Institutional challenges are the hottest topic for the higher education sector during the Covid-19 pandemic. Challenges are events that we have to face every day. What matters is not the challenges but how we overcome them. To remain competitive, institutions need not only change but transform the way they conduct their businesses. Therefore, when I was asked to deliver a talk on institutional challenges during a webinar on Malaysia Higher Education Recovery, I requested the topic be changed to institutional transformation. Due to the encouraging feedback, I decided to summarise the key points in this article. What I shared was based on my real experience in transforming a university; not merely opinions or theories I picked up from textbooks.
The Transformation
January 7 is always a special date, my birthdate. It was also the day in 2019 when I started my new journey as the Vice-Chancellor (VC) of Universiti Malaysia Kelantan (UMK). I was given a special task by Higher Education Minister to transform UMK, which was ranked at the bottom of the table into a respectable one. My initial reaction was like, gosh! this is a suicide mission. UMK is a young university, having been established only in 2006. Interestingly, there were already four VCs before me. I, an outsider, will be leading the university as her 5th VC. Looking at the number of VCs in a short period of time, UMK must be a special institution.
I took up the challenge and said to myself, why not, let’s do it! This will be an interesting journey. Indeed it turned out to be an interesting one that I will cherish throughout my life. Like mission impossible, when my term as VC ended in August 2021, UMK climbed up the rank from the bottom to be among the top ten public universities in the country. How did we do it? We did many things but I will summarise them into three key points: First, we did organisational scanning to determine its health; followed by a detailed check on its governance; finally formulated the winning strategy. While I will use UMK as an example, the transformation process can be applied to any Higher Learning Institution.
a. Organisational Health Check
In any institutional transformation process, having a good understanding of institutional health is the first and most important thing to do. It can be divided into four components. This stage will help us identify the problems and their symptoms.
Mandate and Aspiration
First, it is important to understand the mandate of the university. There are 20 public universities in Malaysia, and each was established with a special mandate. UMK, located in Kelantan, a state known for the entrepreneurial spirit among its people, was established with a special mandate to promote entrepreneurship education. Thus, UMK’s goal is to nurture graduate entrepreneurs and graduates with entrepreneurial mindsets across many disciplines. The next step is to understand the aspiration of the university’s Board of Directors. For example, what types of graduates and entrepreneurs that UMK want to nurture. Hence, it is critical to identify whether the strategy of the university and its achievements, past and present, are aligned with the mandate and aspirations of the university.
Baseline Data
Second, it is crucial to study the baseline data; identify the key performance indicators (KPIs) and their drivers; their current positions and where they are supposed to be. During the process, VC may receive various feedback and inputs from different groups of people. However, it is more important for the VC to refer to fact-based information than hearsay.
Performance Gaps
Third, it is important to understand the performance gaps; areas the university is performing and areas the university is struggling. Identify the pain points. It is also important to study the threats and opportunities. Again, all information must be fact-based. Asking a series of basic questions, why, will be very helpful during the process.
Organisational Culture
Finally, it is critical to understand the culture; work, morale, talent development, and probably the existence of little napoleons. To avoid bias, it is advisable to hire a consultant to conduct a study, and the key finding is to be reported directly to the VC. In the case of UMK, we found ‘trust deficit’ as the main challenge due to the frequent changes of VC.
b. Governance Check
The previous section discussed four components of the organisational health checks. The second phase of institutional transformation is governance check. During this process, it is crucial to understand the structure, process and mechanisms that influence the direction and control of the institution. The process will help us understand the probable causes of the problems identified earlier.
Organisational Structure
The organisational structure indicates the official reporting relationships and responsibilities that govern the workflow of an organisation. A weak structure may bring damage to the institution by creating unhealthy working relationships among the different ranks and a poor decision-making process. A good structure gives employees more clarity, helps manage expectations, enables better decision-making and provides consistency. It is also important to understand various working committees, their functions and responsibilities.
Policies and Guidelines
Policies and guidelines are crucial to help management make informed and justified decisions. Alas, these are areas where many public universities are lacking. In addition to the government rules and regulations that must be observed, public university as a statutory body, needs their own policies and guidelines related to investment, hiring, promotion etc. In addition, it is important to understand the roles of university BOD. Carrying the non-executive status, the chairman and board members should not meddle in the operational matters of the university. It is also crucial to note that university should never be used as a platform for a political agenda of any political party.
Strategic and Operational Risks
Strategic risks are risks that affect or are created by an organisation’s strategy and strategic objectives. On the other hand, operational risks are major risks that affect an organisation’s ability to execute its strategic plan. Unfortunately, many public universities fail to take into account the associated risks when planning their strategic plans.
Financial Management
Finally, it is crucial to study the financial strength and practice of financial management. This is particularly important when public universities are facing financial distress due to the continuous reduction in government funding. The practice of outcome-based budgeting can be helpful. Based on my experience, tying budget with expected outcomes can help the university manage its finances more effectively.
c. Formulating Winning Strategy
Once the organisational health and governance are fully checked and understood, the final phase in the institutional transformation process is formulating the winning strategy. It is like formulating the medication needed to cure the disease identified earlier.
Back to Basics
Strategies must be formulated with people in mind, thus creating strong ownership among the people. Strategies are meaningless without the support of the people who will execute them. The role of a VC is not only to set the target but showing the way to do it; what, why, how, when, and where. Merely creating a beautiful slogan is not sufficient. When I joined UMK, there are mottos or slogans like “Relevant, Unique, Different”, and “Entrepreneurship is Our Thrust”. When asked, what we do that is relevant, unique and different, and how does that translate into results, many fail to provide satisfactory answers. The number and quality of our graduate entrepreneurs are no different than other universities. We are still at the bottom of the table in most KPIs. Next, it is critical to creating a sense of urgency to change, by going down the ladder and meeting people via a series of town halls. It is advisable for the VCs to write their own speech. Speeches that come from the heart can win the heart of the people.
Focus
We are often trapped with a mantra that bigger is better. We tried to do too many things but ended up with very little success. Naturally, we love organising glamorous events though we realise they bring little impact. There is also no consistency. Therefore, it is crucial to focus on a few important things that can produce significant results in the shortest possible time using the least amount of resources. Whatever we do must align with the university mandate and aspirations, which are translated in the form of KPIs. For example, the guiding principle of UMK must always be entrepreneurship. In any institutional transformation process, it is also important to create quick wins to gain the trust and confidence of the people. Quick wins will create the feel-good factor which will create more significant wins in the long term.
Innovation and Collaboration
Innovation is key to success. University is the right place to inculcate an innovative mindset among staff and students, and that must be translated into action. The second is collaboration. I remembered Rafael Reif, President of Massachusetts Institute of Technology, when asked about the secret of MIT’s success, said only one word, collaboration. That is particularly true for a young university like UMK. Collaborating with renowned academic institutions and industry will provide a faster way to grow and create a good brand for the university.
Integrity
Integrity is the most important factor that should precede the other factors. Integrity must always be the highest priority. In any transformation process, the empowerment that comes with authority and trust is important but it must be accompanied by a clear responsibility and accountability. To do so, the university must have an effective reporting system in place, with a proper follow-up and follow-through, and that all decisions are made according to the policies, guidelines, rules and regulations.
The Results
This section shares the results of the transformation over a period of fewer than three years. UMK student enrolment rose from 9,000 in 2018 to 12,000 in 2020. The graduate employability rate jumped from 73% in 2018 to 91% in 2020. In line with the establishing mandate of the university, we increase our rate of graduate entrepreneurs from 2.8% in 2018 to 15% in 2020. Meanwhile, our community’s contribution to knowledge creation and innovation was also increasing steadily during the period. The number of publications, citations, and patents filed by our team increased more than three folds between 2018 and 2021. In terms of living up to global standards, we also did excellently well: UMK gained ISO 9001:2015 and ISO 45001:2018 certifications, and UMK became the first public university to be accredited by the Germany-based Accreditation Council for Entrepreneurial and Engaged University (ACEEU). As if to confirm the standards both internationally and locally, UMK won MOHE 2021 Award for Top Entrepreneurship University in Malaysia. During the covid-19 pandemic, UMK increased her bandwidth from a mere 1.1GB in 2018 to 9GB in 2021. Importantly, all were achieved with slimmer and lesser budgets.
Conclusion
This article discusses the process of university transformation. There are three steps: organisational health check, governance check, and formulating a winning strategy. Each step comprises several elements. It is based on a real case study of UMK. By implementing the steps mentioned in the article, the author managed to transform UMK from a bottom-ranked university into one of the best in the country. In a nutshell, institutional transformation is about putting the right culture, strong governance, and right strategy in place; and with strong leadership and a team of high integrity, nothing is impossible.
Note: Dr Azizi is a professor of accounting information systems at Malaysian Graduate School of Entrepreneurship and Business, Universiti Malaysia Kelantan with a strong passion for governance, technology, innovation and entrepreneurship. He can be contacted at azizi833@gmail.com
