international education
campusreview.com.au
Outsourcing agreements overcome
the risk of loss of control, and can be very
effective in controlling costs – but there are
risks (even if only in perception) in terms of
service delivery and quality. For example, the
privatisation of public transport services in
Australia has often been an emotive topic,
with views expressed that private ownership
of these public assets has resulted in higher
costs and lower quality than if they were to
remain in government hands. Such views
are often revealed as misguided when
performance metrics are assessed. Indeed,
privatisation often results in an uplift in
service standards given the strict contractual
obligations imposed on private operators.
At the same time, the reality is that without
support from the private sector in the form of
capital, governments would struggle to fund
upgrades and new assets. The same can be
said for some universities.
The biggest problem with outsourcing
university facilities is that traditional
agreements tend not to incentivise a
long-term view. A third party will focus on
commercialising assets in the short term,
but will have no real incentive to upgrade or
modify assets significantly, if the benefits will
not be felt during the period of the outsource
agreement. This is exacerbated by current
procurement models, which seemingly
prioritise competition over the customisation
and innovation potential that would be
possible in a bilateral negotiation process.
LONG-TERM PARTNERSHIPS
It makes sense that a truly long-term
partnership tailored to the specific
circumstances would provide protection on
both sides – where universities would not
lose ownership nor full control of their assets,
but would be able to hand over the specialist
maintenance, operations and potential for
improvement and innovation in the way the
assets are managed.
In this way, they can unlock capital which
can be re-oriented to core educational
objectives, and in many cases a long-term
partner would be willing to invest a significant
upfront rebate, or infusion of capital – as a
sign of their long-term commitment.
From the partner’s perspective,
commercialising the assets as they stand is
the first and necessary part of the equation.
But there is also a real incentive to look at
innovative ways of developing infrastructure
(in particular in terms of parking and
transport) in line with global trends and the
opportunities on offer from developments in
technology, in order to make the long-term
commitment pay off.
But what would this look like in reality?
FUTURE-PROOFING FACILITIES
Let’s take a look at transport and the exciting
trends in mobility. This is where the concept
of mobility as a service (MaaS) comes in.
Put simply, mobility refers to moving people
around, which for a university means to and
from campus as well as within campus. But
mobility as a service represents a new way
of thinking about transport, one that has the
potential to be the most significant innovation
in transport since the invention of the car.
With MaaS, never again will you be late to
class or an appointment due to difficulty in
finding a parking spot.
MaaS aims to do for ‘moving around’ what
Airbnb has done for accommodation: turn
it into a service, accessed and paid for on
demand. Or, like Netflix, via subscription.
Anyone with the app can enter a destination
and select the preferred mode of getting
there, or where no single mode covers the
door-to-door journey, a combination of
modes. And users can either pre-pay for
the service as part of a monthly mobility
subscription, or pay as they go using a
payment account linked to the services.
It’s a model which has been in place for
nearly three years in Helsinki, Finland – which
has become a kind of MaaS global testing
ground through the use of an app launched
in 2016. The app, Whim, integrates every step
in the transport process – from planning to
ticketing and payment – into one platform.
It offers four tiers of service – free, pay as
you go, a monthly subscription (offering
unlimited public transport and reduced rates
for taxi and car shares), and an unlimited
option, which adds unlimited taxis and car
share access. It covers public transport, taxis,
car rentals, car-share and bike-share modes.
The reason Whim has worked well in
Finland is that it’s a small country with well-
functioning institutions and well-designed
cities – and because the government has
encouraged private and public transport
providers to work together.
This sounds pretty similar to plenty of
universities, many of which are reminiscent
of small, well-run cities.
bilateral basis with Northeastern University in
Boston. It is the first such agreement entered
into with a private university in the US, and
provides for the management and operation
of, and investment into, the campus-wide
parking system as it exists now, but also with
a vision for future MaaS transport potential.
Initially, the responsibility is quite
straightforward: to manage the parking
permit system, assist commuters, manage
event parking and maintain parking facilities.
The university also benefits from a substantial
upfront capital commitment to support its
education mission.
But the long-term nature of the partnership
requires QIC to undertake major renovations
to build the long-term value of the system,
via technology-enabled MaaS features.
There are a number of MaaS initiatives on the
agenda, and all are focused on better meeting
commuters’ travel needs through highly
responsive systems that cater to the changing
transportation needs of the campus.
QIC is in the final stages of a transition
period, after which we’ll be responsible for
the parking system in its entirety and begin
implanting major technological upgrades so
we can better integrate mobile technologies
as we move forward.
MOVING TO THE FUTURE
THE AMERICAN EXPERIENCE We know that finding new ways of looking
at old problems is a real imperative for
universities, in a world where funding is
under pressure and competition for students
fierce. The ability to rank well on global
league tables is key to success, but to do this
requires significant investment in teaching
and research. At the same time, campus
life, the quality of facilities and the university
experience all play into students’ ultimate
decisions, so these non-core areas cannot
be neglected either.
We believe one potential solution, already
underway in the US, is for universities to
consider long-term partnerships with
specialist infrastructure providers willing to
invest in assets while building the long-term
value of the system through innovation.
Ultimately, it is likely to be these more
forward-thinking universities – those that
embrace innovative ways of focusing on
core competencies while leveraging those
of others – that have the greatest chance of
solving the funding conundrum.
A good case study of how long-term
partnerships might work – and to help solve
the funding paradox – is the recent 50-year
partnership that QIC has negotiated on a Trent Carmichael is a partner at global
infrastructure specialist and investment
manager QIC.
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