Monday, 15 November 2010

How to decide on academic promotions

The latest research findings on promotions practice could save us all a huge amount of trouble, and even save some resources.

For a recent study by three Italian researchers has shown that random promotion is pretty much as good as anything else we can come up with. Their analysis was based on a multi-level hierarchy in which, in each period, some promotions were going to take place, some people left the organisation, and new people came in at the bottom. At each hierarchical level, people were ranked according to their performance in the tasks needed for that level. And then selection for promotion could be based on choosing the best, the worst, or a random person at each level for promotion to the next level. If, as is often the case in real life, and demonstrably so in academia, the skills needed at one level of the hierarchy are not highly correlated with the skills needed one level higher, then good performance at one level is not a good predictor of how well someone would perform when promoted. Under such conditions, the finding that random promotion is pretty effective in terms of overall organisational performance is perhaps less surprising than one might have thought.

But what does this mean for the way we ought to handle promotions in a university? All that form filling, interviews, promotion boards and the like, is it all a waste of time and effort? Well, perhaps much of it is! For even with all the effort we put into the process, it's still quite common for people to ask, 'why did he get promoted this time?' and 'why didn't she succeed as expected?'. For despite all our efforts to be 'objective' and thorough, I'm sure there are still big elements of subjectivity in promotions exercises - we promote people like ourselves, we promote 'agreeable' people who don't make too many waves, we promote a 'safe pair of hands', sometimes we even take a risk and promote someone known to be outspoken and opinionated.

And do we always get it right? No, of course we don't. We can all think of folk who've been promoted and somehow flopped at their promoted level, not really delivered the goods. Equally, now and again there is the unexpected promotion, someone not thought to be 'ready', whatever that means, who rises to the challenge and does surprisingly well.

So if universities in the UK are coming under pressure to cut costs, here's an area where some savings could be made. Introduce random promotions, saving on HR and administrative costs 'at a stroke'.

Wednesday, 10 November 2010

Thinking about a small open economy

Sitting out here in St Kitts, as the Caribbean sun is setting, it's rather easy to see why people are attracted to come out here as tourists. So it's no surprise, when we study the economic structure, to find that tourism is one of the biggest sectors, in terms of the employment and income it generates for the local economy. However, the past couple of years, in the wake of the financial crisis and world recession, have been pretty grim, with visitor numbers and spend per visitor both well down and hotel occupancy rates very low. Naturally, everyone out here hopes this situation won't last too long, but the signs are quite mixed. On the one hand, the US and other major economies are slowly recovering from recession and that might soon bring more tourists back to the Caribbean, including St Kitts and Nevis; and visits by cruise liners did very well last month. On the other hand, some of the local facilities look a bit 'tired' and need more investment - though the best are wonderful - while some countries have raised taxes on long-haul flights (e.g. the UK, just last week). So as things stand right now, it's quite hard to predict how the tourism sector will develop.

Last weekend we managed a really interesting trip around the island of St Kitts, a total drive of just 30 miles, with nice views of the coast for most of the way and impressive views of the (dormant) volcano in the middle of the island as well. For lunch we stopped at a Plantation Inn, shown in the picture. Well kept grounds, ruins from the former sugar industry (finally shut down in 2005 when the EU changed its 'sugar regime'), and a great hotel; and a nice lunch, too.

Thinking more generally about the economy here, we're on a very small island with a highly open economy. Yet when we read various reports on the economy, as part of our project here, it's hard to find much that pays serious attention to foreign trade, either in goods or in services. It's hardly mentioned except in passing in routine reports on the economic situation. Yet there has to be some potential here for expanding exports both of goods (the island already has a successful niche in electronic components) and of services. On the latter, one surprise was to find several US universities established here, including a veterinary school and part of a medical school. These offshore education establishments appear to be doing well and must be contributing significantly to the island's GDP - except that this contribution is not yet being measured! It's not totally clear what has attracted these institutions here, which makes it hard to assess whether there is potential for further expansion; but we suspect there probably is. In any case, we'll soon visit one or two of these institutions to learn more about them.

Meanwhile, my colleague and I are extremely busy right now preparing material for our first training workshop, due next week. We've already written a lot but we're still debating exactly what we should present this time, and what to leave until December. Personally, I think it's vital that we emphasise the regional and international setting in which this small economy has to operate, and that includes highlighting some of the trade issues - and opportunities - which I've been thinking about this week.

Thursday, 4 November 2010

The new world of fees, post-Browne

Since the recent publication of the Browne report on university funding in England, and the Government's Comprehensive Spending Review (CSR), the whole way we need to think about fees and funding universities in England has undergone a sea change. So let me try to sketch how things now look for English higher education. Since the options and likely budgets for Scottish universities have not yet been announced (other than an announcement that Funding Council grants to institutions for the next financial year might fall by 16%), discussion of Scotland will have to wait. For now, I focus entirely on the evolving situation in England, with particular attention to the arrangements for undergraduate teaching.

We used to think of the fees charged to students - whether paid up front or deferred until after graduation - as a sort of 'top up' fee, implying that there would be some form of base funding in place. Up to the present that has certainly been the case, with institutional grants from HEFCE (The Higher Education Funding Council for England) providing several thousand pounds per undergraduate student (in amounts varying by broad subject area), based on approved student numbers. Indeed when fees first came into effect in England, one of the concerns was exactly over the point whether the new stream of fee income would genuinely be 'additional funding', which all universities said they badly needed; or whether the government might find a way of paring back the base funding coming through HEFCE, leaving only part of the fee income as a real addition to university budgets. For the most part, though, it seems that the government played fair and didn't try to manipulate funding streams too much, so most of the fee income did go to the universities.

All that is about to change, since the CSR was seriously bad news for English universities. For the Browne report envisaged a £3.2 billion cut in the annual teaching grant, with nothing going to the arts, humanities and social sciences; only the STEM (science, technology, engineering, mathematics) subjects would still receive public funding to support undergraduate teaching. The CSR largely confirmed this position, with a £2.9 billion cut in funding by 2013-14. Official statements have since emphasised continuing government support for the STEM subjects, with no mention of funding for other subject areas.

Thus instead of fees being a handy 'top up', in future, in many subject areas, they will be the funding stream that pays for everything. I actually wonder how far universities really understood all this when they made their submissions to the Browne Review, including comments on the future fee levels they would like to see. For the existing fees of just over £3000 per student per year of study will soon be equivalent to a base fee of roughly £7000 - for once HEFCE's teaching grant for non-STEM subjects is removed, institutions will need to be levying a fee of around £7000 just to stand still financially. In that context, the government's announcement this week that it will allow fees to rise to the range £6000 to £9000 per student-year is less of a change, financially, than it appears to be. I can't see how any university can gain by charging a fee at the lower end of this range, and perhaps all will end up charging the maximum. We shall see, it all depends on how competition between institutions works out, in the new student-led environment. The last phrase is the critical one, for any institution that fails to attract the requisite student numbers will quickly be in deep trouble financially.

As for the students themselves, there will be loans available to enable the fees to be paid to institutions up front, when the teaching costs are being incurred, but students will only start to pay back the loans once they have graduated and are in jobs earning over £21,000 per year. The loans, however, will no longer be interest free; instead, interest will be charged at the rate of 3% above the rate of inflation each year. Any debt still outstanding after 35 years will be written off. Overall, this is not a bad model for the students, and I doubt whether its provisions will put many students off higher education.