand it. I will explore another hypothesis based on the work of Richard Florida, one which is much more congenial and optimistic for those who currently inhabit the academy. Before that, however, let us visit some topics of contemporary university geography.

3. Regions and networks

Judge Joannes de Gualengis in 1442 presented a petition to Prince Leonello for the reformation and substantial re-establishment of a university in Ferrara:
“For, to begin with its utility, strangers will flock hither from various remote regions, and many scholars will stay here, live upon our bread and wine, and purchase of us clothing and other necessities for human existence, will leave their money in the city, and not depart hence without great gain to all of us. Moreover, our citizens who go elsewhere to acquire an education and take their money there, will have an academy at home where they can learn without expense, and our money will not fly away.”12

In today’s Australia the same mercantile spirit is alive and well. It has led to a curious phenomenon wherein the major metropolitan universities have become invisible but the ‘place’ of regional institutions has strong political force. It is easily understood that the physical presence of a university in a rural area provides employment and facilities, sporting and cultural, which can be used by the local community. It is argued that policy for the distribution of research infrastructure should take account of ‘impact’, where impact measures support and advice to local business rather than the influence of ideas on the world at large. In each federal election campaign one expects new campus developments, the creation of medical schools and the allocation of special project monies to universities which serve particular regions. There is widespread acknowledgement that public subsidy should safeguard the ‘place’ of regional institutions while the big city universities face the challenge identified by Drucker and generate efficiency gains for the sector as a whole. This is rational, provided that it is understood that the latter institutions are fundamental to the national economy and have a powerful multiplier effect on the city communities where they are located.

Because this understanding is weak, the leading universities in major cities have begun to redefine their ‘place’ in international terms. My own university now has over 3,000 students from mainland China alone. Denied strengthening of our medical school through places for Australian students, we are contracting with foreign governments to provide training in the health sciences in Sydney for their citizens. More generally, overseas residents now constitute 19% of our 47,000 students and that percentage has been regularly climbing.

The fact that ‘place’ for research-intensive universities now has a trans-national character pleases both me and the airlines. It has long been the case that scholars identify first with their discipline and do so on an international basis. This has meant that their sense of ‘place’ is global whereas that of their university may have been ‘local’. Now universities are establishing institutional networks which facilitate academic interchange at all levels.

Currently I am President of one such network, Academic Consortium 21 (AC21), which originated in Japan and has 25 university members from 12 countries in Europe, United States, Asia and Australasia. The stated goal is to provide an “international network for the purpose of encouraging the further advancement of global cooperation for the benefit of higher education, contributing to world and regional society and developing a ‘University-Architect of the New Century’ through

1. promoting research through collaboration
2. enriching education through cooperation
3. contributing to industry and community in world and regional society.”13

I serve also on the Steering Committee of the Association of Pacific Rim Universities (APRU) which includes the major research universities of the US West Coast, leading universities from many Asian countries and Australia and from cities as far apart as Santiago and Vladivostok. Geographical ‘place’ was a factor in the founding of this organisation which seeks to remind all APEC countries that research universities form a key part of the infrastructure for economic and social development. In particular it is not only mature economies which benefit from investing in research-based higher education, especially when a strong local presence guarantees admission to a strong network.

By its very existence APRU facilitates many cooperative ventures. There are regular rencontres for postgraduate students, and for junior faculty, meetings of information technology managers from the participating institutions and specific projects which share and benchmark theory and practice across the group. Recent examples concern comparative evaluation of techniques for research commercialisation and technology transfer and protocols for containing communicable diseases such as bird-flu or SARS. The associated APRUNet “aims to assist in the development of advanced internet capabilities among APRU universities and APEC economies in collaboration with strategic and commercial partners.”14

Both organisations are in evolutionary development and are much more than umbrellas of cooperative MoU’s. While respecting the autonomy of their members, they are defining a new dimension of ‘place’.

4. Creative hubs and research diffusion

As promised I will now offer a hypothesis which predicts that research-intensive universities will survive and prosper in the new global economy. Let us hear first from Henry Chesbrough,
“The rise in excellence in university scientific research and the increasingly diffuse distribution of that research means that the knowledge monopolies built by the centralised R&D organisations of the twentieth century have ended. Knowledge is far more widely distributed today, when compared to, say, the 1970’s. And this far greater diffusion of knowledge changes the viability and desirability of a Closed Innovation approach to accessing and taking new ideas to market”15

Let us set this beside some words from Richard Florida,
“The potential of the university as an engine for regional economic development has captured the fancy of business leaders, policy makers and academics – and it has led them astray. A theory of sorts has been handed down that assumes a linear pathway from university research to commercial innovation to an ever-expanding network of newly formed companies. This is a naïve and mechanistic view of the university’s contribution to economic development. While the university is a key institution of the Creative Economy what’s not so widely understood is the multifaceted role that it plays.”16

If Florida is right then Joannes de Gualengis, who appeared so surprisingly contemporary, is old-fashioned after all. Florida, who is professor of economic development at Carnegie-Mellon University, argues that, in an information age, it is creative people who fuel the economy and enhance the quality of life for all. He believes that ‘the growth of technological innovation and creative content is increasingly becoming the driving force of economic growth.’ Cities and regions that are economically and socially successful are centres of creativity powered by a special kind of human infrastructure.

In order to apply statistical analysis to confirm his thesis, Florida has developed a “Creativity Index” which is based on four components. These are the Innovation Index, the High-Tech Index, the Gay Index and the Creative Class Index. The Innovation Index is a measure of patented innovations per capita. The High-Tech Index, developed by the Milken Institute, takes account of high-tech output as a percentage of national high-tech output and also the proportion of a region’s total economic output coming from high-tech industries compared with the corresponding national proportion. The Gay Index is the ratio of the percentage of gay people in a region to the national percentage. (This can be represented as an estimate of tolerance and low entry barriers to human capital. Gary Gates, who developed the index with economist collaborators, has used the phrase ‘canaries of the Creative Age’) The Creative Class Index takes the percentage of those having ‘creative’ occupations in the workforce. Florida lists super-creative occupations – computer and mathematical, architecture and engineering, life, physical and social science, education, training and library and arts, design, entertainment, sports and media – and creative professionals – management, business and financial, legal, healthcare and technical, high-end sales and sales management. The Creative Class, as he defines it, made up some 30% of the US workforce in 1999 as compared with 10% from the turn of the 20th Century until 1950.

There are many difficulties with both definitions and data but surprisingly good statistically significant correlations are produced.

I will return, in a moment, to the relevance of Florida’s research to universities. It is interesting first to consider some recent statistics17 which calculate rankings based on a Global Creative Class Index. Florida argues that the United States is losing much of its creative appeal and is no longer an attractor of global talent. In a global ranking of the percentage of workers in the Creative Class, he now places the US in 11th place behind Ireland, first, Australia, third, and Canada, eighth. He calls for a heavy investment in education and research to ensure growth of the creative infrastructure.

In his 2002 book, The Rise of the Creative Class, Florida states that “the presence of a major research university is a huge advantage in the Creative Economy. . . Many of the places that score high on my Creativity Index are home to major research universities. . . In my view, the presence of a major research university is a basic infrastructure component of the Creative Economy.”

As I have noted at the beginning of this section, he sees the influence of a university as multi-faceted. He accepts the conventional wisdom concerning technology, so that universities conduct cutting edge research and generate spin-offs. He also sees them as more general attractors of talent. This magnetic power creates an environment in which companies “locate nearby in a cycle of self-reinforcing growth.” He emphasises also tolerance, noting that an open and progressive group of people serves to attract and retain other members of the Creative Class. His summary is that “in doing these things, universities help to establish the broader quality of place of the communities in which they are located.” [My italics]

Let us turn now to Henry Chesbrough who argues that an old model of Closed Innovation is being replaced by a new model of Open Innovation. I cannot attempt to do justice to his thesis in a few words, but let me use (and unintentionally abuse) some of his ideas as they relate to our theme.

Major business enterprises were once accustomed to developing new technology in house and in secret by means of large R&D operations. It became increasingly clear that a linear model was inefficient and that adaptability and good business models were important keys to success. A degree of humility in accepting that not all the good ideas are one’s own can generate economic reward. You should profit from others’ use of your intellectual property and should buy the intellectual property of others whenever it advances your business model.

If everyone embraces this paradigm, there is a potential problem over the generation of new research and technological innovation. The company needs some internal R&D but mainly to keep abreast of the latest developments. It is a poor investment to have extensive research laboratories of one’s own, even those of the highest calibre, capable of winning Nobel Prizes like Bell Laboratories.

In fact the Open Innovation model places much more reliance on the universities, not as isolated entities attempting to develop their own research to commercial outcomes, but as part of a widely diffused network of research development. A company may well find it profitable to invest in a university’s research – not to commission a particular project but to forge the relationship that facilitates tapping into the world-wide web of scientific developments.

The Open Innovation model gives a rationale for governments to ensure that there are strong research universities and for business to do the same.

Thus I have been able to present a counter-hypothesis to Drucker viz. that structural aspects of the new global economy ensure the survival of research universities. Apart from being bullish about the sector, what do the theories I have extracted from Chesbrough and Florida have in common? The latter redefines place but in a way which is fundamentally regional (remember that a big city is a region in this sense also!) whereas the former places universities as part of a globally diffused network.

I believe that we can reconcile these positions by means of a 21st Century rejection of a lingering trace of Aristotle’s topos. Both Florida and Chesbrough are tearing down the walls of the ivory tower, rupturing the vessel that might define place. For Florida, it is the research university re-placed as an interactive part of the regional creative community. For Chesbrough, it is the research university re-placed as an interactive part of the global creative community. Both require a nucleus in space, a geographical location but the meaning of ‘place’ has been changed for ever.

The university’s adapted place is defined through outreach.

In accordance with the Olympiad of the Mind request for each paper to provide two propositions, I offer

1. Resisting the pressures of commodification and massification, we call on governments and business to invest in research universities to provide creative infrastructure for the new world economy
2. We call on universities to redefine their place through active community outreach.

Gavin Brown
Vice-Chancellor and Principal
The University of Sydney

Notes

1. Quoted in Robert Lenzner and Stephen S. Johnson Seeing things as they really are Forbes Magazine (3/10/97)
2. JJ Duderstadt in Dancing with the Devil, Richard N Katz and Associates, Jossey-Bass San Francisco 1999
3. Apollo Group Inc. Reports Fiscal 2004 Fourth Quarter and Year End Results
4. SUNY Fast Facts www.suny.edu
5. D Macleod, £50m bill for failed e-university (Guardian 23/6/04)
6. W Gilbert De Mundo Nostro Sublunari Philosophia Nova Amsterdam 1651 Bk2, ch 8 quoted in Casey (below) p135. I am grateful to Professor John Gillies of the University of Essex for bringing Gilbert’s words to my attention.
7. WD Ross Aristotle’s Physics Oxford OUP 1936 Physics 212a 20-21 p56
8. ES Casey The Fate of Place University of California Press 1997 p55
9. Aristotle Physics 211a Translated P H Wicksteed & F M Cornford (Loeb Classical Library, Harvard University Press Cambridge 1929 Vol 1 p303
   quoted in Concepts of Space Max Jammer Harvard University Press 1954, Dover reprint 1993 p18
10. G Bruno On The Infinite Universe & Worlds Translated by Dorothea Waley Singer in Giordano Bruno (Schumars, NY 1950) p251 [Max Jammer p88]
11. ES Casey The Fate of Place University of California Press 1997 p286
12. University Records and Life in the Middle Ages Lynn Thorndike Columbia University Press NY 1944 p333
13. Academic Consortium 21 Articles www.ac21.org
14. Association of Pacific Rim Universities www.apru.org
15. H Chesbrough Open Innovation Harvard Business School Press 2003
16. R Florida The Rise of the Creative Class Basic Books NY 2002
17. R Florida America’s Learning Creativity Crisis Harvard Business Review Oct 2004