ED-98/CONF.202/13
Paris, August 1998
Original English
Thematic Debate: "Contributing to National and Regional Development"
Leader: CRE/Columbus
Drafted by: John Goddard
University of Newcastle upon Tyne
in collaboration with:
. Association of Arab Universities (AAU)
. Association of African Universities (AAU)
. Association of Commonwealth Universities (ACU)
. Association of Universities of Asia and the Pacific (AUAP)
. Conseil Africain et Malgache pour l'Enseignement Supérieur (CAMES)
. The Association of European Universities (CRE)
. Community of Mediterranean Universities (CUM)
. United Nations' Economic Commission for Latin America and the Caribbean)
.International Association of Agricultural Students (IAAS)
. Inter-American Development Bank (IDB)
. Inter American Organization for Higher Education (IOHE)
. METROPOLIS
. OECD, IMHE Programme
. Programme of Research and Liaison between Universities for Development (PRELUDE)
. Union des Universités de l'Amérique Latine (UDUAL)
. Natura Network
. Utrecht Network
. World Federation of Teachers' Unions
ED-98/CONF.202.CLD.9
Summary
Not only has regional or local intervention become more important to economic success, but there has been a qualitative shift in the form of local policy towards indigenous entrepreneurship and innovation, and to providing a more sophisticated environment for mobile capital so as to maximise local value added (R&D and other higher status jobs, successful and therefore growing firms). This leads to a greater concern to harness university education and research to specific economic and social objectives.
Nowhere is this demand for specificity more clear than in the field of regional development. While universities and located in regions, questions are being asked about what contribution they make to the development of those regions? Whilst it might be possible to identify passive impacts of universities in terms of direct and indirect employment, how can the resources of universities be mobilised to actively contribute to the development process?
This implies a better understanding of universities on the part of regional actors and agencies and of regional dynamics on the part of the universities. An obvious starting for such an understanding can be provided by an audit of existing regionally relevant activities with the audit being jointly commissioned by universities and regional agencies. It may be that regional agencies have not clearly articulated regional needs and there may have been many missed opportunities for productive engagement. To reveal these opportunities, it will be necessary for universities to enter into a dialogue with various stakeholders in the regional development process (e.g. local and regional elected authorities, employers and employers'organisations, regional media).
Improved integration of universities with regional development will not be readily achieved by top down planning mechanisms at either the institutional or regional level but by ensuring that the various stakeholders in the regional development process - education and training providers, employers'organistions, trade unions, economic development and labour market agencies, and individual teachers and learners - have an understanding of each other's roles and the factors encouraging or inhibiting greater regional engagement.
In this paper, Professor Goddard suggests that regional criteria could be incorporated into national reaching and research assessment exercises and gives some examples.
The Role of Universities in Regional Development
Introduction
The autonomous teaching and research activities of publicly funded universities is coming under increasing pressure from governments and their electorates. The agenda has moved on from a desire to simply increase the general education level of the population and the output of scientific research; there is now a greater concern to harness university education and research to specific economic and social objectives. Nowhere is this demand for specificity more clear than in the field of regional development. While universities are located in regions, questions are being asked about what contribution they make to the development of those regions? Whilst it might be possible to identify passive impacts of universities in terms of direct and indirect employment, how can the resources of universities be mobilised to actively contribute to the development process? These questions are posed because development has a strong territorial dimension - national objectives can only be achieved by realising the full potential of constituent sub-national units and in this regard universities in different regions are being required to make a contribution.
This paper briefly outlines the impact of universities on local and regional development and then goes on to discuss some of the factors inhibiting or encouraging greater regional engagement. It argues that a prior condition for an effective dialogue between universities and regions that in turn could lead to a greater embeddedness is a better understanding of universities on the part of regional actors and agencies and of regional dynamics on the part of the universities. This paper seeks to contribute to such an understanding.
The Local and Regional Impact of Universities
An obvious starting for an improved understanding can be provided by an audit of existing regionally relevant activities with the audit being jointly commissioned by universities and regional agencies. Given the diversity of universities within a national territory, it would be also desirable if such an audit were co-sponsored by central government, in collaboration with a body representing the university sector as a whole. Appendix 1 summarise such an audit undertaken for the Committee of Vice Chancellors and Principals in the UK.
The starting point of any audit would be a direct economic impact analysis of universities as an economic sector. Universities are major employers of relatively high grade staff with considerable local spending power. While many of these staff may not be recruited within the region, support staff will
be. The student body itself will also have a direct local impact through local purchasing. Students will be a net addition to the regional economy, insofar as they are recruited from outside the area. All of these impacts are readily measurable by conventional economic multiply analysis. Likewise the effect on the overall employment structure of each region can be readily assessed by setting higher education in the context of the overall regional profile. This might reveal university employment growing whilst other sectors (e.g. agriculture and manufacturing) may be declining.
These direct employment impacts are essentially static. More significant are the dynamic effects which a university can have through interaction with industry. These are more difficult to measure but a university can audit the geography of its industrial interactions by identifying the location of partners in research grants and contracts, consultancy, exchanges of research staff and spin-out of university companies. Because such research based activity is essentially global in character only a small part is likely to have a regional relevance. A more significant impact is likely to be through teaching and the recruitment of graduates by regional businesses and through programmes of continuing professional development. Here it is possible to monitor the flow of students from home origins through different courses into local employment opportunities.
The final area that an audit should cover is the contribution of universities to social and community development. In many countries there are long established regional and local variations in participation in higher education and in the skills of the local workforce. Data on the flow of students through universities of the type outlined above can also be used to identify the contribution of universities to raising levels of education attainment in different parts of the country and to enhancing skill levels of the workforce by recruiting non-local students and placing them with local employers. Vocational programmes in such areas as medicine and social sciences, which bring direct community benefits, can be identified. In addition to programmes targeted to the needs of employers, universities will need to demonstrate contributions to non-vocational education and cultural programmes in the Arts. The role of the university staff and students in providing significant local audiences for the regional arts will need to be defined. Last, but not least, the role of university staff and students in providing key leaders in local civil society by participating in voluntary activities, interpreting world affairs in the regional media and undertaking strategic analysis of the regional economy and social situation can be documented.
In summary, the audit should provide public evidence as to how universities contribute a source of knowledge, linking the region to the wider world.
A Stakeholder Analysis
All of these impacts may have arisen without any conscious intervention on the part of the universities or regional agencies. Universities are characteristically lightly managed institutions and beneficial regional effects may simply flow out of the teaching and research priorities set for themselves by the academic staff. At the same time, regional agencies may have not clearly articulated regional needs to the universities, particularly to individual academics responsible for the delivery teaching and research programmes (as distinct from universities' senior management). There may therefore have been many missed opportunities for productive engagement.
To reveal these opportunities, it will be necessary for universities to enter into a dialogue with various stakeholders in the regional development process. These stakeholders are likely to include:
- Central Government bodies responsible for funding higher education;
- Local and regional elected authorities;
-	Employers and employers organisations (e.g. chambers of commerce);
- Arts organisations
- Regional media
- Lower tiers in the education system including schools and colleges
- Recent graduates, present and prospective students
In the context of national and international influences, each of these groups will have distinct goals and missions, means of delivering on these, financial drivers and constraints and customer/client relations. The nature of the interest of these groups in the well-being of the local community and how they can be articulated to universities will also vary. Unlike universities, which seldom have a defined territory, many of these bodies will be required by law to operate within a defined administrative area. The difference in the degree of permeability of territorial boundaries will create difficulties for dialogue that will have to be overcome. Notwithstanding these difficulties the partners will need to work together towards developing a framework which focuses on the nature of their regional interests and which can provide a starting point for further discussion. One such framework, focusing on employment related issues, and developed for the UK Department of Education and Employment is summarised in Annex 2.
Universities and Learning Regions
A key concept which is central to the framework set down in Annex 2 is that of the learning region. Central to any dialogue between universities and regional agencies will be an appreciation of the latest thinking about the nature of the regional development process. A brief discussion of this area of academic enquiry now follows.
The enormous transformations in the nature of the capitalist world economy since the mid-1970s, have had major implications for economic development strategies and their governance. First, the stability of production systems, product markets and national corporate relations have been undermined by the rate of technological change, most notably through the widespread effects of generic or carrier technologies such as ICTs. Technological innovation and access to resources for innovation (skills, knowledge, information) have therefore become central to the competitive strategy of firms, which have developed new flexible structures to better utilise and capture such advantages on a global scale. States have recognised the need to maintain a position on the leading edge of technology if they are to maintain employment and growth, and hence there is an increasing attention to policies to support and promote R&D, innovation and technology transfer.
Notwithstanding this policy orientation, the globalisation of finance and of the organisation of production - underpinned by ICTs that permit the flexible reshaping and reconfiguring of investment and resources - has weakened the bargaining power of the nation state. International bodies have encouraged greater freedom in the flow of goods and information such that now it is the nature of the production locality as much as national market characteristics that determines investment decisions. Not only has regional or local intervention become more important to economic success, but there has also been a qualitative shift in the form of local policy towards indigenous entrepreneurship and innovation, and to providing a more sophisticated environment for mobile capital so as to maximise local value added (R&D and other high status jobs, successful and therefore growing firms).
The importance of this perspective for managing firms and localities has been neatly captured by Kanter in her recent book World Class which is significantly subtitled " thriving locally in the global economy " (Kanter, R.M. 1995) According to Kanter, future success will come to those companies, large and small, that can meet global standards and tap into global networks. And it will come to those cities and regions that do the best job of linking the businesses that operate within them to the global economy. She argues that forces of globalisation are so powerful that communities must connect the global and the local and create a civic culture to attract and retain or " embed " footloose investment. The challenge is to find ways in which the global economy can work locally by unlocking those resources which distinguish one place from another. The essential argument here is that universities can provide a vital locational asset within the global economy.
Kanter goes on to argue that in the face of these globalising pressures, organisations have no alternative but to continually improve and attempt to be world class by paying attention to what she calls the 3 Cs - concepts, competence and connections. She links this to geography by suggesting that " world class places can help grow these assets by offering innovative capabilities, production capabilities, quality skill, learning, networking and collaboration. " The location of universities in regions is a powerful facilitator of these processes - concepts links to research; competence links to teaching and connections links to the transfer to and from a region of people and networks grown out of universities.
In order to realise such policy shifts, local policy has needed to be innovative and entrepreneurial itself, typically through drawing on a wider network of resources, negotiating and building alliances between local and other tiers of government, universities, private sector interests and non-profit organisations. Thus the successful entrepreneurial municipality shifts from being an arm of the national welfare state to a catalyst for local co-operation and policy innovation.
Regional success has been characterised by a range of different models, but with a common agreement as to the factors underpinning success: agglomeration economies, economies of scope, trust, networks of small firms and supportive institutions. Central to successful innovation are the structures and modes of interaction between knowledge producers, disseminators and users. Since technologies embody both people and ideas as well as physical artefacts, transactions involving extensive interaction and iterative communication are widely believed to be necessary as a means of facilitating exploitation. This 'organised' method of exchange can encompass both physical technology and/or employees - including producers, disseminators and users - moving between institutions while maintaining close linkages for instance, between universities and linked 'spin-off' companies.
Within this overall policy environment geographical differences in the nature of cultures, institutions and legacies of past industrial practices will clearly influence the effectiveness of the dissemination of knowledge between and within institutions whether at national or regional scales. Differences are particularly evident if interpreted as uneven capabilities in effectively organising, through informal or formal means, market transactions. For example, Lundvall illustrates the importance of a common culture and language shared by users and producers to facilitate the transmission and translation of highly encoded information such as R & D results. (Lundvall, BÅ (1988). Differences in training cultures and attitudes towards technology are also crucial to the effectiveness of modes of communication and exchange.
Studies of economically successful regions suggest that their success depends on what Amin and Thrift term " institutional thickness " or what Putnam calls " social capital " (Amin A and Thrift N, 1994). (Putnam, R.D. with Leonardi, R and Nenetti R.Y. 1993). Although difficult to define, this institutional thickness is more than simply a strong presence of institutional bodies and practices supporting enterprise. The institutions should have high levels of interaction, leading to structures of domination or coalition that can achieve collective representation of interests, and a mutual awareness of a common purpose: what Amin and Thrift term a 'collectivisation and corporatisation of economic life'. An attempt to shape the governance structures in local economic development, in a way that increases the likelihood of a beneficial impact must therefore be cognisant of the culture, social structures and politics of the institutional networks linking policy actors and the firms they seek to influence.
Defining the Learning Region
In the context of the role of universities in economic development, the most helpful approach to operationalising these ideas can be found in the concept of the learning economy which emerges from studies of national systems of innovation. (Lundvall, B-Å, 1992), (Lundvall, B-Å, Johnson, B 1994). Here Lundvall stresses the importance of interactive learning as the basis for innovation and change in modern developed economies. He defines the learning economy in the following terms. It is an economy where the success of individuals, firms and regions, reflects the capability to learn (and forget old practices); where change is rapid and old skills get obsolete and new skills are in demand; where learning includes the building of competencies, not just increased access to information; where learning is going on in all parts of society, not just high-tech sectors; and where net job creation is in knowledge intensive sectors (high R & D, high proportion with a university degree, and job situation worsens for the unskilled).
Within the learning economy different kinds of knowledge can be identified. First, know what, that is facts and information. Second, know why, that is principles and laws necessary to reduce trial and error; third, know how, that is the skills and capability to do something, skills that are traditionally acquired within the workplace; and finally know who, that is information about who knows how to do what and the social capability to establish relationships to special groups in order to draw on their expertise. Each of these different forms of learning uses different channels for information exchange. In the case of know what and why, formal learning in school and universities is the normal channel. Know how depends on practical experience through tacit learning (for example, through apprenticeships) but also increasingly through network relationships with industrial and commercial partners. Finally, know who is learned from social interaction via professional associations, day to day dealings with customers, sub-contractors and a wide range of other actors and agencies.
Focusing on network knowledge, this is a hybrid form of knowledge that is neither completely public or completely private. It depends on trust not the market and is characterised by such considerations as reliability, honesty, co-operation, a sense of duty to others. Network knowledge refers not only to the skills of individuals but the transfer of knowledge from one group to another to form learning systems - the institutional infrastructure of public and private partnerships. Because network knowledge is highly dependant on interpersonal relations, it can most readily be developed within a particular region. Thus Florida argues (Florida R, 1995), 'to be effective in this increasingly borderless global economy, regions must be defined by the same criteria and elements which comprise a knowledge-intensive firm: continuous improvement, new ideas, knowledge creation and organisational learning. Regions must adopt the principles of knowledge creation and continuous learning; they must in effect become knowledge-creating or learning regions'. Key to such a learning region is the human infrastructure and the institutional mechanisms that foster interactive learning, and a central part of this infrastructure, in terms of the reproduction and adaptation of human resources, are universities.
In the case of human capital, universities in many countries have traditionally produced raw graduates for a national labour market dominated by large employers, with little concern for SMEs or graduate retention in local labour markets. This model has begun to break down in response to changing patterns of employer demands such as the decentralisation of large corporations into clusters of smaller business units and the greater role of smaller businesses as sub-contractors, suppliers, franchisees etc. Such trends have important implications for the skills required of graduates and the location of the firms' recruitment decision. It is therefore not surprising that regional agencies are promoting graduate retention initiatives as a way of upgrading the stock of higher level local skills. In parallel with these demand side changes the expansion of higher education provision together with rising numbers experiencing the need to change career later on in life is leading to a growing supply of mature local students for undergraduate and postgraduate programmes.
Notwithstanding these developments, very little is known about the flow of students through higher education into local labour markets and how this relates to the overall economic performance of regions. Yet a key characteristic of the learning region is the way in which knowledge is transferred from one group to another to create learning systems. In terms of universities this includes knowledge of the appropriate skills and competencies required of the workforce.
What constitutes " appropriate skills " will depend on the overall regional development strategy, be it indigenous development based on local enterprise, exogenous development based on attracting inward investment, or a combination of the two, for example by upgrading local suppliers to support and " embed " inward investment. In this context, the analogy between regions and organisations is one where the shift from personnel management based around handling individual employment contracts and personal development to human resource management which harnesses people development to the strategic objectives of the organisation. So the key question becomes: " Does the region include a human resource development as part of its overall strategy? "
This question raises a number of specific challenges concerning the type of training programmes, what institutions are best placed to provide the programme, and where within the region or for that matter outside should this provision occur.
So an obvious requirement of a regional human resource strategy is information about future labour market needs. Given the long time lag between the identification of needs and the development of the necessary skills, one of the fundamental requirements of a learning region is the sharing of intelligence between the education and training system and employers. In addition to ensuring that the education and training system produces people with the flexibility to respond to changing labour market circumstances attention has to be paid to the specific skills and competencies required by particular industries and/or occupations.
Labour market intelligence focuses on the direct contribution of universities to the economic success of their localities. A further question concerns the indirect contribution of universities to the social and cultural basis of effective democratic governance and, ultimately, economic success. For example, Putnam, has shown the strong relationship between civic culture and institutions (understood as " norms of reciprocity and networks of civic engagement ") and wider socio-economic performance. (Putnam, R D with Leonardi R and Nanetti, R Y, (1993). Regions or localities that are rich in such networks 'encourage social trust and co-operation because they reduce incentives to defect, reduce uncertainty, and provide models for future co-operation'. In so far as universities are by tradition classically " civic " institutions, they can play a key role in the development of the cultural and political determinants of socio-economic success. A key challenge is to enhance the role which universities, and their staff and students, play in the development of such networks of civic engagement, and hence in the wider political and cultural leadership of their localities (for example through the formal and informal engagement of universities in local political processes, through university staff serving as elected politicians or providing a source of advice for local government, contributions to the media etc.).
Implications for University Management
The implications of many of these processes of globalisation and localisation that have been outlined have yet to be addressed by most universities. The scale of the challenge should not be underestimated.
Adjusting the curriculum to rapidly changing needs of employers and the labour market provides a good example. In terms of Lundvall's description of the learning economy, whilst universities have been good at the know what and know why aspects of education, and are improving on the know how aspects through incorporation of the tacit learning acquired via work placements into teaching programmes, the know who dimension is altogether more problematic. Progress on this front implies a deep relationship between research and teaching based on the sharing of the network knowledge of the research endeavour with students at all levels.
When considering their relationship with industry in a regional context Universities need to consider themselves as being located at the head of a supply chain which is devoted to the provision of knowledge. The distribution channels for this knowledge are through students (projects and placements), graduates and post-graduates, as well as through published and contract research and consultancy that leads to new and improved technologies and management processes. But unlike a business enterprise situated in a similar supply chain position, universities devote relatively little resources to marketing their products in the form of graduates or to responding to signals about what the market wants. They simply have a sales department, in the form of the Careers Service, which has no ability or mechanisms to match output (quality, quantity or specification) to customer needs.
The market place is, of course, extremely complex because it is composed of the totality of organisations that currently, or might in the future, employ graduates. At one end of the spectrum are tightly regulated vocational markets like medicine, architecture, law and engineering. At the other end of the spectrum are the largely unarticulated demands of SMEs. If universities are to play a more active role in economic development, it is vital that they understand the market, segment it and use this information to guide their teaching activities. This means not simply responding to currently expressed wants but actively researching the dynamics underlying changing employer needs and treating students as clients and employers as the end customer.
In some countries the fact that this approach is far from universal can be partly attributed to the student funding regime which currently rewards " production " but not " sale ". In consequence the marketing function is often poorly developed. If universities were in part rewarded for the delivery of graduates into employment, including local employment, they would clearly have an incentive to put more effort into marketing and economic development.
But becoming a market led organisation requires a major change in university culture. It implies a strong sense of institutional purpose whereas universities remain dominated by academics whose principle professional loyalty is to their national or international invisible college rather than their parent institution. The " new production of knowledge " described by Gibbons et al involves partnerships with the users and beneficiaries of research that transcends institutional boundaries and which are difficult to integrate with formal institutional planning and resource allocation. According to (Gibbons et al, 1996) new patterns of strategic alliances between academic groups based on complimentary competencies may occur but not between institutions within a region.
In short, improved integration of universities with regional development will not be readily achieved by top down planning mechanisms at either the institutional or regional level but by ensuring that the various stakeholders in the regional development process - education and training providers, employers and employers organisations, trade unions, economic development and labour market agencies and individual teachers and learners - have an understanding of each others role and the factors encouraging or inhibiting greater regional engagement. For example understanding that universities and labour market agencies work in the context of national higher education policy and labour market training targets, employers of global competitive pressures to downsize, outsource etc. and students of personal financial constraints on investment in learning.
While national governments may seek to increase the engagement of universities with economic development, the means of achieving this goal is far from clear, particularly in the context of the value universities attach to individual autonomy. Such autonomy is associated with a diversity of institutions, often on a regional as well as a national scale, a pattern which has evolved historically. For those universities with a strong research base, regional issues may be of minor concern. Such institutions see themselves as serving the region by attracting students from outside with those students who remain adding to the local stock of human capital. They also contribute to attracting inward investment and possibly embedding that investment through training and research links. Such institutions thus contribute to exogenous regional development. Nevertheless, even within research based universities, certain departments, degree programmes and research activities will have strong regional linkages.
Alongside such institutions in most regions are those where serving the local and regional community remains a central component of their mission. Regional universities also have national and international links that can provide gateways for local firms and students to the wider world. Finally, between these extremes there may be universities which are trying to develop their research base in selected fields and in the process devoting considerable resources to " going global ". Determining which particular mix of institutions and more importantly mix of teaching and research programmes would best underpin the economic development of a region is a key challenge. With the right form of incentives in terms of government procedures for university assessment and leadership development programmes, it might be possible to ensure that the appropriate signals reach and are embedded into the programmes of individual universities.
As regards assessment, regional criteria could be incorporated into national teaching and research assessment exercises. In addition, a strong case can be made for establishing a regional assessment process undertaken by universities themselves. Such assessments could be done with the aid of consultants with expertise in economic development and higher education management. The assessments would cover institutional organisation, teaching, research and other services actually or potentially relevant to regional needs. The outcome of the assessment could be linked to a government development fund for pump priming initiatives which seek to enhance the university's contribution to economic development. Institutions would be free to participate in such a scheme and/or confine it to those parts of their activity that they deem to be regionally relevant.
A number of questions will need to be addressed in such assessments. These include:
Synthesis: Does the university recognise that by its very nature the territorial development process is broadly based embracing economic, technology, environmental, social, cultural and political agendas? The university is capable of contribution to this process across a broad front, not least by highlighting the interconnections across these various areas. Indeed regional engagement provides an opportunity for reasserting the unity of the university as a place based institution.
Collaboration: Are procedures in place to support inter-university collaboration? All universities in a region have an interest in raising participation in the lifelong learning process. " Growing the market " is to be preferred to mercantalism and this will involved collaboration within and between levels in the education system, including schools and colleges.
Partnerships: Are the objectives of partnerships clear? Partnerships are for the long term and need to move beyond the identification of additional sources of funding to dialogue that affects the behaviour of participants.
Mapping and Measuring: Who talks to who about what? The university's pattern of regional engagement will need to be mapped and the flow of information down these channels measured. Intelligence about the flow of students into academic programmes and subsequently into the regional labour market is a fundamental measurement task for the university.
Human Resource Development: Is the regional agenda incorporated into institutional HR policies? New agendas need new skills on the part of administrators and teachers and these need to be recognised in the university's HR programmes.
Focus: What is the distinctive contribution of the university to the regional agenda? Notwithstanding the potential breadth of its contribution the university will need prioritise those areas where it can make the most cost effective contribution to the development of the region.
Geographical Identity: What are the unique feature of the region to which the university can contribute? While there are global, economic, technological, social and cultural drivers of the development processes, these interact very differently with specific regional development trajectories. The university will need to develop a collectively understanding of its region in order to identify particular opportunities for engagement.
Regional Policy: What are the main drivers of regional policy? Regional and national agencies have a suite of policies to address regional development. The university's need to understand these policies and identify areas where they can support and reinforce these policy objectives.
Leadership: What role does the university play in regional leadership? In addition to responding to established policy, universities have the capacity to set regional and national agendas. This involves more than injecting good ides into the policy process; it also requires building the institutional capacity to take these ideas forward.
Teaching and Learning: Has regional labour market intelligence influenced the shape of teaching and learning programmes? Whilst mechanisms are being put in place in some universities to respond to the regional research agenda, less progress appears to have been made on linking teaching and learning to regional needs.
Mainstream: Has regional engagement become part of the academic mainstream of the university? Whilst many universities have established gatekeeper functions (eg Regional Development Officers) it remains unclear how far this has influenced mainstream teaching and research.
Communications: Are regional needs and priorities communicated through universities? In addition to strategic engagement, there will be opportunities for regional engagement generated externally and internally that will need to be communicated around the institution. Newsletters, electronic mail and established fora provide an opportunity for such communication.
Research and Intelligence: Is the university providing the region with intelligence for its forward planning? In order to shape the regional development agenda the university's will need to draw upon its global network and external information and tailor this to regional needs.
Responsiveness: Is the university able to respond quickly to unanticipated regional needs? Economic development is opportunistic as well as strategic. If windows of opportunity (eg release of a new technology, mobile investment projects, new fiscal incentives, new regulatory regimes) are not seized regionally the advantages will be taken up elsewhere. The university will have to put mechanisms in place to respond, for example with new courses and research programmes
Alongside such assessments it would be necessary to have a programme of human resource development targeting those individuals inside and outside of universities that have boundary spanning functions relevant to joint working on economic development. One of the key factors of success in regional partnerships in the presence of " animateurs " who act as gatekeepers between different organisations/networks. A small number of staff in universities, labour market and economic development agencies and dynamic businesses hold positions in which extra-organisational networking is a central feature of their job. People who hold such position will do so by virtue of their personal and professional competency; they nevertheless require developmental support for their own professional improvement, and moral support from individuals and groups around them. For the most part the necessary skills and attributes are intuitive and learned through practice; however the growing need for such people suggests that some more fundamental training and support is required. Relevant skills include: networking; facilitation; working with alternative cultures; setting up projects; planning and contract management; raising financial support; personal organisation; supervision and
personal support techniques; insight into organisational policies and dynamics. The establishment of such a development programme for individuals engaged in the university/regional interface would be a further small positive step towards its improved management. Similar strictures apply to other stakeholders concerned to raise regional competitiveness.
Points for reflection
The importance of interaction between knowledge producers, disseminators and users, leading to structure of collective representation of interests and a mutual awareness of a common purpose.
It could be interesting to carry out audits to identify " appropriate skills " for university graduates (to depend on the region's overall development strategy) and the university's contribution to social and community development.
The rapidly changing needs of employers and the labour market affect curriculum. Whilst universities have been good at the know-what and know-why aspects of education and are improving on the know-how aspects through incorporation of the tacit learning acquired via work placements into teaching programmes, the know-who dimension is altogether more problematic.
Could international networks play a role in the reduction of uncertainties and the sharing of knowledge?
Could regional criteria be incorporated into national teaching and research assessment exercises?
Could more fundamental training and support be provided for those acting a the link between different organisations (e.g. for skills such as networking, facilitation, working with alternative cultures, setting up projects, planning and contract management, raising financial support)?
What are the consequences of university-region interaction within the university?
Acknowledgements
This paper draws on a report prepared for the UK Department for Education and Employment on Universities and Economic Development by a group of researchers and managers at the University of Newcastle working through its Newcastle School of Management (Chief Executive, Dr Roger Vaughan). Other members of the team were Dr Madeleine Atkins, Dean of the Faculty of Education; Dr Roger Vaughan, Dr Richard Firth, Director of the Careers Service; Richard Tomlin, Director of Research Services, and John Dersley, University Regional Development Officer. I would also like to acknowledge the contributions of my colleague from the Centre for Urban and Regional Development Studies, Dr David Charles.
References
Amin, A and Thrift, N (eds.) (1994) Globalisation, Institutions and Regional Development in Europe, Oxford University Press, Oxford.
Florida, R (1995) " Toward the learning region ", Futures, 27(5), 527-536.
Gibbons M, Limoges C, Nowotny H, Schwartzman S, Scott P, Trow M (1994) The New Production of Knowledge, Sage Publications, London
Goddard, J.B., Charles, D.R., Pike, A., Potts, G. and Bradley D. (1994) Universities and Communities, Committee of Vice Chancellors and Principals, London.
Kanter, R.M. (1995) World Class: Thriving Locally in the Global Economy, Simon and Schuster, New York.
Lundvall, B-Å (1988) " Innovation as an interactive process: from user-producer interaction to the national systems of innovation ", in G. Dosi et al, Technical Change and Economic Theory, Frances Pinter, London.
Lundvall, B-Å (ed.) (1992) National Systems of Innovation. Towards a theory of innovation and interactive learning, Pinter, London.
Lundvall, B-Å, Johnson, B. (1994) " The learning economy ", Journal of Industry Studies, 2, 23-42.
Putnam, R.D. , with Leonardi, R. and Nanetti, R.Y. (1993) Making Democracy Work: Civic Traditions in Modern Italy, Princeton University Press, Princeton, NJ.
van der Meer, E. (1996) Knowledge on the Move: The University as a Local Source of Expertise, University of Amsterdam.
ANNEX 1.
UNIVERSITIES AND COMMUNITIES:
Summary of a report for the Committee of Vice Chancellors and Principals
Centre for Urban and Regional Development Studies
University of Newcastle upon Tyne
1. Universities in a changing external environment: the rationale for the study and its approach
1.1 Changes in Higher Education
. A wider social spectrum is now participating in higher education.
. The number of suppliers of higher education has increased, creating a marketing problem of product differentiation in which local uniqueness can be emphasised.
. More stop-at-home students and a rising demand for continuing professional development will be a feature of future development.
1.2 Reorganisation of Government
. Many quangos are looking to universities for board members.
. Universities can satisfy a requirement for independent analysis, a neutral forum and local leadership, especially in economic development.
. Greater private sector engagement in the local community (eg., with privatisation of public utilities where profits are linked to the health of the local economy) can stimulate new alliances with universities.
. Reorganisation and new priorities in the Health Service incorporating non-medical disciplines, present major opportunities.
1.3 Technological Change
. Increasing scale, complexity, speed and scientific intensification of industrial R&D is undermining the linear model of innovation
. Changes in the organisation of industrial innovation include: decentralisation of R&D and integration with production; greater role for small firms and customer/supplier relations in innovation
. Government is pressuring for more demonstrable direct benefits of public investment in science.
. There is a widespread belief, based on a few examples, that technology transfer processes can be localised.
1.4 Community Change
. Geographical change is producing a shifting local environment for universities: suburbanisation of city centre activities; inner-city decay; shift to small towns; north-south shift.
. New industrial dynamics include manufacturing decline and service sector growth especially tourism and cultural "industries".
. The growth of the voluntary sector (care in the community) is replacing some state involvement in community services.
. Universities are part of shaping/ameliorating trends (eg., role in city centres; city marketing).
1.5 Approach to the study
. A wide ranging review - previous studies had focused on specific aspects such as direct economic impact, technology transfer, property and planning.
. Some major topics had to be skirted, eg., the health services changes, continuing education, special cases of London, Oxbridge, N. Ireland, Wales and Scotland, role of Open University.
. The starting assumption was that improved University relations with the community are desirable and will benefit both parties - but this is not self-evident.
. The key challenges for VCs are to strike a balance between global awareness and local responsiveness; central strategy (central facilities) and decentralised engagement (departments and individuals).
1.6 Methods
. Literature review, official statistics, examination of documents and questionnaire survey
. Survey responses reflect the perceptions and aspirations of University leaders, not necessarily what is happening in departments further interviews are needed to capture processes.
Main components of the study: local economic impact (static); local economic development (dynamic); built environment; social and community development (Fig 0.1).
2. Defining the local community
2.1 Physical surroundings: the historical/cultural context
. Five broad categories of institutions were identified here.
. Ancient universities where the physical form and functioning of the city centre is dominated by the university: the image and perception of the place is synonymous with the university but where the institution itself is not locally orientated (eg., Oxbridge, St Andrews, Durham).
. Municipal colleges rooted in places which are not strongly identified with higher education (eg., Coventry, Sunderland, Derby).
. Metropolitan red brick/civic universities with strong regional identities (eg., Leeds - West Yorkshire; Newcastle - the North East; Manchester - the North West; Birmingham - West Midlands).
. Post-war out-of-town campuses in large cities or in small towns where there has been limited local rooting (eg., York, Canterbury, Lancaster).
. Decentralised multi-site campuses spread around a region (eg., Northumbria, Anglia, De Montfort, Ulster).
2.2 Impact Assessment Scales
. Administrative areas are seldom appropriate for statistical purposes necessary to use the local labour market area in which the majority of employees live and work.
. There are wide variations in the degree of self containment in terms of purchasing of goods and services according to size of city and location of city vis-à-vis other centres.
. The larger the area of impact assessment the greater is the degree of self-containment in expenditure terms, but the smaller the relative impact.
2.3 Service Territories
. Different services have different catchment areas depending on their specialisation and propensity of consumers to travel which in turn is related to frequency of use.
. Examples: sports facilities may be local, technology transfer regional and international.
. Administrative territories (eg., local authorities, Training and Enterprise Councils, Regional Health Authorities) are important for funding purposes.
2.4 Perception of Local Mission
. Institutional plans define specific local communities, some are laid down by statutes in the case of "old" universities.
. Multi-site "new" universities are staking out territory by the creation of new satellites (eg., Northumbria: Carlisle; Durham: University College, Teesside).
. Two-tier definitions are common (Sunderland: Wearside and the Northeast; Warwick: Coventry and the West Midlands).
. Greater regional emphasis is given in the institutional plans in the north compared with the south, and greater priority attached to community links.
3. Local Economic Impacts
3.1 The Geography of UK Universities
. Few large cities or sub-regions are now without a university (Figure 3.1).
. Seventeen major institutions in London; several cities have two universities for the first time.
. Uneven development of earlier periods of expansion is now correct.
3.2 Regional Distribution of University Employment
. There is a concentration of employment in the South-East, but this is in line with the region's share of total employment (Figure 3.2).
. Marked over-representation of higher education in Scotland.
. Universities are an important growth element in regional economies when other sectors have been declining or growing less rapidly (Table 3.2).
3.3 Urban Distribution of Higher Education Employment
. Higher education employment is concentrated in cities - the 10 largest cities with 34% of all jobs contain 46% of higher education employment. 31 of 33 urban areas with over 100,000 jobs in total have universities.
. In many major cities (Manchester, Edinburgh, Glasgow, Sheffield and Nottingham) HE share of total employment is twice the national average.
. Universities are often amongst the largest employers in these cities - 3rd and 5th in Newcastle; 8th in Nottingham. In the North East less than 30 private companies with over 1,000 staff, but 5 universities in this category.
3.4 Measuring Local Economic Impacts
. Assess direct employment effect as university employment plus extra jobs created or maintained in meeting university demand (expenditure on goods and services).
. Components of the assessment: total staff expenditure; non-wage expenditure; employment and capital expenditure; student expenditure outside of the university; student union expenditure.
. There is a need to adjust assessment to allow for direct leakage because of: proportion of staff living outside the locality; expenditure of staff and students in services outside the locality; proportion of students who are non-local; capacity of local firms to support university demand.
. Most impact studies have not made these adjustments and have used standard multipliers.
. Second-round impact is strongly influenced by local geography - generally the larger the locality the smaller the impact.
. Examples: Lancaster provides 1,352 direct jobs plus 351 indirect (5.9% of total city employment). Bristol Polytechnic provides 1,114 direct plus 2,100 extra indirect jobs (2.9% of total city employment).
4. Local economic development
4.1 Technology Transfer
. Technology transfer is one of the main external linkage activities and generally the most important issue in mission statements in terms of local interaction.
. This reflects industrial demand, local development prospects (indigenous development cf. mobile branch factories), pressures from government.
. The transfer of products which embody technical knowledge is not the most important form of interaction. Much interaction is in non-commodified form through learning by doing and movement of individuals.
. The chain link model best describes a process in which the industrial innovation cycle is linked at all stages with the corpus of scientific knowledge . (Figure 4.1).
. Firms and scientists must find appropriate partners worldwide; in contrast local small firms are much less likely to provide scientific challenges and pay for support
4.2 Mechanisms for Transfer
. Research grants and contracts involving industrial partners are important mechanisms. In aggregate Universities in more successful regions have higher income from these sources (Figure 4.2).
. Income from research councils and from industry follow a broadly similar pattern but with some exceptions (eg., Oxbridge, Edinburgh, Essex and Sussex are research council orientated; Nottingham, Dundee, Surrey and Warwick are more industrially orientated).
. Survey research indicates that industrial contacts are largely non-local (Figure 4.4).
. Consultancy: Provides an opportunity for existing knowledge transfer and greater tailoring to regional needs. However, university policy which supports individualistic consultancy arrangements are less likely to result in such tailoring as compared with focussed initiatives like Sheffield Hallam Advanced Manufacturing Technology Centre, Newcastle Engineering Design Centre.
. Licensing: Likely to be non-local due to the difficulties of matching products/inventions to the capabilities of local firms, paybacks are very uncertain relative to the amount of management time involved.
. Personal exchanges: project work with students (eg.,. Sheffield PLUS); sandwich courses; graduate retention in the local labour market; teaching company schemes; visiting professors. All make significant contributions to technology transfer but are seldom presented as such.
.
. Spinouts: There is a long history of examples but the rate of spinout is increasing with the development of IT and bio-technology. A notable feature is the recent growth of campus companies where University takes a major stake (eg., ULIS turnover of £5 million; SUBS turnover £11.5 million).
. Science Parks: Real university involvement is generally low, but universities gain from successful real-estate development with little input of management time. Science Parks lobby is liable to displace a wide range of other mechanisms which are more important.
4.3 Non-Technology Support for Industry
. There is a key role for management schools as decisions to invest in technology and its effective use depend on the awareness and competence of managers
. Some management schools focus on the special needs of small businesses, but this can undermine the achievement of research goals.
. Non-scientific knowledge (eg., politics of overseas countries, languages) has an important role in support of marketing by local firms.
4.4 Inward Investment
. Few inward investment agencies in England are able to communicate, in sufficient detail, the scientific strengths or skills potential of local universities.
. More decentralised corporate organisation of some firms is creating opportunities for upgrading of local plants: reinvestment chances considerably strengthened by greater local embeddedness, including HEI links.
4.5 Vocational Education
. Undergraduate vocational degrees, including sandwich courses; Enterprise in Higher Education initiative; continuing professional development (law, architecture, planning, social work, management, education, health). Accreditation of FE courses; new areas (eg., nursing); staff development (Investors in People).
. Key role of TECs - joint development with universities of labour market needs analysis; sponsorship of short courses; one-stop-shops; these links poorly developed, especially in "old" Universities.
4.6 Tourism
. Universities provide 'visitor attractions', but these are generally minor attractions which add to length of stay and total spend rather than being the reason for the visit.
. Vacation conference venues with 6.4% of conference market in terms of days. 30 Universities run year-round management training centres accounting for 15% of UK market.
. But universities losing out because of lack of top standard hotel amenities, especially catering.
5. The built environment
5.1 Quality of the Built Environment
. University buildings generally add to rather than detract from the quality of the built environment. 75% of universities are responsible for some listed buildings with up to half the total floor-space listed in some cases.
. The central location of many universities and the access they provide to the public means that they play an important role in the sense and quality of "public space" within the city. Current expansion 'on the cheap' is undermining this quality.
. Changing university research and teaching needs has undermined the case for maintaining some of these spaces (eg., botanical gardens, natural history museums).
5.2 Property-Led Urban Regenerations
. Universities are currently increasing their space requirements - a 1991 survey of 28 universities found that that 58% are planning to acquire new buildings and 65% are engaged in major refurbishments. A 1993 survey of 32 "old" universities revealed these are constructing 15,000 new student residential places.
. Expansion is via campus cramming, ex-urban satellites and most recently inner city areas where UDCs and other agencies, unable to maintain the 1980's momentum of property-led urban regeneration (Coventry, Humberside, London Docklands, Sheffield, Sunderland, Teeside), are now looking to universities to plug the gap.
5.3 Private Rented Housing Markets
. Students make a major contribution to housing markets in seaside resorts (Lancaster/Morecombe; Brighton; Bournemouth).
. But there are negative impacts on rent levels for local populations arising from high-paying multiple occupancies.
. There are also environmental "disbenefits" in terms of maintenance, safety etc. of student housing.
5.4 Land Use Planning
. Planning permission for student accommodation and car parking problems have major sources of conflict with local authorities.
. A long period of consolidation and adaptation of existing buildings rather than site expansion has led some local planning authorities to regard universities as static institutions and consequently to induce over-restrictive land use policies.
. Some planning authorities take advantage of the fact that universities are relatively fixed in their current locations, and cannot move away, to enforce demanding planning restrictions and planning gains.
. In general, if not in detail, universities and planning authorities have similar objectives. Authorities need to articulate in more positive terms what they are trying to achieve rather than what they are seeking to prevent.
6. Social and community development
6.1 Community Education and Local Recruitment
. "New" universities are more locally orientated in terms of recruitment; around half of "old" Universities estimate that they recruit less than 20% of their students from the local area whilst half of "new" universities recruit over 40% locally. Local recruitment is most marked in Scotland with 70% of Strathclyde University students coming from the region.
6.2 Access and Broadening Intake
. "New" universities have a higher proportion of their students who are mature or access entrants with non-conventional qualifications.
. Some "old" universities are moving in a similar direction (eg.,. Salford University's 2+2 degree). As many "old" universities as ""new" "have established franchises or gateway arrangements with the FE sector.
6.3 Non-Vocational Continuing Education
There are considerable variations between universities in the volume of this activity, with the industrially orientated universities (eg., Heriot-Watt, London Business School) having the least involvement.
. Involvement is lower in "new" universities where the emphasis is on vocational work.
6.4 Public Lectures and Other Communications
. 78% of universities hold free public lectures and a further 17% charge. These are often run in conjunction with local bodies.
. Lists of experts are supplied to the local media.
6.5 Local Sporting Facilities
. "Old" universities offer more provision, but there is generally a lack of promotion of facilities so as not to conflict with university needs.
. Many facilities have been developed in conjunction with local authorities and some reciprocation exists in terms of student access to outside facilities.
6.6 Access to Libraries and Other Facilities
. 90% of universities offer some degree of main library access but do not publicise the fact.
. The main information demand is for professional and European legislation information.
. Other facilities include: exhibition space, language centres, bus services.
6.7 Contribution to Cultural Vitality
. University-based multi-art centres in smaller towns have become important cultural centres in the region whilst university facilities in larger cities play a supporting role.
. Student unions play an important role in local youth culture. Their concerts provide a niche between club and major venues and are an important developing ground for talent.
. To reflect public usage many university facilities are being transferred to independent trusts or other partnership organisations.
6.8 Museums and Art Galleries
. 76 university collections are designated by the Museums and Galleries Commission as being of 'national distinction' out of a total of 300 such collections. Several have received HEFCE special factor funding. 54 are open to the public.
. Underfunding has reduced opening hours and the amount of material on display. Lack of relevance to current university needs has encouraged disposal.
6.9 University Community Services
. Universities are important parts of the community sector through training involvement in social work practice, general medical practice etc.
. Contribution to the community also occurs through social research in fields such as police studies, housing, health services.
6.10 Student Community Links
. 125 student action groups provide 15,000 volunteers who work with existing voluntary and statutory community organisations.
. The estimated economic value of this activity is £6.9 million; RAG fund-raising activities contribute approximately £2m a year to student community action projects.
. American experience illustrates the potential of utilising voluntary contributions to the local community as part of training experience, providing transferable skills such as problem-solving and negotiation. This 'education for citizenship' brings the needs of the community closer to the core educational mission of the university.
7. Managing the University - Community Interface
7.1 Strategies Towards Local Communities
. Only 4 out of 65 universities do not refer to the local community in their institutional plans. 81% have seen an increased involvement over recent years. But only 47% of "old" universities regard this as a matter of high priority compared with 74% of "new" universities.
. "New" universities are more likely to see themselves as supporting regional institutions, whereas "old" universities emphasise contribution to the cultural life of their region.
. The majority of "old" universities see themselves as "international institutions seeking to provide local support" whereas most "new" universities "seek to serve the local community and develop international strengths".
. 53% of "old" universities regard themselves as "proactive" towards the community compared with 78% of "new" universities. However, it may be easier for the former to develop local links than for the latter to go global.
7.2 Structuring University/Community relations
"New" universities are more likely to have clear and well documented policy statements, officer responsibility and formal reporting procedures. Older universities have more diffuse responsibilities and informal mechanisms. A contrast between a strategic approach and tactical engagement?
. Because community links spread across most functions of the university they are co-ordinated at a VC/PVC level in most instances.
In "old" universities central support is provided by Continuing Education, Industrial Liaison, Public Relations and Careers Officers. In "new" universities this is likely to be provided by a senior appointment such as "Director of Corporate Affairs".
. In some "old" universities new structures are being put in place, eg., Regional Advisory Group of Exeter's Policy and Resources Committee; Sheffield's Regional Office.
The aim in several "new" universities is to have the commitment to the region "firmly embedded in the consciousness and responsibility of all staff".
7.3 Relations with Local Bodies
. Statutes of "old" universities often require ex-officio representation of outside organisations on university governing bodies, whilst "new" universities emphasise individual membership.
. More than half of all universities have regular meetings with local authorities; in the case of "new" universities these are more likely to deal with economic development, urban regeneration and labour market matters. 81% of "new" universities record good relations with local authorities, compared with 43% of "old" universities.
. "New" universities have developed good working relations with TECs. Relations with other development agencies are stronger in the north of Britain than in the south.
. "New" universities are strengthening their relationships with Health Authorities and Trusts, challenging the position previously confined to "old" universities with medical schools.
. "Old" universities have statutory appointment responsibilities on various local bodies but are less likely actively to encourage their individual staff members to take on civic duties.
. Only 12 universities keep a record of non-centrally made staff appointments such as District and County Councillors, TEC Boards, Health Authorities and Trusts, School Governorships, Company Directorships. Through such appointments universities play a role in the functioning of local civil society.
7.4 Community Access to University Facilities
In addition to public use of facilities (referred to in Chapter 6) many universities provide accommodation for the offices and meetings of professional associations.
. Universities provide an additional focus for the cultural and professional life of the nation outside of London.
7.5 University Inputs into Local Economic and community Development
. Universities contribute to the less tangible aspects of economic development by building social networks, by linking key actors and by feeding intelligence into these networks.
. Central government and European policy emphasises the importance of coalitions of actors and agents, including the private sector, in local economic development. Senior university staff have played a key role in launching and supporting community leadership groups and providing independent analysis of local circumstances in their national and international context.
. Through publications, media comment and participation in the Common Purpose movement, universities are contributing to more self- aware and knowledgeable local communities.
7.6 Facilitating access and continuing professional development
. Informal relations with professions and businesses are being formalised into "clubs" with supporting information services (eg., Brunel Business Partnership, Manchester Business Links).
. Other arrangements are being facilitated through local consortia. although competing for students, universities recognise that they will benefit collectively by raising educational aspirations in areas where there is a weak tradition of staying on in education, or seeking it later in life.
. Distance learning is growing through local radio and links with cable TV companies, building on the success of the Open University.
7.7 Conclusion
. Variations in the way in which community relations are handled reflect different interpretations of the mission, mix of mainstream activities (eg., Medical Schools or not), different local contexts (eg., UDC or not).
. "Old" universities without a strong local orientation are strengthening local links, partly in response to outside bodies seeking to tap into their resources.
. The system of university/community links is therefore undergoing rapid change.
8. The way forward
8.1 Introduction
. The traditional emphasis on recruiting the brightest students and educating for a national elite is no longer a fair reflection of the characteristics of the bulk of the UK university system.
. Even in research based, internationally orientated universities, teaching and research in certain fields (eg., Medicine, Engineering, Social Sciences) has benefited from local links. For more locally rooted universities the robustness of local demand may be central to survival.
. University planning needs to recognise the importance of local environmental resources in three spheres: business, local government and central government.
. For most of these groups, the university remains a "black box" within which organisational procedures seldom follow business and government practice.
. The challenge is to identify mechanisms for better structuring university/community relations whilst recognising these procedural differences. However, community links should not be regarded as a panacea for too many community ills.
8.2 The university perspective
. Central activities (estates, personnel, purchasing, industrial liaison) operate separately with limited lateral communication in terms of community implications.
. Key interactions are decentralised through individuals and departments, with little central knowledge of what is going on. An audit of existing community linkages is required before any new structures are put in place.
. Universities should undertake a one-off questionnaire survey of all community-based activities with this information then being mobilised for the benefit of the whole institution.
. Each area of activity (eg., contributions to economic development, the built environment and social and community development) needs a clearly identified node or socket within the university into which individuals and organisations in the local community can plug.
. Representatives of nodes need to be brought together on a regular basis to drive through a community development strategy; this should be informed by analysis of the university's own capacity and of community needs.
8.3 Local agencies
. The local authorities are the most appropriate body to draw together the various agencies representing community interest in the university and developing a shared strategy.
. Likely additional participants in the development of such a strategy include TECs, health authorities, chambers of commerce, enterprise agencies, the police service, integrated regional offices of central Government.
8.4 Central Government and the Funding Councils
. A wide range of government departments generate and implement policies which differentially impact on interactions that universities can and do have with their local community.
. Few analyses of these local implications are undertaken and few statistics (eg., student recruitment/destinations, expenditure) are analysed geographically.
. Players should take account of the involvement of a wide range of Whitehall departments in addition to Department for Education (eg., Department of the Environment (DoE) - planning guidelines; Department of Employment (Doe) - TECs; Department of Trade and Industry (DTI) - regional financial assistance and technology transfer; Office of Science and Technology (OST) - research councils; Department of National Heritage (DNH) - Regional Arts, museums and sports; Department of Health (DoH) - medical schools).
. For all of these bodies territorial development of the university system and interaction with the rest of the economy and society is at best a secondary concern.
DfE policies - for example a shift to more home-based students - must recognise that this could adversely affect some universities and threaten as much as strengthen their contribution to their local communities.
8.5 Towards the bottom line
Co-ordination without additional earmarked funding is problematic; community involvement does not always clearly link to any immediate specific income stream.
. Key opportunities are provided by the European Regional Development Fund (ERDF) and European Social Fund (ESF) in some areas; similar arrangements could be put in place elsewhere by the re-direction of existing UK resources.
. ERDF Community Support Framework programmes require clear strategies linking projects to regional development; unless such frameworks are drawn up for university/community interaction these could become "a patchwork quilt of idiosyncrasy and complexity", following the pattern of local economic development described by the Audit Commission.
ANNEX 2
UNIVERSITIES AND ECONOMIC DEVELOPMENT
EXECUTIVE SUMMARY
Chapter 1 - Introduction
This study has sought to develop a framework for analysing and guiding university engagement with the economic development process at a regional level. It focuses on employment issues and draws primarily on experience of various initiatives in the North East of England. Additional insights have been derived from work in the South East region, with the National Inquiry for Higher Education and the OECD programme on Institutional Management in Higher Education.
The framework focuses on four sets of stakeholders - universities, employers, students and agencies concerned with economic development. Each group is subject to national and international pressures which influences the nature and extent of involvement with others in the economic development process; for example, universities have to operate within the context of national higher education policies, employers of global competitiveness pressures, students of declining public support for study and development agencies of national and EU regional/regeneration policies. The report seeks to facilitate the building of partnerships and stakeholdings in the economic development process by providing each with a better understanding of the other.
The over arching context for all of the stakeholders is the absence of a strong government commitment to regional economic development within England. This contrasts with strong support for local development through bodies such as TECs and measures like the Single Regeneration Budget.
Chapter 2 - National Higher Education Policy
National Higher Education Policy provides the context for university engagement with economic development. Whilst recognising the role of universities in " serving local and regional needs " this recognition has not been translated into funding formulae.
Very little analysis of the available data has been undertaken to define those needs, for example in terms of geographical flow of students from home areas, through university courses into employment in different parts of the country.
Published UCAS and HESA statistics suggest that between 18% and 48% of English undergraduate students attend a university in their own region, between 30% and 57% take up employment in the home region and 8% and 70% are employed in the region in which their university is located. Data for an individual university suggest important differences in the employment status and type of graduate finding employment within the immediate region.
The absence of such regional analysis is not surprising given the priority attached to competitive funding, the lack of incentives for inter-institutional collaboration and for work with local industry in the research assessment exercise, and the disciplinary basis of teaching quality assessment.
The CVCP has advocated that " universities should be funded in a way that supports (local and regional) collaboration and the sharing of facilities and expertise for research as well as teaching ". The appropriate organisational framework for higher education provision at a regional level - competition for market share, formal collaboration, regulation of institutional roles or full integration into a federal structure - that can best serve the needs of different types of region is a key issue for further research.
In the absence of a regional policy within higher education, other parts of government have either implicitly or explicitly provided incentives for universities to engage in economic development (eg Enterprise in Higher Education initiative, Technology Foresight, European Regional Development Fund, TEC/University partnership schemes).
Chapter 3 - The Regional Interests of Universities
How individual universities are handling the tension between pressures for great regional involvement and demands of national policy can be analysed by means of the matrix shown in Figure 1. In terms of both teaching and research, universities will have a mission, mechanisms for delivery against that mission, income/expenditure drivers and a need to develop good relations with students as clients or with industry and government as research customers. These considerations define the cells of the matrix. Within each cell those factors supporting and those inhibiting a greater regional role can be identified.
FIGURE 1
|
|
MISSION/ DELIVERY |
BUDGETARY FACTORS |
CUSTOMER/ CLIENT |
|
CURRICULUM |
CELL 1 |
CELL 2 |
CELL 3
|
|
RESEARCH/ CONSULTANCY |
CELL 4 |
CELL 5 |
CELL 6
|
The drivers for adoption of a regional development role in relation to the curriculum include the desire of universities to improve the rate of entry of graduates into employment by tailoring courses to the needs of local companies, job placements, etc., and to attract CPD students outwith HEFCE number caps.
Inhibiting factors in this cell include the lack of student demand for regionally relevant course (eg, engineering); student number caps locking universities into an historic pattern of provision; the absence of regional human resource strategies to guide course planning; lack of reward for academics for short courses or sub-degree level teaching; the role of national professional accreditation bodies; national standards of TQA; limited academic links with the regional training system below the senior management level.
The budgetary incentives for regional engagement in teaching arise from the growing number of " stay at home " students. The disincentive is that the new programmes that might be necessary to attract these students have to be introduced at the expense of established programmes because of aggregate student number caps.
A key incentive in terms of serving students is the possibility of creating ladders of opportunity especially for mature students through access and franchise arrangements. Support from TECs for local graduate retention and to integrate work based learning in the curriculum is a further positive factor.
Set against this is the limited public support for part time students; patchy involvement by TECs; an over-emphasis on graduate placement compared with the development of higher level skills; a focus on provision of courses delivered at a certain place and time rather than flexible learning opportunities; the problem of matching graduate attributes to SME needs.
In terms of the research mission of universities, the emphasis in science policy on wealth creation through industrial links and the pressure from government offices for collaborative HEI actions has strengthened the case for regional activity in the minds of senior university management.
However, the failure for this message to reach researchers in departments and the lack of individual incentives (eg, promotions, grant regimes) for regional engagement have generally outweighed these influences.
In terms of clients, and notwithstanding initiatives like Foresight Challenge and the Faraday Programme, the absence of a strong private sector R&D base outside of the South East has meant a lack of regional industrial research partners.
Common to all of the cells in the matrix are fundamental differences in the timescales involved in university teaching and research initiatives compared with the immediate needs of industry and regional agents (eg, a year to validate and launch a new course). Equally the welter of short term initiatives, competitive bidding procedures and the overlapping roles of various agencies causes confusion and imposes a heavy management overhead on universities. One consequence is that regional links are concentrated into semi-detached units like business school, industry centres, thereby not penetrating the academic mainstream.
Chapter 4 - Employers
Universities devote relatively little resource to marketing their products in the form of graduates or to responding to signals about what the market wants, not least because the funding regime currently rewards " production " and not " sale ". Market segmentation regionally and by type of employer, taking account of the changing nature of work, is one way by which universities can grow their business.
Universities need to understand the forces of globalisation that are impacting on employers internationally, nationally and regionally and which are feeding through into the demand for graduates by industry and occupation, in terms of the courses and skills required.
Key business responses to global pressures include outsourcing and concentration on core competencies; related supply chain management challenges; fragmentation of public services; search for productivity and service quality improvement through use of information systems; external penetration of local markets previously protected by distance (eg, direct tele-sales).
These forces interact with specific conditions in different regions and need to be assessed by universities in developing their regional role. (Regional market segmentation).
Employers may also be segmented into three major types. Type A (the larger mature organisations) are the traditional graduate employers with well established recruitment procedures able to pick and choose universities and students according to their profile.
Type B (the rapidly developing company) is emerging from downsizing, outsourcing, management buy-outs, privatisation etc of larger corporations or from fast growing independent starts. Such companies have a high demand for graduates but are much more difficult to reach by universities than Type A; they are the key to regional development strategies based around indigenous development.
Type C (traditional small enterprises) include recent start-ups, mature owner managed family businesses without a history of graduate employment. These companies find selecting, screening and absorbing green graduates highly problematic. It is in this area that the gap between employer requirements and the output of traditional undergraduate degree programmes is greatest.
In terms of career trajectories, graduates may move not only between occupations and industries but between different types of organisation, either by choice or structural change. This has implications not only for initial training but the need for assistance with career transitions (after care services), a process which can most easily be managed at a regional scale.
The need for responsiveness on the part of universities to changes in the market place in terms of type of employers, type of employment and industrial structures will require a strong regional dimension to university planning. Given that university based research on new technologies and new management procedures are important contributors to ongoing industrial and corporate dynamics, universities are well placed to use this internal knowledge to inform their own teaching programmes.
Chapter 5 - Students
The expansion of the supply of students has coincided with fundamental shifts in the nature of the demand for graduates noted above. Differential regional demand has been superimposed on long established regional variations in the propensity of students to progress into higher education. Analysis by universities of the demand for their graduates therefore needs to be matched with analysis of the supply of traditional undergraduates, postgraduates and mature students by region.
Participation in higher education is most strongly influenced by parental and peer pressures (greater in regions with a higher proportion of graduates in the population at large); job prospects are another important factor (greater in economically strong regions). However, universities in less economically strong regions which can demonstrate good employment prospects by offering courses linked to local employer needs may be able to counteract this effect.
In terms of students choice of institution geographical factors (town and distance from home) are almost as important as the course. The economic and cultural vitality of the locality in the choice of institution by students is a major incentive for universities to engage in economic development.
The lack of weight attached to career prospects reflects the limited career information fed into the student decision making process. This points to a stronger role for universities career services and alumni offices in marketing universities. For students wishing to remain in their home region or to have employment opportunities within the region of their university, mobilising links with local employers should be an important strategy.
38% of all students in higher education in the UK are aged over 25 and the location of an institution is a major influence on their choice of programme. According to one survey, 43% of mature students study at an institution less than 40 miles from their home, compared with 19% of the under 25's. In this context the debate about lifelong learning has unfortunately not been closely linked to that on universities as regional institutions. The contribution of non-vocational courses to the development of local communities through raising cultural awareness and thereby combating social exclusion needs greater emphasis.
Student financial hardship amongst both traditional and mature students is a major influence on attendance at the local institution. (50% of those from households in socio-economic group 5 study in their home region, compared with 36% from socio-economic group 1). Not only are there regional variations in social structure but also in the opportunities for part-time work whilst studying.
If the stock of human capital in less favoured regions of the UK is to be increased in order to raise industrial competitiveness many of the regionally specific socio-economic barriers to participation in higher education at various stages would have to be lowered.
Chapter 6 - Regions
The contribution of universities to regional development needs to move beyond simple economic impact statements to consider the way in which " top down " national policy for higher education can have differential regional effects (eg, poor results in the RAE might lead to greater regional engagement by traditional universities to compensate for lost income so leading to competition with established regional providers). At the same time " bottom up " regional initiatives (eg from TECs and Government Offices) are changing the characteristics of the higher education system at the margin.
The concept of the " learning region " can provide a common ground between these top up down and bottom up perspectives. Regional policy now recognises that one of the keys to raising regional competitiveness lies in enhancing the skills and competencies of the working population at all levels.
Research on national systems of innovation suggest that it is not only the skills of individuals that matter but also the way in which knowledge is transferred between one group and another to create learning systems - the institutional infrastructure of networks within and between the public and private sector which supports economic development. Because of the importance of inter personal relations such networks have a strong geographical bias. So key a facet of a learning region are networks which effectively communicate to the education and training system the skills and competencies required of the workforce into the future.
In the North East of England, universities engage with these networks in six ways. First via a TEC/VC Forum, convened by the Government Office North East, and which has spawned various sub-groups of officers. Second, the universities own forum, Higher Education Support for Industry in the North (HESIN). Third, TEC financial support for numerous initiatives related to graduates and employment. Fourth, TEC/University strategies which identify key roles for the university as a major business, supporting existing businesses, supporting people and in exchanging experience in support of strategy development. Fifth, engagement with inward investors through tailored training programmes for new staff and joint research links. Six, ERDF funded technology support measures in universities linked to regional industrial development priorities.
The North East exhibits a great deal of networking activity which increasingly involves universities. What is less clear is the precise role that the different networks play in the economic development process and the contribution expected of universities in each of them. The step from information exchange to action which influences in a significant way universities as partners in the economic development process and which would characterise the learning region has proved difficult.
Chapter 7 - The University/Regional Development Interface
According to Florida (1992) " to be effective in this increasingly borderless global economy, regions must be defined by the same criteria and elements which comprise a knowledge intensive firm; continuous improvement, new ideas, knowledge creation and organisational learning. Regions must adopt the principles of knowledge creation and continuous learning; they must in effect become knowledge-creating or learning regions ".
For this learning to take place, the individual partners have to be open to external influence and this requires change within the higher education, industrial and regional economic development systems.
The higher education system has shown itself to be very responsive to the establishment of new assessment regimes in relation to the funding of teaching and research; criteria which have a strong regional dimension now need to be incorporated into these regimes.
In teaching quality assessment, the attachment of a greater weight to employability skills within the curriculum would lead to greater regional engagement (eg, employer co-option on Board of Studies, enhanced roles for university careers service in advising on academic programmes, more graduate after-care services, translating the special needs of Type B companies into new programmes).
In research assessment, new incentives are required to encourage engagement with the tough challenge of knowledge transfer, including transfer via teaching undertaken in association with local companies and organisations (eg, along the lines of Teaching Company Schemes and Integrated Graduate Development Programmes).
Such assessment regimes will need to be underpinned by more relevant data, particularly concerning the flow of students through universities and in terms of their subsequent career trajectories. If employability, including regional employment, were criteria of assessment the incentive to make better use of existing data and establish longitudinal records would be greatly enhanced.
Many of these changes will require the acquisition of new skills on the part of academics and administrators at all levels within universities. Universities will need to incorporate engagement within the regional development system as a key criteria in their human resource development strategies.
In terms of the industrial system, one of the key characteristics of a declining region is a fragmented private sector, unable to aggregate its demands in a way that can be clearly communicated to the educational and training system. Intermediate private sector bodies at the regional level are not well developed in the UK. There are various business leadership teams championing urban and regional regeneration in which individual members of universities play an active part, but the overall impact of such teams is limited because the various initiatives are not " mainstreamed " within either business or university.
The key challenge is to raise levels of awareness amongst regional businesses of higher level skills to their own competitiveness and the contribution that universities can make to meeting these needs. Greater participation of those in universities charged with the marketing function (eg, Careers Service, Departments of Continuing Education) in business led fora would assist here, as would education and training links as well as research links to Type B companies.
In terms of public sector partners in the regional development process, (Government Offices, TECs and Business Links, Local Authorities, regional development agencies, innovation and technology development agencies, Further Education) careful consideration needs to be given to opening up the possibilities for active university engagement at the regional as well as the local level. For example, the near monopoly ascribed to Business Links in dealing with SMEs might not be appropriate in relation to some of the more specialised technology assistance available from universities. In TECs, Government Offices and Local Authorities, the strategic thinking capacity of universities needs to be mobilised in delivering future priorities; this could possibly be assisted by staff secondment at a senior level.
The development of better relationships between a university and its regional partners needs a thorough independent assessment of the relevance of current research and teaching programmes and institutional capacity to respond to evolving regional needs. There is a role for independent consultants in assisting universities carrying out such audits. Audits need to be paralleled by a programme to develop a cadre of " animateurs " able to work on the boundary between universities and economic development agencies.