The next two decades will see international demand for education grow strongly. Deloitte Access Economics projections show that Australia’s onshore international education sector is capable of increasing from 650,000 enrolments today to 940,000 by 2025. If Australian universities can overcome strong competition from other international education systems, like Canada, which aims to double the number of international learners by 2022 to 450,000, then they should be firmly positioned to take advantage of this growth. At the same time, technology is changing the way education is purchased, experienced and consumed. It is extending international education markets beyond established geographic and service boundaries. Delivery modes are expanding and evolving, and so too is the range of education and training services available. These supply-side shifts are potentially just as seismic as the changes in demand. In 2015 Deloitte Australia’s Centre for the Edge investigated this new paradigm in education, revealing that sometime in the not too distant future, we will have two sectors rather than one: an old, industrialised sector that is increasingly marginalised and irrelevant for the majority of the population, and a new sector that aligns with trend-lines in workforce development and human capital. With the growing role of robotics and smart machines, the corporate workforce is changing—radically and rapidly. These changes are no longer simply a distraction; they are now actively disrupting the skills and capabilities that graduates will require in the future. In order to fully capitalise on this new paradigm, Australia’s higher education providers will need to innovate their business models and underlying value propositions to remain competitive – ensuring they are more nimble and enterprising than they have ever been. This will involve exploring new markets and segments and developing innovative products and services to meet changing demands of learners and industry. Based on our work with Australian universities there are a number of notable opportunities that can be addressed through this process. These include: Key Opportunities: Delivering a truly tailored & flexible solution for students – Easy access to the information each student requires to make informed choices about their education, flexibility in learning methods and platforms, hands on skill development aligned with industry requirements, provision of the knowledge and skills that will prepare them for greater uncertainty and change in the workplace, clear pathways to employment, tailored intervention and support through the entire university lifecycle (including lifelong learning opportunities). Changing the role and capacity of academics – Reduced administrative burden that empowers them to pursue intellectual interests and advance knowledge with minimal constraints, improved means of identifying and fostering collaboration with other institutions, researchers and industry, technology that will facilitate real-time formal/informal feedback on course/teaching performance, and the ability to tailor teaching methods to allow for more efficient and effective instruction of students. Creating an open connection with industry – Greater collaboration with researchers to create alignment between research and the problems they are facing, with the aim of developing innovative solutions to old and new problems that will deliver improved outcomes. They also want smart and capable (correctly skilled) work-ready graduates who are effective learners, problem solvers and team players, while minimising the cost to recruit and retain them by providing them with access to flexible learning options early and often in their career. Positioning to deliver on a revised value proposition – Crafting a revised value proposition is only the first step. Following this, Australian universities will need to amend their operating model to facilitate the effective delivery of a revised suite of services aligned with the new value proposition. Operating model design and the services that are delivered will vary between institutions, but there are a number of key enablers universities can put in place to support their effective implementation. Each of these enablers is outlined below. Key Enablers: Intelligent Automation – Cognitive computing is the simulation of human thought processes in a computerised model. It involves self-learning systems that use data mining, pattern recognition and natural language processing to mimic the way the human brain works. This concept has been explored in a number of recent posts by Deloitte University Press. This cognitive technology could be applied to universities to enhance service delivery in a range of areas. For example a ‘Cognitive Advisor’ such as IBM Watson could be employed to scrape a range of structured and unstructured data, like course feedback (formal and informal), exam/test results, attendance records and industry trends, to determine what teaching/learning methods are most effective in engaging students and delivering improved academic outcomes. The technology could recommend initiatives to course developers and teachers, which can be actioned to improve retention and ensure students are being educated in a way that will best embed the skills and knowledge required by industry. Universities will also be more informed about learning styles before classes starts, allowing for better matching of students and teachers. Overall, this should enable a more tailored and flexible education experience for students. Robotic Process Automation (RPA) – RPA is the application of technology that allows humans to configure software or a “robot”. This “bot” can capture and interpret existing applications for processing a transaction, manipulating data, triggering responses and communicating with other digital systems. For universities, this machine learning intelligence can be applied to automate processes delivered by back-office functions with the aim of redirecting funding and effort to teaching and research activities underpinning the previously mentioned opportunity to change the role and capacity of academics. This can be applied in combination with cognitive technology, which has the ability to act as an input and driver of this machine intelligence. One example of how RPA can be applied in a university setting, in combination with cognitive technology, is through the automation of business rules supporting direct marketing to potential students and the processing of student applications. This combination of technology could push information to potential students through email/SMS or other mediums (e.g. Twitter / Facebook), about courses, pre-requisites and other relevant information. The solution would be able to provide personalised advice to assist students who have submitted incomplete applications or fail to meet pre-requisites. These first two enablers highlight that fulfilling a revised value proposition will not necessarily require a university to increase staffing levels. Revised teaching/learning methods and a new credential – A new education paradigm will likely see education in early years focused on basic literacy, numeracy and digital literacy skills as well, as the mind-habits needed to become self-motivated learners. With the middle years of learning extending to instruction focused on the attitudes and behaviours needed to treat each challenge as an opportunity to learn and grow, and instilling an attitude of lifelong learning. Acknowledging this, universities will need to explore the adoption of teaching/learning methods that will broaden the experience of students, so that they have a diverse range of skills that they can use to solve problems within their profession. This will also entail the development of a new type of ‘credential’ that extends beyond the traditional ‘Grade Point Average’. According to Deloitte’s Centre for the Edge, the driver behind the new credential will be time – the significant time and effort required to harvest and then validate the breadcrumbs of information that we all leave behind on the internet. These new credentials will be founded on the three pillars firms are using to qualify candidates in the new creative economy, by looking at their past to determine: Problems in which in the individual is interested Their ability to integrate new ideas into their work and have an appetite to continue learning and improving Their ability to work as a part of a cross-functional team. The traditional credentials will remain an essential tool for a range of professions and circumstances, however leading-edge firms are seeking to find individuals who exhibit the behaviours and have a proven track record, which shows they will be productive members of the firm. In order to fully capitalise on a new paradigm within the education sector, Australia’s higher education providers will need to innovate their business models and underlying value propositions to ensure they remain competitive. The time for change is here and now.