Football analogies

Nick Petford, vice-chancellor and CEO of the University of Northampton, has published a piece on the Guardian’s HE Profession Network making a comparison between higher education and the world of professional football.

Anyone who has seen me speak over the last 18 months will have heard a version of this analogy. Petford makes the necessary first decision – to view universities as businesses – and identifies three themes on which to hang his comparison:

• commercialisation,
• internationalisation (different flavours of private equity are already at the periphery and benefiting from government support)
• and how ‘spectators’ or fans fail to see what’s really going on.

In fact, the analogy can be pushed further, especially if we look back to the early nineties, the formation of the Premier League, and the introduction of the Sky TV cash. Money moved around professional football differently after that. The new funding regime and its accompanying market in undergraduate recruitment achieves something similar – changed flows and investment opportunities.

So here are a few more points to consider:

Corporate form & group structures

In HE, we are already seeing a drive to change corporate form.

Following the example of Tottenham Hotspur, almost all high-level professional football clubs had created a holding company by the mid-90s. This allowed investors and executives to avoid the FA’s rules barring paid directorships and limiting the dividends that could be distributed to owners and shareholders. The ‘club’, now a subsidiary, met these regulations, the holding companies didn’t need to. The regulators were ‘gamed’.

New HE group structures are designed to achieve ‘tax efficiency’, autocratic flexibility for the executive, and value extraction by private equity.

Chairmen

If you look closely, you can already find HE’s equivalents of Peter Ridsdale and Ken Bates. Without governance arrangements adequate to the new HE terrain, vice-chancellors face even less scrutiny than the dodgy characters who have blighted football.  Watch out for overambitious strategies built on borrowing!

Administration

Owing to spectacular mismanagement, over 50 UK professional football clubs have gone into administration since the early 90s, despite the increased sums flowing around the game. Some of these have gone bankrupt and been wound-up, with Rangers FC the most recent high-profile example. The government’s 2011 HE white paper stated that the coalition was no longer prepared to act as backer of last resort for universities.

The FA

With HE’s regulatory structure in limbo and the various quangos being hacked into shape to make allowance for the lack of primary legislation, we shouldn’t be surprised if their performance is as poor as the FA’s was back in the 90s.

Spectators and fans

In the last twenty years, fans have seen ticket prices increase at startling rates, but a cheaper, mass alternative to the ‘live experience’ has been made more widely available via television. You can create your own analogies using ‘tuition fees’ and ‘moocs’.

All the dangers that may befall universities can already be seen in the last twenty years of UK football. Time to start following the money, reading the accounts, and considering the best way to resist misjudged corporate strategies.

Note: many of the links here are to David Conn’s football coverage. His The Beautiful Game sets out many useful case studies for thinking about the new risks.