27th June 2012: On Academic Freedoms

 

Mary-Helen Ward tweeted this morning about academic redundancies at Australian National University, La Trobe University and the University of Sydney. Ward points out that ‘academic freedom’ is often equated with a ‘job for life’ ethos that other industries do not have. “Redundancies are always about money. Managers have to manage with what they’re given. Where is academic freedom?” she asks, responding to a tweet from Thesis Whisperer, Dr. Inger Mewburn.

 

An older cohort of academics cite academic freedom as an essential part of their university’s social contract. For them, academic freedom is comparable to political ‘freedom of speech’ and to safely critiquing institutional politics and power. Academic tenure — or a ‘job for life’ — has been the institutional mechanism through which academic freedoms are purportedly secured and protected. ANU’s Rohan Pitchford has argued strongly that the University of Sydney’s academic redundancies will undermine institutional tenure and thus academic freedoms. Richard Hil and his complainant interviewees also express this view in the new book Whackademia, as does critical press coverage that focuses on the interaction of Federal Government policies, university senior management, and job markets.

 

I was studying Terra Firma Capital Partners‘ private equity deal for the music label EMI when University of Sydney announced their redundancies. I could see direct parallels between Terra Firma, GE’s ‘Neutron’ Jack Welch, and university management decisions. I had also been through similar experiences in publishing and university research/administration. I then wrote a blog post on what people could do to deal with University of Sydney’s decision rules. In the months that followed, this led to further posts on disruptive innovation in higher education; academic entrepreneurssuperstar economics; mailroom jobs; trading insights; academic skills externalities; and the academic-productivity debate. I sympathise with former mentors like Dr. Geoff Mayer at La Trobe University who are being made redundant. (Mayer’s class on the film noir In A Lonely Place gave me plenty of personal insights after a first relationship break-up: the kind of real-life experience not captured in a promotions committee assessment.)

 

Younger academics and administrators may have a different view on the link between institutional tenure and academic freedoms. Many in this cohort are in casual or administrative roles that do not have the same benefits that full-time academics receive. They have possibly gone through career changes and may not have the same expectation of a ‘job for life’ (or even for the next five years). They have found their freedoms in forums that are outside universities or that are marginalised in academia. They see professors with managerial skills who are promoted into management and other professors who don’t engage with the university community at all. They see Orwellian ‘freedoms’ like the ‘publish or perish’ norm that you assign your intellectual property to a profit-making international publishing conglomerate — or you don’t get promoted. They are in a ‘winner-takes-all’ workplace in which a small group either meet productivity benchmarks in the workload model or ‘game’ the system. And usually the people who benefit from this are the more established academics and elites.

 

This is why mentorship in universities for younger academics is so important. Yet it varies depending on how important it is to the senior academic or professor. The difference between the professoriate and younger academics can be likened to the shift from defined benefit pension plans to defined contribution pension plans in superannuation and private wealth management. Making institutional tenure the underpinning of academic freedom means assuming that universities will maintain your academic, high-paying role forever. As Ward points out, that doesn’t happen in other industries (Margin Call anyone?) and certainly not in a time of changes to government funding, sectoral hyper-competition, and economic uncertainty. It also allows some mid-career and senior academics to drift and to ‘game’ the system whilst their younger colleagues face tougher productivity demands.

 

There is plenty to question and debate in the recent redundancy decisions at several universities. The University of Sydney raised issues about decision rules, due process, fairness, transparency, and budget scrutiny. Other questions: What criteria underpinned the financial forecasts? What risk management systems were in place to meet specific financial targets, and why did they fail? Can the financial forecast estimates be revised? Are the performance goals in university strategic plans really feasible or are they just ‘strategy through inflation’? (Richard Rumelt raises this flaw about strategic planning in his book Good Strategy, Bad Strategy). Will the strategic plans survive their Clausewitzean contact with competitive ‘friction’? (No, Clausewitz argues they never do, no matter how well-meaning the strategic planners are – Henry Mintzberg‘s influential book The Rise and Fall of Strategic Planning also deals with this.) Is the strategic plan really unique or are our competitors thinking about the same positioning and value creation? Are we making budget and planning decisions that are really due to ‘institutional capture’ or outdated ‘images of the future’? Is senior management just reacting to short-term fluctuations in student numbers that will detrimentally affect our university expertise? What is the appropriate use and also the potential institutional misuse of research bibliometrics? What psychological support and employment outplacement services are being provided to those who accept or are forced to take redundancies? What are the ‘undiscussables’? What are the possible, preferable and potential futures that we are not exploring? (Maree Conway and Rowena Morrow have insights.) What will be the second- and third-order effects of our decisions, and over time? You can probably think of many other angles and questions that could be raised, debated and constructively explored.

 

Maybe there’s a vigorous debate in a professoriate forum that I’m not privy to. But I don’t see it in the public forums I have attended.

 

For a contrast to universities consider money manager Ray Dalio. He runs Bridgewater Associates which is the world’s biggest hedge fund (as defined by assets under management). Dalio is famous for his Principles (PDF) which outlines his personal management and investment philosophy. Dalio has given recent interviews to The Economist and Barron’s. He has given in-depth interviews in recent books by Maneet Ahuja (The Alpha Masters) and Jack D. Schwager (Hedge Fund Market Wizards) about Bridewater’s work culture. In Bridgewater, every management meeting is taped and made available to employees, who are incentivised to provide critical performance feedback to managers and directly, face-to-face to each-other. This is designed to thwart cognitive biases and decision heuristics that are critical to investment decision-making — I recommend Daniel Kahneman‘s book Thinking, Fast and Slow as a good primer. The debate is often around the computerised decision rules and mental models that Bridgewater uses to make over 100 investments in 15 uncorrelated revenue streams. Dalio’s employees don’t necessarily have the freedom to publicly debate Bridgewater’s investment decisions — but they appear to have more freedom within the organisation to help shape daily decision-making and culture.

 

Universities — senior management, professioriate, and younger academics — all clearly have a lot of catching up to do.

 

(Just look at how Google adapted Stanford’s academic workload model to its ’80/20′ time for innovation projects.)

CPRF08 Paper: Disruptive Innovation, Radiohead & Nine Inch Nails

I recently blogged about a presentation the 2008 Communications Policy Research Forum in Sydney on disruptive innovation in the music industry.

You can now download an Adobe PDF version of the PowerPoint slides here.

The refereed paper has been published in the Proceedings of the Communications Policy Research Forum 2008 (pp. 155-175 or PDF file pp. 179-199).  You can also download a local copy of the paper here.

The paper’s case study examines why Radiohead and Nine Inch Nails released their new albums as digital downloads.  I suggest a major reason why, and one that was overlooked by Web 2.0 pundits, is that each artist was in the ‘label shopping phase’ of a new contract and defected after negotiation problems with their major labels.  This fits a pattern in mergers and acquisitions: the major labels lost artists due to integration problems in a merger or acquisition.  Terra Firma Capital Partners has since partially confirmed this hypothesis: the private equity firm endures more post-acquisition integration problems with EMI and is fighting against government regulation of Great Britain’s financial services sector.

The paper’s data appendices contrast the artists’ strategies with signficant events and innovations in music industry contracts, conglomerate mergers and deal structures.  Somehow I missed U2‘s March 2008 deal with Live Nation: I found out about it in an October 2008 announcementGuns n’ Roses also finally released Chinese Democracy (MySpace audio stream): a new album that has taken 15 years, a rumoured US$14 million budget and 14 recording studios in New York, Los Angeles, Las Vegas and London.  I may write a paper on it . . .