Restructuring ‘too often adding cost rather than removing it’

The need to outsource services following redundancy programmes may be increasing universities’ costs rather than lowering them, as well as impacting staff productivity, a report warns.

The Invisible Majority: Professional and support staff and the future of UK higher education examines the challenges faced by university professional services staff, and argues that such staff go underappreciated in the sector.

The paper by the Higher Education Policy Institute (Hepi) and AHEP Consulting is based on two surveys completed by 450 respondents as well as analysis of 50 institutional annual reports and interviews with senior professional services leaders. It comes as professional services staff have been increasingly hit by job cuts and major restructures, as universities look to cut costs.

It notes that institutions “routinely” hire consultancies for these restructures as well as change management specialists, however, these processes often introduce additional management layers, “adding cost rather than removing it”, while “productivity drops as staff focus on what change means for their own jobs rather than on the work itself”. 

“The deeper problem is a cycle of underinvestment. Institutions cut training budgets as an easy saving, then discover they lack the capabilities they need to deliver more effective services. Because they have not developed skills internally, they buy them externally at higher cost,” it says.

This was flagged as particularly an issue when it came alongside a university’s attempts to implement wider institutional change, including digital transformation. 

One respondent told the report: “We have a lot of broken processes and inefficiencies. Every time we make salami-slicing cuts to the staff, it gets worse…We CAN unlock that capacity, but it requires continuous improvement roles – which have been made redundant.”

Several senior managers told the report that institutions “underestimate” what active contract management requires when outsourcing services, and “how problems that emerge mid-contract can cost more to resolve than the original savings were worth”. 

Meanwhile, the report finds that major restructures are impacting negatively on staff morale. Two-thirds of respondents say change and uncertainty over the past five years has affected them negatively, and three-quarters of the survey respondents reported sustained high work intensity. 

Many respondents (43 per cent) said that relationships, team culture and communication had worsened over the past five years, and that the uncertainty created by restructures has fallen hardest on the lowest-paid workers, which tend to be women or those from ethnic minority backgrounds.

“Work has become fragmented, reactive and deadline driven. Jobs have expanded without redesign. Career frameworks are absent or ineffective. Too often, change is done to staff rather than with them. Management quality varies sharply,” it says.

“Most institutions respond to financial pressure through restructuring, hiring freezes and outsourcing. These achieve short-term savings but dismantle the capabilities needed for the future.” 

The report recommends that universities ensure that there is “structured consultation where staff input shapes decisions”, as well as establishing clear career pathways and training opportunities, and create fair and transparent reward structures for such staff. 

Nick Hillman, Hepi’s director, said professional services staff “keep higher education institutions running” and that their roles are “more important as regulatory burdens and the expectations of students, society and policymakers continue to increase”. 

“Yet professional service roles are still often performed under the radar, meaning the staff that fill them can be taken for granted. This can result in unclear career progression routes and insufficient training as well as heightened risk of redundancy.  

“It is time for a new and more professional approach to professional services staff – one that more fairly reflects their true worth and which delivers benefits for all.”

Amanda Owen-Meehan, consulting director at AHEP Consulting, the consulting practice of the Association of Higher Education Professionals, added that reducing the cost of professional services is “reasonable in the present climate”. But, she said, “it is a different question from asking what the strategy depends on and how to build that within the money available”. 

“The first question produces a smaller workforce. The second produces one that can do what is asked of it. And none of this is an argument that professional services matter more than teaching and research. The two workforces succeed or fail together.”

Raj Jethwa, chief executive of the Universities and Colleges Employers Association, said that he “welcome[d] much of the report’s contents” and said that the organisation had published a range of resources to help address issues such as contractual issues and workload management.

juliette.rowsell@timeshighereducation.com