Outsourcing in UK Universities

By Wendy Phillips, Elizabeth Alexander and Dharm Kapletia

As tuition fees and university funding remain the subject of hot-debate and the delivery of value for money for students rises up the political agenda, HEIs must appeal to a more discerning student ‘market’ whilst demonstrating the efficient and effective use of resources.  Successive UK governments have been driven by a market ideology to deliver policy changes with recent government initiatives calling for the use of commercial practices (e.g. outsourcing) by HEIs to deliver efficiencies, improve quality and support core strategies. The adoption of market-based mechanisms by HEIs contrasts with the state logic inherent to many HEIs, such as a collegiality, communities of practice, public goods and organisational autonomy that favours internal service provision.

In our Policy & Politics paper, we employ institutional logics to understand how HEIs have adopted organisational practices, specifically outsourcing, in response to recent policy changes. We engaged with top-level managers from UK HEIs to provide an insight into how HEIs deal with the complexity of institutional pressures and competing logics. Our work reveals that while a dominant market logic supports commercial-based practices such as outsourcing, this is still limited to peripheral activities such as accommodation and IT. We found that organisations employ competing logics in complex ways – by drawing selectively on the market logic, HEIs creatively integrate practices into existing structures and hi-jack the policy push towards outsourcing. For example, some HEIs have used student rankings not to legitimise outsourcing, but to strengthen internal service provision by citing ‘student experience’ as central to core activities. Our work found that many of the Post 1992 HEIs actively mobilise the state logic to protect core activities, limiting the extent to which managerial practices such as outsourcing can be implemented. Interestingly, in line with the state logic, core activities include not only research and teaching, but also social responsibility, and support to local enterprises and communities.

New cooperative solutions are emerging that bring together competing market and state logics. Collaborative sourcing models such as shared services and partnerships with social enterprises, local authorities and non-profits present novel strategic options where HEIs can selectively couple the dual logics allowing adherence to government policy and avoidance of internal organizational conflict. Governments can learn from our findings – conflicting logics limit the development of outsourcing practices, challenging the policy assumption that public service organisations can be operated as if they are businesses. Policy makers should question whether commercial-based practices will genuinely deliver performance improvements in public services, basing any policy changes on strong evidence.

The project presented in this Policy& Politics paper was funded by the Innovation and Transformation Fund. A final report of the project is available on the Efficiency Exchange.

If you enjoyed this article, you may be interested in British educational trajectories from school to university: evaluating quantitative evidence in policy formulation and justification by Ron Johnston, David Manley, Kelvyn Jones, Anthony Hoare, Richard Harris, University of Bristol, UK

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