BUSINESS AND UNIVERSITIES

Written by Sir Richard Lambert, Chancellor of the University and former Director-General of the CBI

The relationship between universities and business has been subject to a significant amount of change over the past decade. Here Sir Richard Lambert, Chancellor of the University and former Director-General of the CBI, explains more about the shift in the relationship and what the future may hold. What do the next ten years hold? What developments will shape the future relationship between Warwick and businesses?

The ways in which universities and businesses work together have shifted significantly over the past decade. The radical changes that are now under way in the funding of England’s universities make it even more likely that the relationships between the two will shift and move even further in the coming decade – indeed, one only needs to look at the tentative launch for the New College of the Humanities (announced on 5 June 2011) to see these emblematic changes starting to take effect across the sector.

According to the Higher Education Funding Council for England, knowledge exchange activities of Higher Education Institutions generated nearly £2bn of income in 2007, a rise of roughly an eighth over a six-year period, and the numbers continue to grow. This increase has been fuelled by government funding, which is being maintained in cash terms and will amount to £600m over the next four years to support a wide range of knowledge exchange activities.

With the passage of time, collaborative arrangements between universities and companies are starting to become deeper and broader.

With the passage of time, collaborative arrangements between universities and companies are starting to become deeper and broader. Business/University collaboration can help to anticipate and respond to societal changes and help drive economic recovery by creating and supporting growth. Increasingly, private companies are actively seeking partnerships which enable them to extend their own research and development capabilities and enhance their own credentials in corporate and social responsibility. Business involvement in the university curriculum is also set to strengthen: a CBI task force report published in 2009 argued that universities must work with business in order to make teaching and learning applicable to what businesses need. Earlier this year, both Durham and Exeter announced that they would be launching a new course for students to undertake a six year programme with KPMG, leading to both a Durham/Exeter degree and a professional chartered accountancy qualification and Exeter will also collaborate with Flybe in the coming years to provide academic training and the new ‘Training Academy’. As university applicants consider more seriously than ever the ‘value’ of a university qualification, such evidence of innovative approaches to teaching and learning and of relevance to business and employability will be critical factors in their assessment of the ‘success’ of a particular institution.

Some collaborations are also shifting towards longer term strategic partnerships, such as the relationship now being developed between Warwick University and Jaguar Land Rover. Although small and medium sized companies still only account for about a quarter of university-business engagements, the numbers are picking up fast. What’s become much more obvious over the years is that successful universities are a vital component of a dynamic city, regional and national economy.

We are moving into a world where public funding for teaching will mainly go to support loans for students rather than being channelled directly to individual universities.

It seems clear that the new funding model for universities in England will require universities and businesses to work even more closely together in the future. We are moving into a world where public funding for teaching will mainly go to support loans for students rather than being channelled directly to individual universities. This raises all kinds of serious questions, of which one is about how young people will choose which course to study, and where.

The Government’s assumption that student choice will be determined by what it describes as the ‘employment return’ from their courses is unhelpful and misleading. To be sure, employability will be a significant factor that potential students take into consideration, but raising expectations of applicants is a dangerous business. There is no guarantee that just because a particular cohort of students from a particular course get good jobs at the end of their degrees, that subsequent cohorts will fall into similar posts – and vice versa. Getting a job, especially in the current climate, is a tough business. As a graduate job-hunter, you are expected to have a good degree from a good university, but to also have other ‘things’ to show for your time too – maybe some student volunteering, relevant work experience, interesting summer jobs or additional certificates in softer skills, not to mention networking and pro-activity. With more and more school-leavers opting to go to university, having a competitive edge in the job market is vital. Employability needs to be viewed in the wider context of a wider student experience.

The fact is that students will need to make informed decisions about which course/University is for them and to do this, they will have to have access to much higher quality information, advice and guidance than they do now. Universities need to work closely with careers advisors and teachers to ensure that accurate information is available to all applicants and that their perceptions of costs and repayments are not skewed by misinformation or hearsay.

Links between schools and universities will be of paramount importance in this brave new world, but so will businesses. In a demand-led system where government funding follows the student, employers are going to have to get much better at articulating their future skills needs and spelling out potential career prospects. Unless they are set on a particular vocation, most young people will not have a clue about the world that might be waiting for them in half a dozen years’ time – they will need all the help and guidance they can get.

Companies are going to have to do much more to work with young people while they are still at school to explain their career choices, and to set out what kind of career a particular course of study might lead to. Companies will also need to establish relationships with potential future employees at a much earlier stage in their university studies – supporting those they want most with bursaries or other forms of sponsorship, and providing work experience along the way.

In addition, they are going to have to get much better at articulating their future needs to the universities themselves. If they want a particular set of skills, companies may well find it makes sense to work with particular institutions to provide them - and to offer financial support where appropriate. The aforementioned example of Durham and Exeter working with KPMG is the first instance of what I am sure will be many similar collaborations.

Companies are going to have to do much more to work with young people while they are still at school to explain their career choices...

There are obvious risks in the Coalition Government’s attempts to give more and more room to market forces in the higher education system. One is that in their drive to support the study of science, technology, engineering and maths (which are seen as the key drivers of a knowledge-based economy), politicians run the risk of underestimating the importance of the social sciences and the humanities in a healthy economy, and the setting-up of the New College of the Humanities is in part, a response to this move.

Another is that the Government will be more willing to support applied research that is near to the market, rather than research that addresses the ‘big questions’. Getting the emphasis wrong in both of these areas would have damaging consequences for the economy as well as for society more generally. In his recently published book, For the University: Democracy and the Future of the Institution, Thomas Docherty describes the three main Faculties of the University (Arts and Humanities; Social Sciences and Science and Medicine) as ‘the good, the true and the beautiful’ and emphasises that for a rounded, healthy society, all three are required in equal measure. The Government’s evident leaning in one particular direction could have significant and damaging ramifications for the UK’s higher education system in the decades to come.

So, it is true to say that in the years ahead, universities themselves are going to have to show strong and purposeful leadership to navigate these times of change. They will need to work more closely with business in the interests both of their students and of their research activities – but not at the expense of their independence or their intellectual integrity. And there will be real opportunities ahead for those that get this balance right.

Sir Richard Lambert was appointed Chancellor of the University at a joint meeting of the University's Senate and Council on Wednesday 19th March. He took up the position on 1st August 2008 in succession to Warwick’s current Chancellor Sir Nick Scheele and was officially installed at a ceremony on 10th December 2008.

Sir Richard is the former Director-General of the CBI. He was knighted in the 2011 New Year Honours for service to business.