Competitive Intelligence: Significance in Higher Education

By Susan E. Barrett, MLA, MSEd, EdD

Market influences and competition for rev- cated that “even university presidents were cho- enue are evident throughout the higher education sen for their ability to raise money and their close landscape (Newman, Couturier, and Scurry, ties to the corporate sector” (Washburn, 2005, p. 2004). Writing in 2004, Newman, Couturier, and 204). Scurry noted that competition within the Higher Slaughter and Rhoades (2004) expanded be- Education sector, though evident for the past sev- yond Washburn’s concept of the student as con- eral decades on a minimal scale, had long re- sumer relative to the university as marketer. In mained basically benign. Today, however, com- this type of environment, concepts of “profit cen- petition is serious and powerful. Universities that ters” and “academic capitalism” were introduced. were accustomed to an established place in their Universities were now using mechanisms such as segment of higher education and within their geo- marketplace analysis, managerial capacity, part- graphic area now finding that “the competition time faculty, copyright, and information technol- crossed both these boundaries” (p. 3). Seeking ogy to create profit centers that linked them to a sources of revenue has become a constant pres- network of actors that included both other uni- sure, and identifying opportunities for growth and versities and corporations. The authors stressed: strategic positioning is now essential to survival. “The present situation was not links but spheres Washburn (2005) reinforced this aspect of of interactivity that had no boundaries. Issues the university as a constant seeker of revenue and such as commercialization were discussed as they therefore acted more business-like than academic. relate[d] to profitability” (p. 11). The authors fur- She noted that, through market pursuits, univer- ther noted an internal infrastructure of “profit ori- sity administrators had adopted the language of ented activities as points of reorganization (and business. Students were referred to as customers, new investment) by higher education to develop and courses and ideas as products. The business their own capacity, (and to hire new types of pro- attitudes of higher education adopted from in- fessionals) to identify and market products cre- dustry were carried forward by educational ad- ated by faculty who developed commercial-able ministrators who had, she noted, been recruited products outside of (though connected to) con- from industry specifically for their business acu- ventional academic structures” (Slaughter and men, not their educational experience. She indi- Rhoades, 2004, p. 11).

Susan E. Barrett, MLA, MSEd, EdD, is vice president of corporate relations and marketplace analysis at the University of the Sciences. For 25 years she has helped universities develop best practices in , competitive intelligence, advancement, board development, and marketplace analysis. Dr. Barrett holds advanced degrees in academic leadership and administration from the University of Pennsylvania and Widener University. She may be contacted at [email protected].

26 World Future Review August-September 2010 Initial activities related to academic capital- generation for higher education was now taking ism were responses to fiscal shortfalls. In higher place at the department level through entrepre- education, fiscal crises created a climate that em- neurial activity. They noted, that in some cases, phasized the need for the development of new departments had raised revenue by serving as em- sources of revenue above and beyond the ever ployment agencies “tapping into employers’ need ­relied-upon tuition increases. The authors em- for students to generate funds” (Slaughter and phasized institutions’ continued need to reinforce Rhoades, 2004, p.193). The authors noted that revenue streams externally (Slaughter and corporations, unlike the academy, often are un- Rhoades, 2004). able to make long-term research commitments These responses to fiscal shortfalls had coin- because of their relatively short-term—two- to cided with what the authors termed the “new five-year—planning orientation. As a solution to economy” (Slaughter and Rhoades, 2004, p.14). this limited timeline, Slaughter and Rhoades iden- They noted that higher education had been re- tified and indicated that select universities were sponsive to external market forces throughout responding by offering opportunities such as a history. The authors indicated that in the last corporate partners program in which they charged quarter of the nineteenth-century, “universities a fee to identify and recommend top-performing integrated with the industrial economy, shifting students. from a focus on theology, moral philosophy, and Slaughter and Rhoades (2004) mentioned education of gentlemen, overseen by the clergy, that we should not be surprised at the academy’s to science-based disciplines ranging from chem- related concern with this new revenue . istry and engineering to the social sciences” However, they stated that the new knowledge/ (p.14). However, at the turn of the twenty-first information economy was a reality, and that, while century, the authors stressed, higher education tuition revenues continued to represent the fast- “[could] not ignore corporations because knowl- est-growing share of annual operating budgets, edge was not easily separable from the new econ- many departments in higher education were in- omy. In the information society, knowledge was creasingly offering educational services aimed at the raw material to be converted into products, generating external revenues. process, or service” (p.15). Regardless of the traditional model of the The authors claimed that universities were academy, “American higher education was being now viewed as a major source of “alienable knowl- transformed by both the power and the ethic of edge,” and “were in the process of establishing new the marketplace,” according to Kirp (2003, p.4). relations with the global economy. Autonomy, the He noted that the American university had been preferred but perhaps always fictive position of busily reinventing itself in response to intensified universities with capital, was now less a possibil- competitive pressures. “Entrepreneurial ambition, ity because of this positioning” (Slaughter and which used to be regarded in academe as a nec- Rhoades, 2004, p.15). The authors stated that uni- essary evil, ha[d] become a virtue” (Kirp, p.4). versities were participating in redefining and re- Kirp stressed that priorities in higher educa- drawing the boundaries of the private sector. As tion were not necessarily determined by the in- such, universities favored boundaries that allowed stitution but by external constituencies such as them to participate in a varied array of activity students, donors, corporations, and politicians. intended to generate external revenues. He identified new business-type thinking within Additionally, Slaughter and Rhoades (2004) higher education in which departments were noted that a great deal of cost-center and revenue viewed as “revenue centers” (Kirp, 2003, p.4). He

World Future Review August-September 2010 27 highlighted the Atlantic Monthly March 2002 to increase revenues. article that examined multimillion-dollar deals The argument remains concerning higher between industry and higher education. Kirp education’s resistance to change and the need for stated that “disinterested inquiry” was becoming the developing processes to collect, analyze, and harder to achieve in higher education because disseminate information more effectively as uni- universities were behaving like for-profit compa- versities increasingly encounter threats to their nies (p. 208). Kirk also addressed Derek Bok’s po- operations (Hughes and White, 2005). sition in his 1982 book Beyond the Ivory Tower, which had extolled the virtues of industry/aca- Adopting a Competitive Intelligence demic partnerships, and noted that more recently Framework in Higher Education Bok had adopted a somewhat different perspec- Historically, adopting a competitive intelli- tive on these arrangements between the academy gence (CI) infrastructure within an academic or- and industry, cautioning that mounting require- ganization has posed challenges and raised objec- ments of industry demands would come at the tions from both internal administrative and expense of academic freedom (Kirp, 2003). academic quarters. Though CI techniques have American institutions of higher education been adopted successfully within the business are clearly facing serious financial constraints. landscape, these methodologies have not yet Kirp (2003) states the need for institutional lead- gained general acceptance as an asset within the ership to develop a more entrepreneurial orien- not-for-profit educational arena. tation toward generating revenues. Because uni- CI methodology analyzes and disseminates versities today confront an overload of burdens, external information that can assist with organi- while being badly constrained by their traditional zational decision making and the design of stra- financial infrastructure, they must become more tegic plans (SCIP, 2004). According to Hughes and proactive and entrepreneurial. “If they do not,” he White (2005), CI practices in corporations con- cautions, “they will put themselves at consider- tinue to grow at a substantial pace, and annual CI able risk during the first decades of the 21st cen- spending is estimated to be in excess of $2 billion. tury” (p. 1). New avenues of revenue development However, according to Hughes and White (2005) are needed for higher education institutions. Op- the majority of CI activities within higher educa- portunities must be identified, and cultivated. tion have remained focused on developing aca- The in which higher ed- demic programs and curricula to prepare accred- ucation operates is competitive for both revenue ited competitive professionals. CI activities within and students. This situation presents immense higher education have not directly impacted or challenges as well as opportunities for higher­- benefited the higher education strategic planning education leader who possess the skills and can process. marshal the needed resources to shift their insti- The emerging threats that universities now tutions’ focus away from the traditional methods face include but are not limited to: of revenue generation and identify new and ex- • Shrinking enrollment. panding opportunities which are unique, market- • Rising costs. able, and profitable. • Demographic changes. Colleges and universities must take more in- • Online competition. novative approaches toward financing. Institu- • Increasingly competitive fundraising en- tions must develop resource systems that enable vironments. them to continually identify and apply fresh ideas • Accreditation pressures.

28 World Future Review August-September 2010 • Recruiting needs. might cause a university problems related to pub- • Decreasing state and federal funding op- lic relations. portunities. Additionally, according to Hughes and Competitor Assessment White, “The uncertainty from these threats ne- Competitor assessment techniques include cessitates that universities place a strong empha- the analysis and evaluation of operational activi- sis on improving efficiency and effectiveness in ties of a university’s competitors. These compet- how they structure, manage, and deliver these ser- itors include emerging institutions as well as tra- vices to their constituents.” (2005) These authors ditional rivals. Specific institutional activities to emphasize that CI activities should be part of a compare could include marketing, operation, in- broader strategic planning process—one that tellectual property policies, research and devel- could assist in improving ongoing oversight of opment, finance, information technology, and the multiple higher education environments through profiling of top-level administrators. Addition- the implementation and dissemination of CI ac- ally, Hughes and White suggest, universities can tivities through departments. also analyse new processes, services, and technol- While it may be assumed that CI activities ogies within their competitive landscape. Another could benefit a higher education institution, the useful area might be analyses of how well their basic tenants of CI may seem counterintuitive to competitors are dealing with legislation impact- the traditional landscape encompassing higher ing higher education, or with regard to cost sav- education’s disinterested inquiry. Hughes and ing, and outsourcing decisions. White state in their findings that the lack of for- profit orientation, fears of academic turf wars, Win-Loss Analysis general disagreement concerning competitive in- Defined as a customer service activity, win- telligence principles and practices and lack of re- loss analysis applied to higher education could in- sources have all contributed to limiting higher ed- volve contacting students, donors, and alumni fol- ucation’s adoption of CI methodology. lowing a course, program, or event to determine According to Hughes and White (2005) the satisfaction levels. When applied to higher edu- following techniques can be utilized to assist uni- cation administration, Smith and Hughes note versities to minimize risks from competitive that win-loss analysis can increase student reten- threats: tion rates, identify more efficient fundraising methods, and better determine the effectiveness Benchmarking of an event. Assessing internal practices in comparison to industry “best practices” on the basis of any one of War Gaming a variety of standard organizational criteria. According to Hughes and White (2005), war gaming is a competitive intelligence technique Background Checks utilized to help an organization respond to a cri- Background checks have been used exten- sis or surprise event. This analysis involves both sively to minimize the possibility of hiring indi- predicting future alternatives and determining viduals with suspect backgrounds and placing how to respond to unexpected events. By utiliz- them in positions of high responsibility. Back- ing methodology such as scenario building, con- ground checks can assist a university in minimiz- tingency planning, and simulations, a university ing the likelihood of hiring an individual who can better assess the probability of an event oc-

World Future Review August-September 2010 29 curring as well as planning in advance how to re- cross functionality and the institution must have act in specific situations. in place systems that seek pertinent and relevant information from within and across their sectors. Network Analysis will be a cornerstone in these pro- According to Hughes and White (2005), net- cesses; resistance to change must be eliminated. work analysis is developed through strategic alli- The CI methodology outlined in this article ances for the ultimate goal of broadening the uni- can enhance and improve a university’s ongoing versity’s knowledge base. For higher education, strategic planning processes. All initiatives must network analysis can assist a university in judg- be deliberate in nature and based on current and ing the value of pursuing alliances with other in- relevant research. Benchmarking, background stitutions to reduce costs or enhance innovative checks, competitive assessments, and win-loss programs. analyses are all important elements of an aca- demic CI structure that universities should adopt Conclusion if they wish to survive and flourish in the higher Academic leaders face enormous internal education arena. Academic leaders must seek out and external pressures and challenges. Guiding CI professionals who can initiate, administer and their institution appropriately, meeting ever in- manage the CI function within their institutions. creasing fiscal demands, remaining competitive and relevant to the marketplace are all key to suc- References cess and survival. Bok, D. 1982. Beyond the Ivory Tower. Cambridge, Historically noncompetitive, the higher ed- MA: Harvard University Press. ucation sector is now having to adjust dramati- Hughes, S., and R. White. 2005. “Improving Strategic cally to new and increasing demands on numer- Planning in Universities through Competitive Intelligence ous levels. To remain successfully operational Tools: A Means to Gaining Relevance.” Journal of Higher within the higher educational market universities Education Outreach and Engagement 10 (3 Spring/Sum- today must consider all relevant forces which can mer). impact present and future planning. Those insti- Kirp, D. L. 2003. Shakespeare, Einstein, and the Bot- tutions that were quick to seek information rela- tom Line: The Marketing of Higher Education. Cambridge, tive to their competitive landscape are more likely MA: Harvard University Press. to have positioned themselves securely for future Newman, N., L. Couturier, and J. Scurry. 2004. The growth. Future of Higher Education: Rhetoric, Reality, and the Risks Adjusting to this changing landscape is a ne- of the Market. San Francisco, CA: John Wiley & Sons, cessity, not an option. How to navigate operations Jossey-Bass. effectively in today’s dynamic environment de- Horne, M., and T. Parks. 2004. “Implementing CI in mands a concerted effort to reframe an organiza- a Non Profit Environment.” SCIP Journal (January- tion’s programmatic delivery environment as well February). as its institutional mentality. Expectations of Slaughter, S., and G. Rhoades. 2004. Academic Capi- growth based simply upon reputation no longer talism and the New Economy. Markets, State, and Higher exist. A concerted effort towards changing func- Education. Baltimore: The Johns Hopkins University Press. tions is obligatory. Washburn, J. 2005. University, Inc.: The Corporate The CI process within higher education notes Corruption of Higher Education. New York: Basic Books. that programs must be competitive and relevant, operations must be efficient, networks must have

30 World Future Review August-September 2010