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As sources of wisdom, academic institutions could be smarter

Academic institutions are renowned for producing knowledge that runs world economies in all the continents.  That the Silicon Valley firms among other Fortune 500 firms were born in academic institutions such as Massachusetts Institute of Technology, Stanford, Harvard, and Princeton Universities for the US economy is not an overstatement. The UK boasts of University College London, Oxford, Cambridge, and Manchester Universities among others, while China Europe International Business School, Tsinghua, and Peking Universities among others continue to benefit China. HEC and INSEAD in France as well as IESE Business School and ESDE Business School in Spain, the latter in which I got my Ph.D., are top business schools in Europe.

Here at home, Strathmore University Business School and University of Nairobi, among others, continue to produce leaders that run the Kenyan economy. Among these are Joshua Oigara and Martin Oduor Otieno. The former is the CEO of Kenya’s leading bank and an alumnus of Strathmore University and INSEAD Business School, while the latter, an alumnus of University of Nairobi and Harvard Business School, currently chairs the Board of East African Brewers – the leading brewer in East Africa. These leaders took courses such as Strategic Innovation, Business Disruption Planning, Crisis Management, Business Continuity Plans, Scenario Planning, Proactive Decisioning, Financial Austerity, name it. Evidently, the Business schools have provided these giants with tools to effectively deal with the covid19 pandemic in their institutions.

However, the ongoing Covid19 pandemic has exposed the curse of academic institutions.  They are not as proactive as they teach us to be, and cannot take the very medicine they prescribe to the corporate world or even implement these agility strategies. Harvard University, for instance, has been receiving Federal Relief Funds. Recently, after President Trump criticized them for receiving it despite its large endowment valued at $41 billion before the pandemic, Harvard announce they they would not accept the $8.6 million Emergency Relief Package for Higher Education. If Harvard with such an enormous endowment fund needed federal relief, the situation of our Kenyan academic institutions that have neither endowment funds nor government relief funds is left to your imagination. It is even worse for private academic institutions since they receive no funding from public coffers. Rather, they rely mainly on school fees from students who are not paying now, as most of the institutions have no capacity for proper virtual learning, examinations and even graduation.

This lack of school fees payment has led to reactive measures such as deferring of staff salaries and laying-off of staff among others, by the same universities that continue to teach us the need for portfolio and revenue diversification. Ironically, Kenya universities  are operating at an average of 98% reliance on school fees.

How can this be the case and yet most of these institutions boast of  more than 50 years of existence? The answer lies on the structure of Academic Institutions, particularly on the separation of roles between Teaching (Faculty) and Non-Teaching (Administration) StaffFaculty gives strategic insights while only admin makes administration decisions. As Faculty in my Business School, for instance, I can only make decisions on matters academic. Intervening in administrative matters is a no-go zone area.

In other words, executives like Joshua Oigara, Martin Oduor Otieno, James Mwangi and others, usually get these strategic insights from the academics rather than the admin staff. Though faculty is the pillar and bearer of knowledge there are no structures to involve them in improving admin decisions. Being the strategic asset of business schools, they can be world class; but even if their candle light is bright, they cannot light the darkness that envelops academic institutions if they are not being managed by world class administrative staff. For instance, in most academic institutions, the head of finance is not the leading finance faculty of the institution. The same applies to Strategy, HR and ICT faculties among others.  Having a world-class faculty managed by third world administration is akin to driving E-Class Benz yet get beaten by Toyota Wish on the road.  

Attempts have been made towards improving this structural challenge by ensuring that the Vice-chancellors, their Deputies, and Deans are also academics – with the hope that they would bring their cognitive asset to decision-making in the higher echelon of the academic institutions. However, this has not helped much since knowledge management which is key in strategic innovation, agenda-setting, information generations, analysis, scenario building, and hypothesis is held by administrators, not the faculty. When faculty offers suggestions, the admin tends to say they are privy to some information that the faculty doesn’t have. Hence,  it is hard to break the holy grail. Financial incentives also play a part. That faculty seems to be paid more than the administrators has seen more exodus from non-faculty to faculty. Rather than help, this has contributed to losing promising admin to faculty bench, thus reducing the chances of admin competence matching that of faculty. To break the Holy Grail – let the admin open the window for fresh air to flow into the system.

Author avatar
Fred Ogola
Dr. Fredrick Ogola serves as the Chief Executive Officer of the Wanafunzi Investment Unit Trust Fund. He is an accomplished global executive in the consulting, information and financial services industries, with a proven, entrepreneurial track record in all aspects of running both large and small global businesses. He is the Academic Director MBA programs, Director of the Institute of Strategy & Competitiveness and Senior Lecturer of Strategy and Decision Making at Strathmore Business School. He is also Director Strategy and Investments of Property Reality Company and also Sits in the Board of the Arch Diocese of Nairobi Health Board. Dr.Ogola is a Part-time Professor of IESE Business School, the Leading Business School in Executive Education in the world. He also holds a Visiting Professor Position of University of St. Gallen, the Best University in German-Speaking Europe. He is a consultant on strategy formulation, Strategy Execution, and Change Management. Dr. Ogola holds a PhD in Management Science and Innovation with a focus on Strategy and Execution from ESADE Business School Barcelona Spain. He is a member of the European Business Ethics Network (EBEN) and the European Academy of Business In Society (EABIS). He has advised several SMEs in Structuring their management processes and setting their governance structure across East Africa.

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