Two Universities Team Up to Stay Alive, But Stop Short of Merging

Mergers and Acquisitions

Two Universities Team Up to Stay Alive, But Stop Short of Merging

By Daniel Mollenkamp     Jul 26, 2022

Two Universities Team Up to Stay Alive, But Stop Short of Merging
Eric Glenn/Shutterstock

Colleges don’t like to think of themselves as businesses, but a growing number these days are facing the harsh reality of falling enrollments and a struggle to make their financial numbers add up. That has forced several institutions to merge in recent months.

But two private universities are trying an unusual partnership approach that stops short of a merger while still aiming to restore financial health.

The universities—Otterbein University and Antioch University—will share costs and jointly manage graduate-level courses and career certificates and badges for adult learners, while hanging onto independence in their undergraduate offerings.

The hope is to bring in more revenue at less cost, without compromising their undergraduate operations, university leaders say.

It’s a kind of open relationship, something that they hope to scale by bringing in other institutions into what they are calling a “unique” university system. The two universities say that other private colleges have expressed initial interest.

Pockets of Innovation

Experts view the arrangement as an example of colleges thinking more collaboratively, as universities without instantly-recognizable brand names try to find a niche in a time of demographic changes and increasing competition from online providers.

This fledgling network of colleges isn’t the only example of new types of partnerships. Those in the space say there are pockets of innovation out there, trying to keep institutions from flatlining.

“I think college presidents are realizing that the business model that has guided higher education for, gosh, almost 250 years now, is broken,” says Jeffrey Docking, president of Adrian College in Michigan. Innovating is no longer a want, but “a need for survival” as it’s become too expensive to keep doing things the old way, Docking says.

Docking’s college is affiliated with Rize Education and the Lower Cost Models Consortium, a system for sharing courses across institutions. Other consortiums include TCS Education System, an integrated, nonprofit system founded in 2009, that allows schools to act collaboratively with shared services organizations.

Many cooperative models tend to focus on financial management—cutting down costs by managing back offices together, for example—or on a shared religious or geographic identity, like the Virginia Tidewater Consortium for Higher Education, which describes what it does as “regional cooperation.”

The Antioch and Otterbein approach, though, centers on a shared philosophy.

One way forward for small colleges is to create a distinctive program model. “What’s interesting about this” Mary Marcy, president of Dominican University of California, says, “is that rather than doing it independently, they’re actually partnering around a common set of values and mission around social justice and democracy.”

They’re reinventing in a partnership without either losing their core identities that stretch back into the abolitionist movement. And that’s possibly new, Marcy says.

Anti-Prestige?

Colleges like Otterbein can’t fall back on prestige to capture students. Its leaders say they wouldn’t want to.

“Otterbein has never really cared about prestige,” says John Comerford, president of Otterbein University. “One of our favorite phrases is: 'Do the right thing before it's popular.' And Antioch has a similar vibe.”

The focus on prestige reflects an overly competitive approach to higher ed, Comerford argues, which he says is really a form of “elitism.”

“The reality is that measures of prestige tend to measure exclusivity,” Comerford says, adding, “We'd much rather be inclusive and bring more people to higher ed, even if U.S. News won't reward us for it. We don't care.”

Instead, Otterbein intends to tap into underserved populations, he says, allowing institutions to work with adult learners who can step into workforce and societal needs, eliminating the need for such extreme competitiveness between universities.

Refocusing on Adult Learning

Part of this shift will bring corporations more into the fold as the colleges build out stackable credentials—shorter certificates that students can string together to earn more traditional degrees—as part of their adult learning programs, alongside undergraduate programs and traditional graduate ones.

College presidents and admissions officers are realizing that one reason people aren’t filing into colleges anymore is because of the availability of jobs for those with badges rather than a traditional four-year degree, Docking says.

To Antioch, it’s a refocus on adult learners and a way to keep growing relationships with companies. There’s a growing willingness of employers to train existing employees to move up within their organizations rather than bringing in new people, says William Groves, chancellor of Antioch University. This presents an opportunity to work with students to “tailor the programs to their needs” in a way that’s fine-tuned, Groves says. It’s also convenient for working adults, he argues.

Otterbein couldn’t really pull off its new strategy on its own because it can’t scale to meet the needs of employers, Comerford says. “But we hope this system allows us to have those conversations.”

Some professors say they welcome the chance to reach more adult and continuing learners. “The main thing that we're interested in is increasing opportunities for adult learners and graduate students,” says John Tansey, a chemistry professor and faculty trustee at Otterbein. The partnership, he adds, gives them flexibility in giving those students a way into good careers.

The new arrangement also fits with the institutions’ social-justice mission, since it engages underserved learning populations, university leaders claim. In addition to courses that may have actual content on those topics, expanding service to adult learners will “act out social justice,” university leaders argue, by increasing access to career opportunities.

This latest announcement may not be a “tectonic change,” Docking says, but it’s a signal to their communities that they’re going to use the internet and hybrid learning to change.

The two unanswered questions about this initiative are whether there’s enough student interest to make it scalable and whether it will make enough financial difference to keep the institutions afloat, Docking says.

 

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