What’s On My Mind: Corporatization at the great American research university

"What's On My Mind" illustration of Chancellor Nicholas S. ZepposA university’s mission—to teach, discover and serve—is timeless. Yet universities change. Some changes are intentional while external forces drive others. One measure of a university is how well it manages such changes without sacrificing its mission and values.

From my earliest days as a faculty member, I’ve sought to understand the trends that buffet Vanderbilt and similar universities. One I noticed from the start was the concern over “corporatization”—the ways in which universities have adopted structures and behaviors once associated exclusively with business.

In my observation, the forces making Vanderbilt and our peers subject to such criticisms are multiple and interrelated. Here are some of them:

Regulation. Like all universities, Vanderbilt is regulated by multiple government agencies. A study we conducted for the U.S. Senate concluded that 11 percent of our budget is spent directly or indirectly on regulatory compliance.

Risk management. Our highest responsibility is to keep our students, faculty and staff safe. We have identified almost 1,000 different risks in our operations. Failure here can lead to serious injury, death and financial losses, and can impair our ability to excel in meeting our mission. So we must reduce risk where we can.

Technology. No newsflash here: The advent of computing, the internet and mobile technology has remade how we do nearly everything.

More money. When I came to Vanderbilt in 1987, our budget was $450 million. It is now about $1.2 billion. We have more revenue sources that are inherently more complex. More money is at stake, and small errors can result in huge losses. So our controls must be more robust.

Commercialization. From athletics to patents to continuing education programs, universities can monetize what they do in ways undreamt of a few generations ago.

Internationalization. Students, faculty and staff now travel the world to teach, learn and do research.

Market forces. Our global presence isn’t just driven by our work. It’s a necessity for a university that now competes globally. That means more regulation, more risk and a bigger playing field that changes more quickly. As market forces shift, we have to nimbly respond in ways we did not when we were simply a standout regional or national university.

Expectations of efficiency. Government agencies and others with a vested interest in our work demand that we use resources efficiently—despite the fact that, for reasons too often ignored, universities operate under special economic principles.

All of these factors contribute to the perception of “corporatization.” And all are double-edged swords. Take regulation. When universities fail in their basic responsibilities, the government should intervene. Inequality, in particular, has led the federal government to rightly demand, through Title VI and Title IX, that universities do better. But many other regulations are unnecessary and too costly and impose onerous responsibilities on staff, faculty and students. “Effort reporting” and other strings tied to federal funding are one example. Some studies suggest that faculty spend almost 20 percent of their time on grant administration.

Commercialization, too, offers possibility and pitfalls, as former Harvard president Derek Bok showed so well in his book, Universities in the Marketplace: The Commercialization of Higher Education. The increased capacity for universities and faculty to profit from their work has generated needed revenue, but also has raised fair questions about the compromise of mission and values.

Vanderbilt is not unique in wrestling with these questions. But we can be different in how we address them.

Over the past decade—in admissions, in the strength of our faculty, in our financial health and more—Vanderbilt has exceeded all reasonable expectations in ways admired by our peers. We have done so, I believe, because we commit ourselves to our mission and work collegially.

I propose that we commit ourselves, through that same collegial process of inquiry and collaboration, to understanding “corporatizing” forces here and to ameliorating their adverse effects. Indeed, conversations on some of these topics have already begun. I’ve spoken to the Faculty Senate and have worked closely with our student leaders. And our staff is unparalleled in its commitment to our mission and in its openness to working cooperatively across Vanderbilt. With that dedication, we will continue this conversation at every level of our campus, developing processes for us both to improve our work and also to ensure the vital communication and dialogue that is the hallmark of a great university.

A university in the 21st century may not be able to avoid “corporatizing” forces. But we can take every step to ensure that such pressures do not leave us at cross-purposes with our mission and values. We can do what outside forces make necessary, but we can do it thoughtfully and innovatively, with who we are and what we stand for front and center. We can do it, in short, The Vanderbilt Way.