Universities need to realise they’re in the service industry

UK universities are undoubtedly among the best in the world. True, the likes of MIT, Stanford and Harvard may often be the ones that top the rankings these days, but it’s British universities that are still spoken of with hushed reverence.

As a result, the culture of many British universities can certainly be considered elitist. But let’s not forget that virtually all UK universities have a touch of elitism about them − by their very nature they cater to a student with “higher” ambitions and charge a not insignificant price tag for the pleasure.

And herein lies the paradox.

Modern universities, despite perceptions, are in fact part of the service industry. Students pay and they are provided with a service. But some universities seem to struggle to reconcile their service sector status with their perceived position as hallowed fonts of educational and research excellence.

This has come to the fore since the introduction of the £9,000-per-year tuition fees. Students are leaving university with more debt than ever and are increasingly seeing “value for money” as a key issue when making university choices. An ideological gap has grown, where some universities seemingly have different ideas to their students about the concept of what a university even is.

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Of course, this mood shift has not gone unnoticed and the notion of “student as consumer/client” has gained traction, with a growing understanding that the UK may need to switch to a more business-orientated approach. So, how do British universities become more “client focused”?

To begin with, let’s look to the US. I’m not here to wax lyrical about the US system − their fees are extortionate, prohibitively so for many, but what the Americans do understand is that universities are indeed part of the service sector and offer their students a full 360 experience, with facilities that are often world-class. So, what are the keys to delivering such an experience?

The wooing
I think of this in terms of booking an expensive holiday. The holiday company treats you incredibly well from the moment your tickets are booked, you’re kept up to date with the latest information about your destination, and when you arrive there is a host of people on hand to cater to your needs.

I’m not suggesting that the British university experience should resemble a 5-star holiday, but the fact remains that students are paying tens of thousands of pounds for their university education, and many universities fall short in terms of the type of customer service that one would expect in the hospitality sector, for example.

Customer satisfaction
To date, many of our universities have viewed their role as a one-way impartation of knowledge. But the role of a modern university needs to be far more than that – it must throw a holistic perimeter of care around each student, to monitor and be responsible for everything from their engagement and interaction to their physical and mental health, financial matters, career paths and much more.

In all other sectors of the service industry customer satisfaction is placed at the very heart of what they do, with a full bottom-up approach − something that some universities have been slower at implementing.

The reality, of course, is it hasn’t been that long since British universities moved out of the state-dependent sector and, for some institutions, it will take some time to adopt a capital market perspective. However, since 2005 strides have been made in this area with the introduction of the National Student Survey, which has become an influential source of public information and has provided universities with a crucial source of consumer intelligence.

The age of Covid
Universities have found themselves at the centre of negative Covid-related headlines since the start of the pandemic. For now, they are enjoying something of an economic “free pass” that has not been afforded to the rest of the service sector, and still charging full fees.

Clearly, this unhappy status quo will not continue and there will undoubtedly be a reckoning that will rock the sector to its core. But out of the wreckage of Covid it is hoped that universities will capitalise on the opportunity to build back better by placing the student at the centre of the story.

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Perhaps some universities may finally invest in the much-neglected digitalisation of programmes (some have made strides here while others lag). And many institutions will be forced to embrace hybrid in-person/online teaching methods that, had they already been implemented, would have placed them in much better standing to weather a pandemic.

Certainly, such a watershed will require some universities that had been operating in much the same way for centuries to experience a moment of introspection and hopefully emerge resolute to being more adaptable in the future.

If nothing else, the pandemic has made universities realise that, without fees, particularly those of international students, their business model is vulnerable. And while many universities have multiple income streams, with corporate research funding being perhaps the most lucrative, without their students their very existence becomes something quite nebulous.

Steve Davies is professor of medical education at the University of South Wales, a consultant physician in Cardiff and the founding director of Learna, a provider of postgraduate online education, with courses spanning specialist postgraduate diplomas and MScs for medical professionals, to a portfolio of Executive MBAs.