Does digitalization in higher education help to bridge the gap between academia and industry? An application to COVID-19

Abstract

There are three different types of activities performed in higher education institutions that, taken together, form the components of a trilemma in higher education. These include traditional academic activities (research and teaching) and those that aim to transfer knowledge beyond academia (industry-oriented activities). The increased use of digital technology that has resulted from the replacement of face-to-face encounters with digital interactions, or digitalization, is leading to transformations in higher education and is affecting the trilemma; universities face new challenges, and opportunities are emerging. Drawing on lessons learnt from COVID-19, the author explores whether digitalization is helping to bridge the gap between academia and industry.

Keywords

Australia COVID-19 digitalization teaching trilemma for HEIs Triple Helix

The functions of higher education (HE) are shifting. While research and teaching are its two traditional core missions, the increasingly prominent role played by knowledge in economic development has opened up a third: the direct contributions made by universities to industry (Etzkowitz and Leydesdorff, 2000). I argue that the university activities related to these three functions – academic (research and teaching) and industry-oriented – form a trilemma in HE. At the same time, the increased use of digital technology that has resulted from the replacement of face-to-face encounters with digital interactions (hereinafter referred to as digitalization) is leading to transformations that both challenge higher education institutions (HEIs) and present them with opportunities. Therefore, in this article I examine whether digitalization is helping to bridge the gap between academia and industry. To do so, I draw on the transformations observed in the wake of the COVID-19 pandemic.

Márquez-Ramos and Mourelle (2018) recognized that future HE would involve both physical and virtual scenarios. Nearly two decades earlier, commenting on the way ahead for universities, Gerrard (2000: 320) claimed that ‘the concept of the fully developed virtual university […] is that a server will replace campus-based universities’. As a hybrid (virtual and face-to-face) working economy emerged, HEIs started to conduct some of their activities remotely; however, it was not until the outbreak of the COVID-19 pandemic that universities worldwide were forced to perform all their activities in a virtual format. Therefore, the scenario of ‘virtuality’ in HE, as described by Gerrard (2000) and Márquez-Ramos and Mourelle (2018), has become a reality – at least for several months in 2020. Although it is unclear to what extent virtuality in HE is here to stay, we are already observing transformations in HEIs, which I suggest are more pronounced in HE systems that are more dependent on market forces.

I focus the analysis on Australia for three main reasons. First, when considering the global context, it seems that the shift in favour of remote teaching and work is an Anglosphere phenomenon (Financial Times, 2020; The Economist, 2020). Second, there is an established Australian market for HE. Third, education is a key sector for the Australian economy: it is the largest service export, to which HE makes the largest contribution (see, e.g. Cavoli et al., 2020; Hall and Hooper, 2008).

The rest of the paper proceeds as follows. As digitalization is a global phenomenon, in the next section I contextualize the Australian HE system by means of a cross-country comparison that brings together elements from both the Triple Helix model and Clark’s triangle of coordination. In the subsequent section, I formalize the industry–research–teaching trilemma in HE and set the stage for a multidimensional analysis in a dynamic framework. In the section that follows this, I explore how digitalization is transforming HE, with a focus on the impact of COVID-19. I discuss five dimensions of the transformations, as well as how these transformations challenge HEIs and provide them with opportunities. The final section concludes the paper by confirming that digitalization may help to bridge the gap between academia and industry, setting out some of the key implications for policy and practice, and highlighting some limitations of the paper and avenues for future research.

The Australian HE system compared to other systems in the world

Existing HE systems are based on some form of the Triple Helix aimed at achieving an innovative environment that combines trilateral initiatives from the state, industry and academia (Etzkowitz and Leydesdorff, 2000). Universities engage in basic research, industries produce commercial goods and services and governments regulate markets. As interactions increase, each participating organization evolves to adopt some characteristics of the other organizations, and this process gives rise to hybrid organizations. Danson and Todeva (2016) highlight that effective Triple Helix constellations depend on both how universities blend with the regional institutional landscape and on the existence of regional authorities as coordination agencies. The interaction between global, national and regional aspects is important in the Australian context, where one can distinguish between challenges at the global (e.g., climate change), national (e.g., reconciliation) and regional levels (e.g., specific industries such as wine in South Australia or mining in Western Australia). Accordingly, as shown in Part A of Figure 1, I incorporate the regional aspect.

Figure 1.

A cross-country comparison of higher education systems within a Triple Helix model of university–industry–government relations. Source: Own elaboration based on Clark’s triangle, Etzkowitz and Leydesdorff (2000) and Angermuller (2017).

HE systems around the world can be characterized by the actors that ultimately make decisions about higher education: the state, the market or the academics. Therefore, every university system can be seen as a specific solution to the problem of the distribution of decision-making power. Going back to Clark (1983), this can be visualized by locating it within a triangle, with the three different actors at the corners. This enables the identification of relevant indicators for a cross-country comparison. For example, researchers are valued differently in different university systems (see Angermuller, 2017).

Part B in Figure 1 combines a regional Triple Helix and Clark’s triangle. It depicts three countries: Germany, France and Australia, which were the third, fourth and fifth largest destinations for overseas students before the COVID-19 pandemic (in 2005), behind the USA and the UK (see Hall and Hooper, 2008). Such a comparison can yield useful insights from a Triple Helix perspective. For example, Etzkowitz (2015) advocated for the abandonment of austerity policies in Europe when comparing European HEIs to US entrepreneurial universities. Also, Clark’s triangle can help to identify relevant elements to consider in different HE systems. For example, universities’ primary mission differs in different systems: in a state-centred model, the goal is to meet national socio-economic objectives; in a market-oriented model, it is the provision of services to ‘academic consumers’ and meeting market demands; and in a model of academic self-governance, it is academic freedom and long-term commitment to the production of knowledge (see Dobbins et al., 2011). Part B in Figure 1 also illustrates three key insights. First, traditional HE boundaries (as reflected by the triangle) may be overcome. Second, the future of HE may be an as-yet unknown scenario in uncharted terrain for HEIs. For Australia, this is indicated by part of the shadowed circle being located outside the triangle. Finally, a global shock may lead to growing divergence between different HE systems. In the context of this research, digitalization may represent a catalyst for such divergences because universities in systems closer to a pure market-oriented model may well start to follow paths that more closely resemble those in industry than will universities in systems that are more in line with a pure state-centred model.

The industry–research–teaching trilemma

Reforms in HE have led to the emergence of managerial universities, which focus on effectiveness and efficiency and give rise to notable changes in related organizational structures. Faculties must economize on scarce resources and fulfil more management tasks. Universities’ success in rankings becomes more important (Hagerer, 2019). They have to be able to attract funding and to transfer knowledge beyond academia. A key challenge is how to secure more funding, which normally arises from applied, professional and industry-oriented projects, while at the same time ensuring the necessary level in research quality to maintain reputation and prestige in national and international rankings. In addition, teaching is a key university function that, in the context of Australian HE, constitutes an important source of revenue. The difference between teaching revenue and costs (or teaching surplus) provides funds that can be used to pursue objectives that are not financially self-sustaining (e.g., research). Research is supported by large surpluses from university teaching in Australia: one dollar in every five spent on research comes from surpluses on teaching (this is based on conservative assumptions – see Norton and Cherastidtham, 2015).

I focus on three HE components: industry, research and teaching. Balancing the different activities in these components, even in a static and foreseeable university context, is challenging. Academics are under pressure to publish their research in prestigious publications while still performing their teaching activities. Greater pressure on academics may reduce their incentives to invest time in improving their teaching as they focus on their research outcomes. This, together with the fact that many universities have increased their involvement in engagement and impact activities (e.g., transmitting new knowledge to research end-users beyond academia, catalysing societal change and creating direct benefits for the wider community) and pressure to secure more funding from applied, professional and industry-oriented projects, creates a trilemma.

In this trilemma, the transfer of knowledge beyond academic activities, research quality and teaching quality are all desirable but cannot be easily balanced. There are three possible responses that balance the demands of two of the three elements of the trilemma, but which then jeopardize the achievement of more effective and efficient HEIs. The first is to opt for a mix that prioritizes the traditional university activities to achieve high quality in research and teaching. This option does not provide an optimal response to the fact that Australian universities need not only to conduct engagement and impact activities but also to generate additional income beyond teaching. The second possible response is to pursue a business model that centres on revenue-generating activities (i.e., industry-oriented and teaching). However, to successfully attract students and funding from research end-users, a university requires not only high teaching quality but also high research quality, which is key for maintaining a strong position in national and international HE rankings; in turn, these positions are heavily influenced by research outcomes and performance. And the third and final possibility is to set less ambitious targets regarding teaching quality, thus limiting the potential for developing a sound teaching reputation and community worldwide (e.g., through alumni networks), and missing out on an important source of income.

Assuming that these three components (industry–research–teaching) are interrelated,¹ they can thus be seen to constitute a trilemma in HE. From the trilemma, we learn that the effects of digitalization and the dynamics of HEIs cannot be explored by considering academic activities (research and teaching) in isolation. Therefore, I explore three additional dimensions of transformations that have arisen with digitalization.

Transformations in higher education arising from digitalization: The impact of COVID-19

In this section, I identify and discuss five dimensions of transformations: the academia–industry relationship; research (academic activities); teaching (academic activities); employment, management and technology; and finance and infrastructure. Table 1 presents a summary of the section.

Table 1.

Transformations, challenges and opportunities of digitalization.

Dimension	Transformations	Challenges	Opportunities
Academia–industry relationship	Fewer resources available	Enhancement of the relationship may have stalled	New collaborations between academia and industry (e.g., to bridge the gap between university curricula and industry needs)
	Need to innovate in particular topics		Enhanced collaboration in particular industries
	Growing role of research and enterprise in rebuilding regions		Growing role of HEIs in supporting the recovery of the post-COVID economy
			Increasing relevance of HE activities to local and national communities
	Looking beyond campus	Increasing global competition	Increasing demand for solutions to global issues
Academic activities: research	Networking	Losing opportunities for close collaboration	New collaborations emerge
	Networking	Losing opportunities for close collaboration	Cost reductions (e.g., international travelling)
	Research outlets and publishing	Reduced quality of publicly available resources	Fast, open publishing
	Research outlets and publishing	Reduced quality of publicly available resources	Cost reductions (e.g., subscriptions)
	Topics investigated	Diversion of funding towards topics with immediate value (e.g., coronavirus vaccine)	New research interests
	Less funding available for research	Reduced internal research capability	Externalization of research activities
Academic activities: teaching	Fewer international students	Reduced teaching surplus	Increasing focus on local, regional, and national problems in university curricula
	More online teaching	Time and resource constraints on preparing new materials	Democratization of knowledge and increased accessibility
	More online teaching	Reduced quality of publicly available resources	Democratization of knowledge and increased accessibility
	Change in students’ learning preferences (in topics and format)		Demand for new courses and academic programmes (blended and online)
	More unequal access to education	Broader digital divide
Employment, management and technology	Intensification in the use of high-tech devices	Increased control and competition	Increased collaboration
	New forms of employment and management	Deskilled workforce	Dealing better with change
	Intention to become a customer-driven strategic business	Cross-cutting organizational change	Implementation of more effective funding allocation approaches
Finance and infrastructure	Fewer international students and less teaching revenue	Obtaining funding for HE activities that are not financially self-sustaining (e.g., research)
	Increasing competition and concentration of HEIs	Potential for mergers in the HE sector
	Increasing competition and concentration of HEIs	Less access to quality HE for some
	Synchronicity in time and space is less important (work and study ‘anytime/anywhere’)	Greater work-related fatigue; stress and burnout of staff and students	Adaptability and flexibility
		Offices are less important	Cost reductions (e.g., offices rented)
	More support for ‘the jobs of the future’	Bias against some studies	Incentivized academia–industry relationship

The academia–industry relationship

The implementation of effective university–industry research partnerships remains a challenge in Australia (see, e.g. Sciacca, 2019). The trilemma in HE has highlighted the difficulty of balancing its three components in a static framework. In a dynamic framework, we can conceptualize how a global shock may affect the academia–industry relationship. In this regard, the international mobility restrictions caused by the pandemic reduced the teaching surplus in Australian HEIs and there is now less funding available in the system. Given that the enhancement of the university–industry relationship has rested on the assumption that there is considerable resource available (Grigg, 1994), this relationship may have stalled. At the same time, when there are fewer students in the system strengthening industry–research collaboration may be a feasible response to the trilemma. Also, with regard to industry–teaching collaboration, COVID-19 may have underscored the existing gap between graduates’ skills and competencies and those required by industry. Consequently, HEIs may prioritize efforts to bridge the gap between their curricula and industry’s needs for work/career readiness. COVID-19 may have also enhanced collaboration to investigate and innovate in particular areas. In the pharmaceutical industry, for example, institutions that are usually competitors are now collaborating (Ledford, 2020). We are witnessing how research and enterprise/industry are playing a growing role in supporting the rebuilding of regions. Therefore, universities may play an important role in supporting the recovery of the post-pandemic economy (see, e.g. Group of Eight Australia, 2020). In this vein, universities may become more relevant to local and national communities (Witze, 2020). At the same time, there is an increasing need to ‘look beyond the campus’ and HEIs may become even more crucial for meeting global challenges (see, e.g. the podcast on ‘Universities and climate’ by Pietsch, 2020). Also, in a digital global world, HEIs face competition that is no longer only local, regional or national, but global.

Academic activities (research)

COVID-19 has impacted those HE academic activities that have traditionally been performed in face-to-face environments. It has transformed the way of networking (Mallapaty, 2020; Viglione, 2020) and publishing (Callaway, 2020), as well as the topics investigated (Gibney, 2020). More efficient processes may be established through cost reduction (e.g., in international travel and subscriptions) and open and rapid publishing; but quality issues may emerge with publicly available research that has not gone through a thorough peer review process. At the same time as we may observe the emergence of new research interests, researchers may face greater difficulties in securing funding for topics that do not offer immediate value to the community or society as a whole. Lower teaching surpluses may lead to reductions in internal research capability and at least part of it may be externalized.

Academic activities (teaching)

Universities have fewer international students and have shifted many classes online, and students’ learning preferences are changing (Gibney, 2020; Witze, 2020). The decline in the numbers of international students, and the consequent reduction in the teaching surplus, may lead to a re-focusing on local, regional and national problems in university curricula. Staff in HEIs are developing new online resources and new academic collaborations are emerging. The growth in publicly available online resources may help to ‘democratize’ knowledge by making it more accessible (Márquez-Ramos and Mourelle, 2016); however, academic staff face constraints (e.g., in terms of time and resources) that impact the quality and effectiveness of these new online materials (Longhurst et al., 2020). The needs and expectations of students in the future will differ from those of students in the past (Márquez-Ramos and Mourelle, 2018). New types of students are already emerging, such as those with concerns about sustainability and the carbon footprint of their travel (Western Union Business Solutions, 2020). COVID-19 has modified perceptions about distance education and there is now greater acceptance of remote activities (see, e.g. Canvas, 2020). The changes in students’ learning preferences in terms of both topics selected and the format of delivery (through an improved perception of online teaching) may increase the market demand for new (blended and online) courses and academic programmes. But with COVID-19, and hence distance learning, there is evidence that more students than before are falling behind in their studies (Canvas, 2020). Also, due to unequal access to technology, we have observed rising inequality in terms of, for example, student success and engagement, or unconnected lecturers wanting to learn how to apply e-learning techniques for use in their own classes. Inequalities between elite and marginalized lecturers, students and researchers may be exacerbated because unequal access to education persists, even in developed countries like Australia (see, e.g. Hillier, 2018), broadening the digital divide. Overall, students’ academic performance (in terms of, e.g. success and academic progress, work/career readiness, etc.) may be negatively impacted if digitalization continues to intensify inequities in HE.

Employment, management and technology

The transformations in the dimension of employment, management and technology arose with the digital economy. Accordingly, this dimension includes trends in industry that existed before COVID-19. For example, Ramaprasad and Johnson (2000) envisaged how electronic medicine would transform health care. With COVID-19 there has been an intensification in the use of high-tech devices in HE. For the efficient implementation of digital technologies, HEIs may challenge the foundations of the (permanent, full-time) employment relationship, and open up new possibilities not only for competition and control over workers, but also for collaboration. New forms of employment may transform the traditional relationship between employer and employees in HEIs. These new forms of employment, together with new management approaches that, for example, increase control over staff, could end up de-skilling the workforce (Degryse, 2016). However, these transformations may help HEIs to deal more effectively with change. If HEIs opt for a so-called digital transformation, a radical transformation towards a customer-driven strategic business model might be adopted by university managers, which would result in cross-cutting organizational change (Bloomberg, 2018). Transformations in this dimension interact with transformations in other dimensions. A case in point is the interaction with finance and infrastructure, as organizational change may impact funding allocation. These reforms can follow different approaches. In this context, Tahar and Boutellier (2013) distinguish between ‘high-touch’ approaches which follow a more qualitative and negotiation-based strategy and put the emphasis on strategic choice making, and ‘high-tech’ approaches which are quantitative in nature and use a predefined formula to generate competition. These authors argue in favour of high-touch approaches for funding allocation as, according to their findings, they are better suited to HE domains.² As high-touch approaches rely on information from qualitative reports, face-to-face meetings and discussions to make well-founded decisions, COVID-19 may well have had an impact on the possibility of performing some of these activities. Consequently, high-tech approaches might be prioritized.

Finance and infrastructure

COVID-19 has had a significant financial impact on research due to the decline in the numbers of international students (Nogrady, 2020). The long-term consequences for research funding will vary by country. Although research may remain intact in other countries, Australia warned that 7,000 university research jobs were at risk in 2020 (Subbaraman, 2020). With COVID-19, we have seen that physical spaces are less important, and working from home is not only possible but often preferable (Iansiti and Richards, 2020). HEIs may benefit from cost reductions – for example, in the amount of office space needed. Synchronicity in time and space is becoming less important, and this may increase adaptability and flexibility (e.g., in terms of arrangements for meetings and working hours). However, it may also result in greater work-related fatigue, worsening the perceived work–life balance (Palumbo, 2020). This trend was observed with the digital economy before COVID-19; in this vein, Degryse (2016) recognized that the intensification of ‘anytime, anywhere’ work might blur the boundary between private life and working life, leading to stress and burnout. If COVID-19 results in a permanently more digitalized HE system, we may observe an increase in the concentration of HEIs in urban areas with good facilities. There may be an increase in the number of mergers among HEIs to take advantage of economies of scale in order to produce more HE products and services at lower costs. An increase in competition between and the concentration of HEIs (see, e.g. Márquez-Ramos and Mourelle, 2016, 2018), may limit access to high-quality HE for different groups of students (e.g., those in rural areas). At the same time, HEIs with a high reputation may focus on preserving their exclusivity, raising the prices of their academic programmes to differentiate themselves from lower-cost providers. Government regulations that affect the financial structure of HEIs are also transformative. In this regard, the Australian government has recently introduced changes to incentivize study for ‘the jobs of the future’. Following these changes, the cost of a social sciences degree will more than double, while nursing, mathematics and teaching degrees will become cheaper (ABC News, 2020; Duffy, 2020).

Conclusion

I have presented a trilemma in higher education that includes the three components of industry, research and teaching. By considering a dynamic framework and drawing on the lessons learnt from the COVID-19 pandemic, I have explored transformations in HE that have arisen from digitalization. Consideration of the trilemma illustrates the interrelationships among its components and, therefore, the fact that transformations in academic activities cannot be explored in isolation. I identified three additional transformations that go beyond the traditional domains of research and teaching: namely, the academia–industry relationship; employment, management and technology; and finance and infrastructure. Transformations were then linked with challenges and opportunities for HEIs.

Two key insights gleaned from this analysis are (a) that digitalization may help to bridge the gap between academia and industry and (b) that COVID-19 has accelerated existing trends in industry and even in HE. As this study focuses on Australia, it may not be possible to generalize some of the insights gained to other HE systems. Also, Australia has certain economic and geographical characteristics that it does not share with other countries. Specifically, it is strongly dependent on a few large ‘neighbouring’ countries, especially China, and is highly specialized in a few sectors, particularly primary industries and education services. Applicability to other countries is left for further research. Regardless of these limitations, however, it seems that the transformations identified call for a more symbiotic relationship between academia and industry to meet market and societal needs. As a consequence, universities in some parts of the world may well start to follow paths that more closely resemble those in industry.

Footnotes

Acknowledgements

I am grateful for the feedback provided by two anonymous referees and the Editor in Chief, John Edmondson, and also by Benedikt Heid, Estefanía Mourelle, Richard Pomfret, and virtual participants in the 6th International Conference on Higher Education Advances (HEAd’20) held in Valencia, Spain, in June 2020. I gratefully acknowledge the financial support from the Australian Research Council and the INTECO research group.

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This work was supported by the Australian Research Council (DP190103524) and the INTECO research group (PROMETEO2018/102).

ORCID iD

Laura Márquez-Ramos

Notes

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