Entrepreneurialism in Universities and the Knowledge Economy

An analysis of how higher education is responding to current challenges impresses Huw Morris

April 16, 2009

How to develop entrepreneurialism in universities has been a recurring theme in higher education policy for more than 25 years. In the UK, from the Enterprise in Higher Education initiative in the late 1980s through to the Lambert and Leitch reviews in 2003 and 2006, and more recently in the Economic Challenge Investment Fund, university managers have been encouraged to develop employability among their students and to encourage growth in businesses.

In the late 1990s, Burton Clark, the distinguished US professor of higher education, published the landmark study Creating Entrepreneurial Universities: Organizational Pathways of Transformation, which outlined how five European higher education institutions had responded to cuts in government funding by increasing the amount of money they obtained from non-governmental sources. A decade later, Michael Shattock, the former registrar of the University of Warwick and an interviewee of Clark for that study, offers his latest views on what makes an entrepreneurial university.

The research in this volume is more extensive and detailed than any previous such endeavour, with case studies of public and private higher education institutions in England, Finland, Moldova, Poland, Russia, Spain and Sweden. The European Universities for Entrepreneurship (EUEREK) project team that conducted this study, and variously authored the book's 11 chapters, chose these particular institutions because they wanted to examine how entrepreneurialism flourishes and is inhibited in different national settings. The results of the study are impressive and extensive in their detail, much of which is contained in more than 50 reports on a companion website.

The conclusions that emerge are complex and at times counter-intuitive. European universities, it is argued, "are more entrepreneurial than is often thought as judged by their performance in diversifying their funding base, exploiting their research in the wider world, (and) extending their teaching to new markets and in regional engagement". However, there are also marked variations in the extent of this entrepreneurialism. For example, between 1994 and 2004, the autonomous UK-based London School of Hygiene and Tropical Medicine gained more than two thirds of its funding from research and third-stream activities paid for from non-governmental sources. Meanwhile, the more narrowly focused Spanish institutions received less than 3 per cent of their funds from non-teaching activities. The staff in the private sector institutions in the UK, like their counterparts in other countries, focused almost wholly on teaching and committed only 1 per cent of funds to research.

Perhaps unsurprisingly, following the professorial focus and economistic tenor of the evaluation in this text, the universities displaying the most entrepreneurial characteristics were found to provide offices for academic intrapreneurs. As several of the authors emphasise, these individuals thrive when their efforts are admired, but they also need autonomy, collegial models of governance, financial incentives and confidence that their institutions will invest in academic infrastructure to support them.

However, as seductive and appealing as this analysis at first sight appears, perhaps it lacks due attention to the costs and benefits as well as the incomes associated with an entrepreneurial approach. In the market for academic research, teaching and third-stream activities, it is not just where the money comes from that matters. Of equal or greater importance is what that money is spent on, how effectively, efficiently and ethically it is used and what benefits it brings to students, citizens and the environment within which the university operates.

As universities across the continent once again prepare to rein back expenditure in response to pressure on the public purse, this time caused by the failures of an overly entrepreneurial Anglo-Saxon global financing system, we need to consider what we value in entrepreneurialism. And, more specifically, we must decide what part social and environmental issues, as well as academic and economic issues, should play in accounts of this activity. Perhaps these questions could form the focus of an equally extensive follow-on study.

Entrepreneurialism in Universities and the Knowledge Economy: Diversification and Organizational Change in European Higher Education

Edited by Michael Shattock

The Open University Press

256pp, £70.00 and £28.99

ISBN 9780335235704 and 5235711

Published 1 December 2008

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