David Collis
Peter Frank Adjunct Professor of International Business Administration
School of Management, Yale University
The Paradox of Scope:
A Challenge to the Governance of Higher Education
This paper argues that inherent weaknesses in the governance of higher education institutions threaten many of their futures. As the external environment of universities and colleges undergoes profound change in the face of globalization, new technology, and the intrusion of market forces
(Collis 1999 and 2000, Newman 2001, Kirp 2002) to successfully adapt universities and colleges must develop, and implement clear and concise strategies that make difficult choices among very different alternatives (Porter 1992). Unfortunately, the governance structure of universities, which involves many stakeholders with diverse interests and veto power, impedes their ability to make those hard choices.
The paper draws on recent research in the strategy field that has identified “the paradox of scope”
(Sawhney and Gulati 2001). This explains the blurring boundary of the contemporary firm by observing that the traditional core of many companies is shrinking as activities, such as IT, and even manufacturing are outsourced, while the periphery simultaneously expands through the proliferation of alliances, joint ventures, and partnerships.
The argument will be made that the same phenomenon is occurring within universities and colleges
(Zemsky and Massy 1995). Data will be presented that demonstrate how the traditional core of the university – full time faculty, liberal arts and scientific education, student services that act in loco
parentis, the library, etc. – is declining, at the same time as which the periphery of the institution – outsourcing partnerships, corporate training, vocational courses, sponsored research, license and patent activity, discrete institutes and centers, etc. – is expanding. The operation of this “paradox of scope” within higher education extends the set of constituencies that must be managed by every institution, while shrinking the share of activities with which participants in governance are acquainted or capable of administering. The result is likely to be even more conservative institutions, frozen in panic in the headlights of the oncoming educational revolution.
The paper will conclude by proposing recommendations for improving those structures that are derived from the experience of the private sector as it too struggles to reconcile the “paradox of scope”. While there are obviously important differences between higher education and industry, not least the existence of a single objective – shareholder value maximization – within business, the efforts of bodies, such as the Cadbury committee in the UK; reformers, like CALPERS in the US; and the self examination by companies like GM, do provide valuable benchmarks and principles for higher education to consider.
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