With many higher education institutions becoming increasingly dependent on continuing education (CE) units to generate revenue and to fund overall institutional operations, strategic organizational options must be considered.
This begs the question of whether continuing education should gain autonomy from the rest of the campus or remain a part of the traditional infrastructure. Will the institution be better served by a CE unit that functions independently as the entrepreneurial arm of the university? Will an autonomous campus unit that is particularly attuned to market forces and niche markets serve the institution’s overall mission?
Many see the ground shifting in fundamental ways and recognize the current crisis in higher education as real; a new competitive environment where honoring tradition for the sake of tradition and hanging onto past practices could imperil the institution’s future. Hence, the argument that a CE unit functioning outside of the traditional campus mainstream would ultimately create internal competition and detract from the overall quality of the institution is increasingly being seen as specious.
Several reasons suggest an autonomous CE unit functioning outside of the restrictions governing the core institution would benefit it overall.
1. Greater Agility
With more control over its review and internal governance approval processes, an autonomous CE unit would have a greater ability to accelerate to-the-market offerings and respond to new market demands with more agility than units governed under the restrictions of the core institution. Savvy business decisions must be made rapidly in highly volatile markets and the glacial time frames — emblematic of highly bureaucratic institutions — constrain that capacity.
2. Market Responsiveness
The autonomous CE unit would likely have greater flexibility to expand its strategic programming choices and the authority to eliminate, in a timely manner, entrenched programs that no longer have a market demand. The competitive edge so necessary in today’s higher education environment and the resource efficiency that might not otherwise exist within the traditional campus will continue to be critical if institutions are to remain viable. At the same time, being able to use the CE unit to establish niche market programs and serve as an incubator for high-risk, high-potential, market-driven programs would strategically position the institution without draining resources from mainstream campus operations.
3. Profitability
As an autonomous unit with a business model functioning outside of the core campus infrastructure, initiatives such s differential pricing — adjusted to the laws of supply and demand — and a responsibility center management (RCM) governing approach are all possible. A differential pricing model serves to align revenue with expenses. It can be a way to fund additional offerings that would not otherwise be provided, and can move the institution up the supply curve of courses where demand exceeds supply. RCM allocates revenues to areas experiencing growth and encourages entrepreneurial activities, e.g. new programs and services, and enables the institution to build on its successes by making it easier to invest in academic programs and services.
As an essential revenue center, an important source of funding for institutional initiatives and as a fulcrum for innovation, investment and growth, an autonomous CE unit may break with tradition. However, the forward-looking institution might see this as building on what CE units do best: helping the institution adapt to the converging forces driving change in higher education.
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