The business of universities is … education? Excellence? Job placement?

By Emanuel Derman
April 30, 2012

Every day I seem to come across new articles or incidents concerning universities that indicate the increasing strength of the tidal forces pulling at them and their denizens:

Ethical problems: University of Pennsylvania sloppy about hiring someone with a fake PhD, then reluctant to fire him.

Profit-making as a dominant goal: The New Yorker on Stanford as Get-Rich U. Universities used to be safe jobs whose sole glamor was intellectual. Now not only university presidents but even faculty can make large amounts of money by patents, connections with business, consulting, boards, angel investing. There are massive discrepancies in salary across the faculty.

The relentless desire to grow at all costs: NYU faculty complain.

Part of the trouble is the perplexity as to where universities lie in the spectrum of higher learning vs business. Forty years ago, at least in my imagination from the student side of things, it was simple: as far as admissions, your grades were supposed to be all that mattered (in England and South Africa, provided in the latter case, of course, that you were the right color) and everything else counted for nothing. Universities were supposed to be dedicated to learning and teaching, and tenure provided some freedom.

Now, universities are different.

They patent algorithms.

Pharma companies reside on their premises.

Administrators think it’s their job to be entrepreneurs & fund raisers and multinational foreign-campus operators. They have PR departments. They worry about U.S. News & World rankings, and adjust to optimize them.

Departments strive to provide executive education as a way of generating funds.

Schools worry about whether the students they admit are likely to be successful future donors.

They reluctantly inflate grades and are tempted to tolerate cheating, because their students are quite clearly customers. I suspect that in many schools it’s easier to get bounced for unPC behavior than for academic reasons.

In an era of diminished job security, universities offer lifetime-secure employment for some people via tenure. Kind of unheard of if you started from scratch with some new organization or business, in which a guarantee of lifetime employment would be an intolerable anachronism. And on top of it, universities increasingly rely for teaching on a host of low-paid adjuncts.

I have no idea what the solution to all of this is; everything and everyone is different now. (And who I am to talk? I never thought I’d use so-called social media, and here I am.) In a way I liked the past better, but as with all else, we’re not going back there.

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Posted by runnerup | Report as abusive

In a valuation competition, when I heard one of my team-mates saying “it’s all about presentation, the quality of your analysis and your model is irrelevant”, I felt quite pathetic, not sure for this industry, or for the university education itself.

Posted by roy_wei | Report as abusive