By Elaine H. Hairston
Elaine H. Hairston is chancellor of the Ohio Board of Regents,
and president-elect of State Higher Education Executive Officers.
This article was adapted from her remarks at the Retreat of the Washington
Secretariat in Washington, D.C. on November 6, 1995.
As an undergraduate English major, I often found myself on a literary picaresque journey following the adventures of heroes in which they encountered all sorts of interesting people and places. Journeys which, despite trials and tribulations, had as their reward, knowledge and, sometimes, even wisdom.
While it has not been in the pastoral setting of old England or Spain, my journey over the last several months has taken me to conversations with leaders of major businesses and industries, to campuses and emerging educational delivery entities which are experimenting with ways to position higher education for a viable future, and to literature on organizational changes which suggest a worldview related to scientific discovery.
I began with a simple question: "What kinds of strategies have organizations outside the higher education arena used to deal with a constrained resource environment while providing competitively priced services or products and maintaining high quality?" I wanted to hear their successes and their failures and to see if any of these strategies might be useful in higher education, for, in my view, this is the very challenge that we face.
We all know that we are in a time of significant change. In 1993, higher education saw its revenues drop nationally, it heard a litany of complaints about rising costs and pointed criticism about inefficiencies in how we go about what we do.
Educating the nation and developing its human resources is becoming ever more integral to the capacity of this nation to succeed in the future. Having a higher education is no longer a luxury, it is a necessity--but a necessity that is harder by the day for people to pay for.
Our political leaders are not unaware of these issues. Under significant pressure from all other quarters, they respond by pressing for more effectiveness and more efficiency in what we do. They seek additional productivity, focusing on faculty workload, administrative staffing and program duplication. They sometimes indirectly--and more and more often directly--question tenure and its ramifications.
And so, while our pressures are not yet those directly of the marketplace, such as those faced by leaders in business and industry, they are real and we know they will not yield easily. My sense is that we have seen nothing yet compared to what we will face in the coming decade or two. The technological revolution coupled with the continuing economic pressures upon us all will combine to change in significant and structural ways what we do and how we do it--or we will be left behind.
Corporate Change
During the 1980s and early 1990s, leading businesses in the U.S. underwent a metamorphosis. Sometimes triggered by growing global competition, sometimes by a weakened balance sheet occasioned by obsolescent products or services, sometimes by prescient leaders who saw that the world was changing around them, these companies used a variety of strategies to recreate themselves and how they will do business in the future. Here are a few examples of how they are managing change.
The Timken Company
The chairman and the president of The Timken Company both emphasized that they were moved to action by the recognition that the world and its expectations were changing and that the old formula for success wasn't working anymore. It was a problem of "waning competitiveness" which came sharply into focus in the mid-1980s. This crisis was both a threat to the company and to the future of its employees. To meet it, company leaders made a commitment to substantial, not incremental, change.
In their view, real change is not just downsizing. In fact, this company with generations of loyal employees turned in major part to other methods, primarily the stripping out of the bad parts of bureaucracy. Their focus was on changing the institution itself, not cost-cutting.
Total quality management ideas permeated their process: doing it right the first time, speed (bureaucracy is the opposite of speed in their view), de-layering the organization and empowering individual employees, shedding marginal activities, consolidating and aligning based on priorities.
The results? A new Timken Company which today outperforms all competitors on market value, dividend flow and price of security; 238 customer recognition awards in 1994; growth in market share, and an organization that operates on continuous improvement.
B.F. Goodrich
In 1980, B.F. Goodrich, once one of the largest producers of tires in the world, gradually began to recognize that there were growing problems facing it which could be fatal if not addressed. Beginning with a series of small steps, such as changing the nature of the product line, they sought to make these areas more attractive and ultimately saleable. At the same time, they identified their company strengths, and sought to de-centralize the management of them.
In sum, their whole mode of operating today is more tense, rapid, more productive, and their technological and other systems are better. In 1995, 80 percent of the businesses that had comprised B.F. Goodrich in 1980 were gone, replaced with growth in areas of increased strength, and acquisition of more aligned business interests. Sales had tripled from 1980 to 1995. It was, in Chairman John Ong's words, a "transformation."
Rubbermaid
Wolfgang Schmitt, CEO of Rubbermaid Corporation--which is often cited by Fortune Magazine as one of America's most innovative companies--once remarked that you "cannot reduce yourself to prosperity." Most college and university presidents know that only too well.
Rubbermaid pays detailed attention to its "total value chain," rating itself on every step of its process and focusing sharply on needed improvements. They use clear information systems to ensure their work, and pay attention to the whole picture. They also point out that a value chain is not linear; interaction and reaction influences every thing, everywhere.
Threading its way through all my conversations with corporate leaders was the integral nature of technological advancement in their pursuit of success. In the manufacturing sector, one can see easily how such advancement would be a sine qua non for remaining competitive. But, even in the service sector, such as the banking industry, the shift to technology is rapid and permanent.
What lessons are there for us in the nature of corporate change? The primary one is that colleges and universities need to analyze the processes which underlie what they do, both academically and administratively, seeking to find their qualitative weak links and move vigorously to improve them. We have all known institutions that have done this kind of work, but our problem is that we have not developed the mechanisms to imbed continuing improvement as a way of life.
A second important lesson lies in achieving a common purpose. While businesses and other organizations will stress "alignment" of organizational purpose and redouble their efforts through communication, incentives and recognition to achieve their goals, higher education's traditional structures are not nimble enough to reach common purpose easily. From the boundaries between departments to the profound attention paid to disciplinary expectation and affirmation, sometimes at the cost of improvement to instruction itself, we often find non-alignment between vision and reality. alignment of purpose will require thinking beyond departmental and disciplinary lines to be responsive in greater degree to the needs of the students and the campus.
An additional lesson lies in the concept of transformation itself. The dilemma for higher education is that it must cut costs while maintaining quality. To meet this challenge, it will have to change how it educates students. That transformation will be driven by the need to increase both value and productivity on all levels, by all members of the campus community. It will require innovative thinking about how students can best learn, how faculty can best guide that learning, and how administrators can facilitate the most beneficial environment. These matters will move from peripheral concerns to central issues in the successfully transformed campus.
Perhaps the most important lesson is that business and industrial leaders in America believe that higher education is in the same position business was in 15 years ago and that we have not fully grasped the monumental change that will envelop us as it enveloped them. While the moment is not likely to be triggered by huge cost-cutting from overseas, the continued weakness in state subsidies, decline in federal grants, loss of student financial aid, and sometimes prohibitively high tuition will combine with the skyrocketing growth in technological capabilities in education to the point of either serving to shift the paradigm or catching campuses in the tidal wave.
Major experimentation can be found in emerging educational entities: multi-state compacts, proprietary institutions and entrepreneurial marriages of cable companies and academic programs. In 1995, I visited the Open Learning Agency in Burnaby, British Columbia. It is a degree-granting entity, part of the educational system of this geographically vast province, which began by providing correspondence courses to a far-flung population. This fall, it moved into the Internet, and will be providing academic coursework using all of its capacities.
Premier institutions of higher education, particularly at the graduate level, seek to maximize their return on faculty investment, and they cast their gaze upon the possibilities provided by technology. What is to prevent, for example, MIT and Cal Tech (first and second in the nation in aeronautical engineering at the doctoral level) from deciding that together they can, via video and the Internet, coupled with cooperative agreements with businesses such as General Electric, meet all their educational needs for aeronautical engineers? They could have affiliated faculty and laboratories nationwide, and might use the most recognized and expert faculty in each subject area.
The Chinese symbol for change means both opportunity and danger. Campuses that find ways to utilize technology both to improve academic and administrative productivity and, most importantly, student learning, will reap rewards, and those which do not will find themselves in a posture of growing risk. But, what kinds of organizations can stimulate and incorporate change, leading to their success in the 21st Century?
The High-Performance Organization
Margaret Wheatley, author of "Leadership and the New Science," has gone far beyond my basic musings about the nature of organizational change. She comments:
"It is interesting to note just how Newtonian most organizations are. The machine imagery was captured by organizations in an emphasis on structure and partsÉPage after page of organizational charts depict the working of the machine: the number of pieces, what fits where, who the big pieces areÉUntil recently, we really believed that we could study the parts, no matter how many of them there were, to arrive at knowledge of the whole." She goes on to say, "A world based on machine images is a world filled with boundaries."
Quantum theory suggests that change can and does happen in giant leaps, which are often not predictable, and most often is based on relationships. Chaos theory paradoxically suggests order is to be found in disorder. Wheatley's descriptions of systems are organic rather than mechanistic. It is a webby worldview and it has become mine.
For tomorrow's successful college and university, our challenge will be to stimulate flexible structures that facilitate relationships and their lifeblood, information flow. Is it coincidental that the Internet is such a structure? Is it happenstance that the "Web" features just this kind of structure?
In the 21st century, charts give way to webs. Predictability succumbs to connections. Machine images dissolve to organic views. Bureaucracy surrenders to simple, fluid processes. We are in a time of change and we are uncomfortable with it. But it is that very discomfort which will lead us to become what we must, for the good of those we serve as well as for the institutions we steward. u