Disruptive Innovation Helps Universities Overcome Financial Obstacles

It's Time to Rethink Budgets and Partnerships

In the Google/Boston Consulting Group study, over 40 percent of university and college leaders said it was their goal to reduce technology costs. Pursuing digital transformation — which requires taking on more tech — might seem like it would cost more, but not if approached in the right way. Leaders at Maryville University, for example, found it was important to rethink and reprioritize budgets.

“It’s really less about containing those costs and more about shifting away from the things you used to spend money on,” says Lombardi.

In other words, instead of going forward with a three-year computer refresh of on-campus hardware, it may be better to invest in something more innovative — or in a partner. Turning to others for help with digital transformation can be a critical step for many in higher education.

“When institutions want to do something, they tend to look inward and say, ‘Let’s create this,’” says Lombardi.

Building a private cloud or developing an in-house data analytics algorithm can be costly and time-consuming. Forming partnerships with institution-friendly companies like Google, Apple or Salesforce has become a much easier and rewarding path.

“If you use partnerships right, it gives you the power to expand opportunity for students in a whole host of ways that dramatically drive down costs in certain areas,” says Lombardi.

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Embracing Critical Solutions Is Necessary for DX Success

Three solutions stand out as common among fast-growing colleges and universities: use of the cloud, offering students increased access and the use of data analytics.

Because automation is a critical part of streamlining student experiences, the cloud is a necessary solution. It also carries financial benefits: Some IT infrastructure becomes unnecessary, thereby lowering costs. Those savings improve an institution’s bottom line and can be passed on to students.

“We’ve been able to do that with frozen tuition five out of the last six years, and we began the process of lowering it 20 percent,” says Lombardi. That presents an alluring financial incentive for prospective students and can draw higher enrollment.

The digitization of course materials is another solution that offers benefits to students and institutions.

EXPLORE: Creating a strong financial future for HBCUs.

“You’ve reduced student costs, you’ve improved their access to the information and tools they need and you’ve also leveled the playing field,” says Lombardi. That means higher education is not reserved for the privileged. Students with financial challenges, adults looking to study while maintaining a job and others will have an easier time budgeting for enrollment.

Everyone in a higher education environment, especially students, are producing vast amounts of data about how they live, learn and how they want services delivered, Lombardi says. Institutions pursuing technical innovation are applying artificial intelligence to all that data in order to yield powerful insights into their services and students.

AI can identify students at risk of dropping out and send out alerts to help them, improving the chances they’ll stay enrolled. Through student engagement, AI can identify what services or courses are working — or not. All of that can produce better and more tailored offerings to students from the course level to the administrative level. That can lead to better recruitment and retention, both of which are good for financial health.

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Don’t Fear Cultural Change

For institutions in the earliest days of digital transformation, the road ahead won’t be without its speed bumps, especially as temporary pandemic measures become more permanent as hybrid and blended education models. It may even seem risky, which is why moving ahead requires what Morales calls cultural change.

“You need to remove the fear of failure and try new things,” says Morales. “I’ve seen a lot of people with amazing ideas that they’re not afraid to implement in a digital transformation, but then they forget about the operational excellence and how to bring the costs down of what they’re implementing.”

As Maryville, WGU and others demonstrate, rewards await the persistent.

“If you’re going to do it, stick to it and just keep pushing through it,” says Morales.