Oxford University could shed its Brideshead Revisited image and become more like key Ivy League universities with a major review of its size and shape and appointment of an entrepreneurial vice-chancellor from New Zealand.
Auckland University vice-chancellor John Hood is the first outsider to head Oxford in 900 years.
He campaigned for higher fees in New Zealand and has long argued that universities must better exploit intellectual property.
His appointment, yet to be approved by congregation, comes at a time when Oxford is contemplating cutting undergraduate numbers in favour of postgraduates. Reform of the collegiate structure and a centralised admissions system are also on the cards.
Pro vice-chancellor Dame Fiona Caldicott said: "There will be an outcry from schools and parents if we decide to cut undergraduate numbers."
The university council is expected to make a position statement early next academic year.
An increase in graduate numbers would bring Oxford more in line with US Ivy League universities, which are dominated by postgraduates, led by faculty rather than colleges and, it is argued, are better able to compete in the research stakes.
Sir Walter Bodmer, principal of Hertford College, said it was a natural direction for a university such as Oxford if it was to stay at the forefront of world research.
But Oxford could not increase postgraduate numbers without affecting undergraduates because of pressure on funding and space.
Dame Fiona, who is chair of the Conference of Colleges and principal of Somerville College, said: "Oxford has always provided a fantastic undergraduate education. There is a discussion to be had about Oxford's role nationally and internationally."
Sir Alan Budd, provost of Queen's College and former chief economic adviser to the Treasury, said: "Oxford has to decide what sort of university it wants to be. Do colleges just want to become halls of residence or part of the postgraduate process?"
A consultation document on postgraduate/undergraduate numbers is being drawn up. And a new financial model that would better integrate college and university priorities has been set out.
At the moment, students apply to individual colleges and strong candidates are pooled to ensure that the best get in. Ministers indicated that this would be unlikely to satisfy the new access regulator.
The student union at Oxford last month voted in favour of a centralised admissions system where applicants applied to the university but stated a preferred college. Dame Fiona said: "In the longer term, we are considering a system where applicants apply straight to the university."
A university spokesperson said: "Our commitment to providing high-quality facilities for our graduate students is one of the driving factors behind developments. The university is also increasing the amount of graduate accommodation it provides."
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