Merger Watch: Mergers in higher education are global. Here are lessons for American colleges.

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Ricardo Azziz held many leadership positions in higher education and led the merger that resulted in Georgia Regents University, now Augusta University. He is director of the Strategic Partnerships in Higher Education Consulting Group.

This is the first in a series of regular Merger Watch opinions he writes on corporate restructuring in higher education.

A photo of Ricardo Azziz's head

Authorization granted by Ricardo Azziz

Two of Japan’s most prestigious universities sign a pact to merge. hundreds of students protest against the decision to merge their university with two others in Yerevan, the Armenian capital. In Scotland, students and the wider community are being asked to weigh in on a proposed merger of three colleges create an “anchor institution” within the University of the Highlands and Islands.

What can we learn from this news? First, that mergers in higher education are a global phenomenon. Second, mergers continue in many countries to improve global competitiveness. Third, mergers inevitably generate opposition.

The worldwide phenomenon of mergers in higher education has, in many ways, presaged the expected consolidations in colleges in the United States. In recent decades, major merger initiatives have been reported in Northern Europe, the UK, Ireland, France, Belgium and Romania. , Greece, Australia, South Africa, Russia, Ukraine and China.

Just in Europe, almost 100 mergers or alliances took place between 2000 and 2015. In South Africa, mergers focused on reducing the number of universities and universities of technology (“technikons”) in a post-apartheid effort to improve access and equity, improve economies of scale and strengthen institutional sustainability and differentiation.

Between 1960 and 1991, Australia undertook what can be considered three waves of mergers aimed at improving programmatic and financial coordination. In China, widespread smelting activity began in the 1990swith more than 400 mergers involving nearly 1,000 public higher education institutions in 2005.

Although there may be substantial differences in educational policies, structures and higher education portfolios in different countries, there are nevertheless lessons that can be learned from the experience of international mergers.

First, the international higher education community has recognized a factor that often seems to elude US college boards and government officials: in general, bigger is better. Better in terms of the opportunities and access that can be offered to students and faculty, better in terms of efficiency and sustainability, and better in terms of local and international competitiveness. While there are some very successful small schools, most small institutions are more financially fragile and unsustainable than their larger counterparts and competitors. Size matters.

Second, mergers in the international arena aim to create comprehensive and diverse universities with greater capacity to offer transdisciplinary teaching and research programs and greater potential for increased international prestige. Mergers enhance competitiveness.

Third, mergers are often difficult and complex, and not without vocal opposition. This opposition must ultimately be dealt with by the leaders responsible for the school’s organizational structure – its board of trustees. Internationally, mergers in higher education are often advocated and encouraged by local and national government leaders. In the United States, the most successful and broad-ranging merger initiative to date occurred within the Georgia University System, which followed similar mergers within the Georgia Technical College System. Their success has been driven by state governors and technical college and university system boards. The success of a merger cannot happen (or even be contemplated) without the full and unwavering commitment of the institutions’ boards and management.

As economic stressors continue to increase, student demographics and government funding priorities change, and the need for local and global competitiveness grows, the pressure to shore up institutions in an industry plagued by capacity surplus will continue – in the United States and around the world. We would do well to listen and learn from our international colleagues, who have understood that size and competitiveness matter – and that bigger is better, in general.

Furthermore, we must recognize that successful consolidation cannot take place without the full and unwavering commitment and support of Boards of Directors and, in the public sector, senior civil servants.

Helen D. Jessen