Embrace a new business model to meet the needs of higher education today and tomorrow
The Urgency of Higher Education Transformation
It's no surprise to risk managers or business officers that the landscape of higher education in the United States is at a critical juncture. Navigating the present crisis(es) and building for the future is where we should strive to help the campus. We know our top concerns include student demographics, rising costs, and increasing skepticism about the value of a higher education degree. This leaves campuses facing an urgent need to respond—both internally and externally—to ensure they continue to meet the needs of students and the greater society. Calls for reform have grown louder, and there is a growing consensus that the status quo is no longer sustainable. Now, more than ever, institutions must find ways to adapt, innovate, and demonstrate their relevance in a rapidly changing world. What can we learn from those voices demanding change? Where do our shared priorities lie? What is our common good? Internally, we are good at critical thinking, and we must capitalize on that.
Diversifying and Expanding the Business Model
A key strategy for institutions looking to secure the future is diversification. Consider this part of your resiliency plan. Traditionally, many colleges and universities have focused primarily on delivering undergraduate and graduate education. However, with a growing demand for lifelong learning and an increasing need for up-skilling and re-skilling, higher education must expand its offerings. One potential avenue for diversification is the creation of dedicated offices for grants and funding, which can help institutions tap into non-tuition revenue streams. This idea was shared by one of the panelists.
Building out such a “Grants Office” is not only about securing additional financial resources but also about positioning the institution as a dynamic player in the broader ecosystem of workforce development. By diversifying the sources of funding and programming, institutions can better withstand the volatility that comes with being reliant solely on tuition and state funding.
Moreover, to succeed in this venture, higher education institutions must adopt the concept of business planning. There was a clear signal from the panel that it’s time to start thinking of our campus more like a business. This means approaching new projects or programs with clear, defined goals, outcomes, and metrics—essentially treating the development of educational services like a business would treat a new product launch (see recent checklist in the URMIA Library). As the Lumina Gallup study on the State of Higher Education shows, the value of education is there, but we must make the case for why higher education matters, particularly at a time when many question its economic return.
Elevating Internal Voices and Handling External Voices
For change to happen, institutions need to “amplify their voices” (the overall theme of the NACUBO conference). This is the prime time for leadership to engage actively and have boards be fully committed to the long-term vision of transformation. Too often, higher education leaders are caught in the weeds of day-to-day operations and are reluctant to speak out about the challenges their institutions face. They must take a bold stance, acknowledging the shortcomings of the current system while also being clear about their commitment to the mission of higher education. This transparency is the way to build the trust we are missing.
Mitch Daniels, former president of Purdue University and session panelist, shared an old adage, “No steak, no sizzle,” when speaking to the importance of having a compelling story to tell. Institutions cannot simply expect others to buy into the value of higher education without a clear, well-articulated narrative. A part of that narrative needs to include the ongoing need for internal reform: addressing issues such as cost, civil rights, and the evolving expectations of the workforce. Acknowledging these concerns, while outlining concrete steps to address them, will build trust with the public, students, and policymakers.
Responding to the Criticisms of Higher Education
Critics of higher education often point to rising costs, outdated curricula, and a disconnect from the needs of the labor market. Institutions must meet these criticisms head-on, starting with an honest evaluation of where they may be falling short. This means rigorously assessing the value that is being delivered to students—not just in terms of academic content but also in terms of post-graduation success. Are students being prepared for careers that allow them to thrive in the modern workforce? Are they equipped with emotional resilience, grit, and other soft skills that are increasingly demanded by employers?
Measuring success in higher education is an ongoing challenge, but it is necessary to remain accountable to both students and the broader community. Institutions must make it a priority to track outcomes such as employability, salary progression, and long-term career success. One tool to achieve this is better use of labor market data, allowing institutions to align their curricula with regional workforce demands.
Additionally, collaboration with K-12 systems is crucial. Pre-college preparation plays an essential role in shaping students who are ready for the rigors of higher education. Institutions should not shy away from taking responsibility for the full pipeline of student success, from middle school to graduate school. President Avis Proctor, William Rainey Harper College, shared a collaborative approach to student success, involving everyone from superintendents to college presidents, to ensure that educational institutions are better positioned to serve students.
Building Trust and Creating Lifelong Learners
The current loss of confidence in higher education demands a strong, unified response. It is critical for institutions to not only engage with students but also to reach out to communities and policymakers to demonstrate the enduring value of a college degree. The defense of higher education as a public good cannot rest solely on the shoulders of the administration. Institutions must recruit external allies, particularly from the business community, who can speak to the long-term benefits of education.
Higher education is about much more than producing degree-holders; it is about fostering lifelong learners and nurturing the potential of individuals to make meaningful contributions to society. The goal is to create a relationship with students that extends far beyond graduation*. Institutions should think about the long-term impact they will have on alumni and encourage lifelong learning—providing alumni with opportunities for continued education and professional development.
Supporting All Students
The demographic shift in student populations over the past few decades is also a factor that cannot be ignored. Today’s students are more diverse, with varying needs and challenges. Some face housing insecurity, food insecurity, or other barriers to success. Institutions must adopt a holistic approach that addresses these challenges, supporting students not only academically but also in their overall well-being. A more inclusive approach to student services, including healthcare, ride-sharing options, and community food banks, can help ensure that all students can succeed.
Additionally, understanding the needs of non-traditional students, those who may have life experience but lack formal credentials—is an area ripe for innovation. Offering more flexible, competency-based education options, which recognize and build upon students’ previous life experiences, can open doors for a broader range of learners.
Leading with Purpose and Mission
At its core, the mission of higher education must be transformation: transforming lives, communities, and society. Institutions must maintain a deep commitment to their mission even as they adapt to new realities. The “why” behind higher education should always be at the forefront of any change initiative.
To bring people along on this journey, it is essential to focus on the students and their stories of success. Students who have triumphed over adversity and made a difference in their communities should be lifted and given the opportunity to share their narratives with boards, legislators, and the public. These success stories can be powerful agents for change, helping to shift the narrative around higher education from one of failure to one of promise.
Conclusion
In this critical moment for higher education, institutions must step up to the challenge of reform. By diversifying their business models, amplifying internal and external voices, addressing criticisms head-on, and fostering lifelong learning, colleges and universities can secure a bright future for themselves and the students they serve. It is not enough to react to the current challenges; institutions must proactively shape the future of education, one that is inclusive, adaptable, and relevant in an ever-changing world.
In summary, higher education is at a pivotal moment, facing urgent pressures to adapt to changing demographics, rising costs, and public skepticism, all while reaffirming its value to students and society. Institutions must embrace innovation in business planning, funding diversification, and holistic student support, while elevating internal voices and external partnerships to build trust, drive transformation, and ensure long-term relevance.
Panelists for the NACUBO session included: Jonathan Alger, president, American University; Mitch Danels, former president, Purdue University; and Avis Proctor, president, William Rainey Harper College. It was moderated by Doug Lederman, co-founder and former editor of Inside Higher Ed.
This article was developed using a combination of human authorship and AI tools, starting with notes taken during the panel discussion. The author has curated, reviewed, and validated the content to maintain accuracy and reliability.
8/26/2025
By Michelle Smith, Executive Director, URMIA
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