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Article 1 Universidade em Debate ISSN 2318-700X Licenciado sob uma Licença Creative Commons doi: 10.7213/univ.debate.01.001.AO01 Would the university be a business organization like the others? Clemente Ivo Juliatto Post-doctorate at Harvard University, as a Fulbright Scholar, and University of London; doctorate in Organization and Management of Universities at Columbia University in New York. Rector of Pontifical Catholic University of Parana (PUCPR), Curitiba (PR), Brazil. Contact: [email protected] Abstract This article highlights some differences between the university and the other companies. It analyzes the past of academia, reviving the thoughts of several scholars in the theme. It examines the purposes of academic organization, particularly its speci�ic mission of preparing skilled manpower for the labor market, training for citizenship and increasing cultural standards and awareness. It emphasizes the university’s medium and long term labor and responsibility, in contrast with companieswhich aim at rapid growth and �inancial pro�its in a short period of time. This paper also reports that, at the present moment, in various places, there is an inappropriate economical wave whichaffects the academic management. This article also comes to conclusion that the university is a sui generis institution which, despite showing some characteristics commonly found in a company, must have its own administration with the use of more qualitative than quantitative methods. However, that does not release the university from expressing concern about the effectiveness, reliability and high performance of the administration. Keywords: University. Business organization. Mission. University administration. Would the university be a business organization like the others? If we say that the school is a temple, the university is a cathedral. If we say that at school we acquire knowledge, at the university we learn to be wise. (Quote found in the campus of Assumption University, Bangkok, Thailand). The economic stream strongly contaminates some university administrators and threatens the university which is fundamentally not pro�itbased. It is rather a social institution. I feel the need to write about the administration of a university in order to give my contribution and share what I have learned in many years of studies and management, geared directly to the implementation, growth and improvement of an academic institution. It has been noticeable the existence of a strong wave and a lot of pressure on academic managers, drawn primarily from educated people, perhaps in economics or business administration or even in other areas, which in-depth seem unaware of what a university stands for and yet work in the academic environment. Those people want to install the same principles and type of management that is applied in commercial or industrial companies as if the academic institution were just like any other company. To re�lect over this reality on how business and universities have similar and different management patterns at possible approaches is the goal of this article. I always recall what philosopher Karl Jaspers used to say about universities being the place where Society and Government allow the �lourishing of the most ludic conscience of its time (Jaspers, 1965, cited by Santos, 2005, p. 188). Those words demonstrate the importance and the particularity of the university as a social institution. I recall the words of John Henry Newman (1996) who, in 1852, claims to be the university aims to provide expanding way of seeing things, the openness of mind, the habit of thinking and the capacity for social and civic interaction. That purpose is really more connected to the mission of a university and less to the one of a pro�itable company, which aims at meeting other social needs. 23 Once Thomas Jefferson realized the social role of a university, he considered more important having founded the University of Virginia than having become President of the United States for two terms. The purposes of the university as an institution Recently, it has been placed into discussion the roles of a university as a company, a research university, a modern university and a contemporary university. For some, it may even seem that the university should be a different institution from the one that it has always been. It is evident that the university has to adapt to time and society to serve it well, since, just like society, it is also wavering and changeable. Indeed, it was to provide good service to society that it was created. The academia is the home of knowledge, the place par excellence for its cultivation and sharing. Still, one should not forget the original concept of the university as an institution, "community of teachers and disciples united in the pursuit of truth", which already implies the university as a de�ined environment and well differentiated institution. I consider this medieval de�inition of academia the best among many with which I came across. It is worth recalling that the truth is the supreme value of humanity, in which its pursuit has always been the commitment of well-intentioned people and healthy human communities which considered the university more than a millennial institution, it became an object of desire. Well, that commitment still remains, it cannot and should not change based on a simple spatiotemporal trend. The medieval university did not investigate much. In fact, there was little concern about professionalism. Its main task was devoted mainly to the general culture. The concern with research emerged primarily with brothers Humboldt, Wilhelm and Alexander at the founding of the University of Berlin in 1810. Within time, it was established the vision of the university, a privileged social institution, also having to provide Univ. Debate 2013 jul./dez., 1(1), 22-30 Recently, it has been placed into discussion the roles of a university as a company, a research university, a modern university and a contemporary university. For some, it may even seem that the university should be a different institution from the one that it has always been. 24 Juliatto, C. I. other specialized services to society. Thus, the threefold mission of the university was consolidated: teaching culture and professions; research or investigation to increase knowledge; extension, including the provision of various services to the internal and external community. For teachers, however, Higher Education consists mainly of professionalism and research, in other words, research and teaching. Ortega y Gasset (1946, p. 79), in his important work Misión de la Universidad, written in 1930, warns teachers, and by extension the university managers, about the danger which threatens them: "We need the man of science not to be what he is today, with deplorable frequency, a barbarian who knows much of a thing" and ignores the rest. For the philosopher, the scienti�ic talent that counts most in the university is the integrative talent. He claims that his experience has taught him that: Ultimately, learned professionalism and research results need to become some sort of purpose that seeks to address social needs, being deprived of their direct link with profitability. men endowed with this authentic talent walk closer to being good teachers than usuallysubmerged in research, because one of the �laws resulting from the confusion of science and the University has been the mistake of giving the Chairs to the investigators (a peculiar mania of our time) who are almost always bad teachers who consider teaching as a theft of hours done to their lab or �ile work. That is what my experience from years living in Germany told me. I lived there with many of the most categorized men of science of the time, yet I did not come across a single good teacher (Ortega y Gasset, 1946, p. 80-81). Ortega y Gasset (1946, p. 84) also advises: "In selecting the faculty, the gift that will be more taken into account should not be the prestige that the candidate has as a researcher, but the synthetic talent and his skills as a teacher". The same author goes further saying that "the pedantry and lack of re�lection have been the great agents of 'scientism' which harms the University" (p. 63). The philosopher claims that this is the reason why Higher Univ. Debate 2013 jul./dez., 1(1), 22-30 Education and research harms one another when you want to merge them instead of letting them side by side, very free in exchange, constant, but spontaneous. He concludes emphatically: "To state, therefore: the University is distinct but inseparable from science. Better say, the University is, in addition, science" (p. 87). For students, however, the author expresses his surprise at "seeing together and merged two distinguishing tasks." According to him, not all students need to be scientists. The author sees no considerable reason for the average man to be a scientist. It is clear, then, that the university is not only a research institute, in which there is only research, nor a vocational school, where there is only teaching and production of graduated professionals. It needs to do both: teach and research. Now, this dual function has implications for institutional management, for the manner of being organized in staf�ing and administrative operation. By including the third mission of the academia, which is the university extension or providing quali�ied service to society – it is meant for both the intra and extramural community – the issue becomes even more complex and problematic in view of the observations already undertaken by Gasset on how professionals perceive their academic work at the university . However, it is a matter to be considered a challenge with regard to its integration with teaching and research, especially when we are thinking of the speci�ic goals of the academic institution. Ultimately, learned professionalism and research results need to become some sort of purpose that seeks to address social needs, being deprived of their direct link with pro�itability. We would say that the university’s bond and commitment are to provide society with better prepared citizens in search for meaningful knowledge, agility in solving problems and sensitivity to the collective growth. Therefore, it is essential to recall Ortega y Gasset who protested against pedantry and lack of re�lection of some teachers. The same is true for little science and simplism, if not the conceit and arrogance of some unenlightened university administrators. Would the university be a business organization like the others? University and business organization A business institution primarily seeks to grow business, please their customers; produce more, sell more, in order to earn more money and thus increase as soon as possible the heritage of their owners. The company may even have other purposes, all secondary, but it is undeniable that the main goal is to pro�it. That is why its goals are almost always ambitious and most of them shortterm. A university, in its role, works with knowledge. However, the increase of knowledge does not always come in a short-term. The objective of preparing professionals to society, another duty that belongs to university, requires large and permanent harmony with the labor market whichis always moving. The formation of good people, kind people, good parents, ethical and sensible people, good citizens to society, another important goal of the academia, is time consuming and also costly. Several objectives of the university are of medium and long term. It is understood therefore, that time for a university is not the same as for a company. The company time now is mainly the short term, the university time is the medium and long term, I insist. Moreover, the short-term is mostly often not adapted to the production of knowledge, nor the evolution of scienti�ic research, and neither for the preparation of professionals and solidary citizens. However, those goals are very important for the university, to society and indispensable to progress. It is evident the danger and the risks of a utilitarian research, which many would like to see implemented in academia, in which economic and �inancial aims are dei�ied. It seems to me that, in companies, the pressure, the search for immediate results and overview of short-term prevail. According to this view, some think the academia should only investigate preferably what is useful to the market. Now, this is not always consistent with the concern with the search for a greater good for society and its citizens. The new knowledge favorable to the evolution of civilization and 25 proven to be so, are not always the short term. The university is therefore a stronghold in which knowledge creation should not be linked only to the �inancial interest. For its commitment to the whole society, the university should not and cannot concern itself only with a portion of society such as the productive and business sector. In ancient Greece, when looking for a site where to allocate the Academia of Athens, founded by Plato, about 387 B.C., aprecursor institution of the university, the founder recommended: as far as possible from the market ! ... Now the word market is not only the place of supply of public goods for the population, but it also refers to the business world, focus and symbol of the greedy eyes of the companies. When we talk about Modern University, we think of institutions devoted to research and strongly linked to its surroundings. Some scholars of the university refer to this model to encompass "innovative universities, entrepreneurs, factories of useful knowledge, traders of knowledge and �inished products, and knowledge enterprises" (Malagón Plata, 2004, p. 35). Bolstered by this concept, the universities are transformed into institutions that are fundamental to modern society. It is evident that research began to in�luence teaching. It was initially a kind of support to the teacher. Then, it became a more explicit support to industrial production. The Contemporary University is the result of the demands of the current context: globalization, transnationalism, differentiation and massi�ication of Higher Education. It is noticed that Higher Education has never been so important to the world as it is in present times and apparently will remain so in the future. This is true both in developed and developing countries. Quality education, especially Higher Education quality, is a distinguishing feature between nations. Therefore, the link between universities and the productive forces of society has become an obsession nowadays. Now, this concept of entrepreneurial university adopts some company features: strict Univ. Debate 2013 jul./dez., 1(1), 22-30 The university is therefore a stronghold in which knowledge creation should not be linked only to the financial interest. For its commitment to the whole society, the university should not and cannot concern itself only with a portion of society such as the productive and business sector. 26 It is clear that companies and universities have different logic. The first privileges the economy, the second aims at the social phenomena. It is wrong, therefore, to simply try to turn the university into a business organization, because it is an institution of a different nature, it is definitely not like the other companies. Juliatto, C. I. and centralized direction, diversi�ication of the so called academic businesses, diversi�ication of revenue sources, expansion of support and research tools preferably in a short term at the expense of educational functions and long-lasting knowledge production, which often requires to happen in a medium and long term. The Corporative University is another strategic concept which brings together some institutions created to train and educate employees and staff of a company in order to maximize the results of the corporation. The corporative university can take various forms: business schools or universities geared to meet the companies needs, universities established by companies, associations of universities and companies. An example is the Motorola University, founded primarily to serve the interests of the company that founded it. Here in the state of Paraná, it was created the University of the Industry – Unindus – together with the Federation of Enterprises. In other states or other countries, there are similar institutions to those just mentioned. Those institutions are special systems of teaching and learning rather than universities in the traditional sense, so we think, as well as Jarvis (2001) and others. This type of institution is restricted to developing speci�ic operational competence (know how), whereas the traditional university is also concerned with developing general academic competence (know that). In the so called age of knowledge, the partnership university-business grows, both because of the pressure from the Government and the needs of the companies themselves, be it for the production of new knowledge or is to supply skilled labor. The companies, however, have short-term goals and basically turn to pro�it and �inancial gains, whereas universities are dedicated to the pursuit of knowledge, education and culture. It is clear that companies and universities have different logic. The �irst privileges the economy, the second aims at the social phenomena. It is wrong, therefore, to simply try to turn the university into a business organization, because it is an institution Univ. Debate 2013 jul./dez., 1(1), 22-30 of a different nature, it is de�initely not like the other companies. Some expressions, which are used at times, should be commented on: academic businesses, businesses in education and other university businesses. For that, we mention Plato (2007): the knowledge of words leads to the knowledge of things. Consider the meaning of the terms: for example, when we talk about philosophy, we understand lover of wisdom; when we talk about Akadémeia, we understand "garden of Academo". We have said that Plato, the founder of the academia, was contrary to the brouhaha market. When we from Greeks to the Romans we �ind Cicero (1985), more political and literary than philosopher, but yet a great thinker. In Latin, negotium divides itself into necotium, which means work outside the otium; idleness implies leisure and rest. Negotiator is a banker. What does Cicero do? He works at the painful Otium cum dignitate. Leisure with dignity de�ines and summarizes or illustrates this article: bid farewell to the pro�iciency in order to �ind the essence. Here we are inserted into the critical view of this writing: university, strictly speaking , should take the side of the friend of wisdom rather than the money professional, without forgetting, of course, the ruling and opposing requirements: you need to live with dignity and to organize yourself for such. This paragraph completes the round trip: from Plato to Adam Smith, Adam Smith to Plato. We believe that the inevitable and essential mission of the academia is to serve society well. The money takes care of itself elsewhere. The expressions and contrasts listed above imply, or even directly proclaim, you can do some sort of deal with education. Normally, the word business is linked to some way of making money. There are people who view education as business; they even establish schools for that purpose. While there is still lack of social education, learning will continue to be business. Therefore, it is always important to do a very professional and ethical job with education. Education, health, Would the university be a business organization like the others? social promotion and other charitable areas of human activity are �ields of labor mainly for government agencies in wholesale and for the exercise of philanthropy of individuals and ideological groups in retail. University or business management? As mentioned in the previous paragraph, I insist that the current economistic in�luence on some college administrators at several institutions brings threats to the academia, which is, in essence, a social institution guided by the pursuit of knowledge and truth. The warning given by Derek Bok (2009), in 1990 is suitable and signi�icant. The dean of the prestigious Harvard University, about the risks of these current economistic alliances, claims to be no doubt that the �inancial bene�its that the institution can earn are overcome by the damage that such relationship can lead to academic science. Adopting a mercantilist and utilitarian perspective of academia can ruin the historic commitment of the university as an entity focused not only on development, but mainly on critical scienti�ic thinking. With the words of Malagón Plata (2004, p. 176), we insist that it always must be kept "live the utopia of a fairer society”. The university can and should be one of the main bastions in this endeavor. It is clear that there are two views that con�lict inside the university arena: a vision of education focused on technical and economic goals and the social academic vision. The second view does not leave out the �irst, but the enthusiastic adoption of the �irst will be very harmful to the second which ends upsuppressed, eventually. It should be noted that universities have always struggled to maintain their autonomy in order to be able to make criticisms and denunciations of the injustices that exist in society. It is noticeable that today these institutions are losing the necessary independence, because they are increasingly binding with the productive sector, with which 27 they end up working. Jarvis (2001) observes that in the world which demands moral stance, universities are losing their independence, placing themselves in dubious position or even changed, they alienate and distort themselves in the expense of their non-transferable larger scope of being servants and missionaries of the truth. The relationship university – business organization is based on the so called triple helix: state, company, university. There is no doubt that the new world scenario also calls for the university’s contribution to competitiveness and innovation. It is clear, however, that new types of institutions are emerging in the market: business schools and other institutions that only offer online distance learning. This change of focus on the university has direct implications on the role of the teacher and their teaching practices. They also in�luence the pro�ile of the student, the university's relations with society and with the academic and administrative priorities of the administrators. Among many others, Fabre (2011) is a dissenting voice on the subject of the corporatization of the university. The author warns and takes a clear position against the trend of the university in importing many tools from business management, which he considers calamitous. The academia has always been an institution rather conservative, he notes. It has capitalized on its existence and role on traditional values, which they guide themselves by. The author states (2011, p. 9): to mess it "is like changing the place of a cemetery: you cannot rely on the help of the inmates." By not knowing the difference between a university and company, aiming at implementing a typical business administration at a university can generate various dysfunctions and deep malaise within the university community. The academia has or should have another philosophy. For now, no important lesson was taken from the introduction of a business logic in the university administration. There is the idea, however, especially in the private business sector, that the university should be managed as a business, to make it Univ. Debate 2013 jul./dez., 1(1), 22-30 This change of focus on the university has direct implications on the role of the teacher and their teaching practices. They also influence the profile of the student, the university’s relations with society and with the academic and administrative priorities of the administrators. 28 In the exercise of its commitment to serve society well, it is obvious that the university also needs to be effective and efficient: it must manage well the resources it has. It is unacceptable that the university, a stronghold of smart people, is financially irresponsible or wasteful at doing its job. Juliatto, C. I. more ef�icient and effective, both in decision making and the use of resources. For Fabre (2011) and other scholars, this analogy of the university with the company is falsely innovative, whatever dimension is considered. From the ontological point of view, considering the university a business organization means simply to deny its speci�icity. We again insist: in business, to better serve the customer, improve the technologies and make them more competitive with the growth of ef�iciency and effectiveness and thus, improve performance, the main goal is to achieve return on investment made by the shareholders or owners. This is not the case of a university which its primary function is to serve society by educating and preparing citizens who wish to be competent, ethical and participatory. In the exercise of its commitment to serve society well, it is obvious that the university also needs to be effective and ef�icient: it must manage well the resources it has. It is unacceptable that the university, a stronghold of smart people, is �inancially irresponsible or wasteful at doing its job. Moreover, it is basically in the university, where many experts on the subject can be found, that they develop the knowledge and the proper study of management. To emphasize, the university also needs to be well managed, but appropriately, so that it can ful�ill its supreme and inescapable role. Good management is the one that provides the institution with the opportunity to fully ful�ill its mission. The university is responsible for the creation of knowledge and, only indirectly, for the creation of wealth, which is a main goal for companies. The university mission is therefore more qualitative than quantitative. Before the rise of "university capitalism", it is time to reaf�irm the values proclaimed by "university citizenship". Given the technical and entrepreneurial vision proposed by some managers, who wish to impose it, apparently unaware of the soul of the university, it resolutely matters to opt for a more humanistic view, based on ethics and academic tradition. For the university, Univ. Debate 2013 jul./dez., 1(1), 22-30 this implies adopting a management of its own for, according to its characteristics. Thus, a re�lection on academic values and identity of the university is imposed to the managers who bear responsibility for the institution. The primary concern of university administrators cannot be with the mere increase of economic-�inancial pro�iciency of the institution. We have already denounced the growing myth of importing typically managerial tools and intending to adopt them for the university management as the only way to improve the performance of academic institutions. Well, this initiative is just an allegory or a mean excuse. This view can even be called the Trojan Horse, inserted in the university environment (Fabre, 2011). Far from insinuating that the university does not need good management, we propose thinking about other more consistent policies with their nature and mission, all of them different from strictly business entities. The requirement done to universities to serve the general interest of society, and not just a segment, does not allow it to be run like any other business institution. Clearly, this makes the university administration more complex. There are visions of university with more numerous and comprehensive missions to the point that they classify it as a true Multiversity (Kerr, 1963). In the era of knowledge, the scienti�ic expertise of the university cannot be so myopic when concerned only with the short-term utilitarian view, and imagine itself as any other company. The university is much more than just a business organization. Universities must ensure the initial and continuing education of citizens and professionals, as in this casting: scienti�ic and technological research, dissemination of culture, and scienti�ic and technical information, international cooperation and other good social causes. That is much more than companies do, mainly concentrated in the �inancial return, promoting initiatives, directly or indirectly, but primarily for the immediate scope. In the long term, human development, if correct and healthy, is dependent on the university necessarily. Without Would the university be a business organization like the others? the university, no country can progress, in austere and demanding balance, to have a future. At the present moment, where winds blow towards management, the business model, with its allurements and predominantly quantitative instruments, is also in�luencing the university management. Well, in the academic institution collegiality prevails in contrast with centralism which ordinarily prevails in companies. To make changes happen in the academia, when necessary, we must rely on the acceptance of the international community and not simply impose from the outside a decision strange to that community. Submitting to those postulates certainly does not please eagerly ambitious managers. So far, "nothing proves irrefutably that the power of market forces to improve the level of research and Higher Education" (Dill, 2003, cited by Fabre, 2011, p. 56-57). Therefore, I insist that any change in the administration and structure of the university must take into account the added dimensions: historical, economic and cultural. In the university, the coexistence of a collegiate autonomy and centralizing vision will certainly be con�licting. The view that the university works as any other company, for all administrative purposes, in which managerial tools are suitable for one as they are for the other, is a myth and a scam, again simply because those institutions are not equal. For managers who adopt that view, there is a clear preference for the adoption of quantitative parameters at the expense of quality. For managers with such a view, qualitative variables are not very reliable, which reinforces the myth of complete predictability. As a result, it generates real fetishism to use only quantitative indicators. It is exactly in this way that the university creates the "illusion of the virtues of the market" (Fabre, 2011, p. 84). Concluding I conclude my remarks with the words of the master Jim Collins (2005), known and respected author in administration, who also wrote about 29 the management of social institutions such as universities as social institution par excellence. They represent well my opinion and that of most scholars of the subject: the confusion between means and ends is at the root of the differences between business and social organizations. In business, money is the means and also the ends. In social organizations, money is only resource and not measuredin greatness. The author complements saying that for social organizations, the performance needs to be evaluated in relation to the mission and not the �inancial return. Like any business, the university has a structure, an organization, goals, resources and personnel, it also offers products and services to society. Therefore, it needs planning, elaborated decisions, professionalism, quality assessment and improvement in performance, economic viability and longterm survival. The university faces the challenges of the market: competition, changes and new professional demands, evasion and delinquency, etc. Because the university is subject to these variables, the university administrators need to worry about excellent management, linked to the institutional identity and mission of the academia. In many ways, this can lead managers to consider it like a business, but they need to have the insight that only by these similarities the university does not become a business, but a separate organization which requires continuous evaluation to avoid losing basic assumptions of their identity, and thus truly set as an institution that promotes teaching, research and extension. The university is different from a regular business for its pursuing social goals, for its role in educating citizens, for the characteristics of their nature and the humanistic management model they adopt. When considering only the university as a company, or comparing it to the institutions they are not resembled, we risk forgetting the most important mission: serving society, people and Education. Furthermore, many universities are public institutions, or nonpro�it, philanthropic in Univ. Debate 2013 jul./dez., 1(1), 22-30 The view that the university works as any other company, for all administrative purposes, in which managerial tools are suitable for one as they are for the other, is a myth and a scam, again simply because those institutions are not equal. 30 In this article, by contrasting universities with companies, the purpose was only to emphasize the specificity of academic organization. It was not intended to diminish companies, demonize them, or say bad things about them. Juliatto, C. I. nature, and some even of religious nature, which further reinforces their sense of mission. In this article, by contrasting universities with companies, the purpose was only to emphasize the speci�icity of academic organization. It was not intended to diminish companies, demonize them, or say bad things about them. Far from it, they deserve great admiration, because in addition to promoting the wealth and progress of nations, they provide the population with work allowing many families to have quality life, contribute to the wellbeing of the population with the product they offer, promote social stability, promote many charitable campaigns and provide valuable support to social organizations. I recall the initial question, title of this article: Would the university be a business organization like the others? For me, the correct answer would be yes, at a certain level, but rather in lowercase letters and NOT in uppercase letters! By the differences pointed out in this article, one easily realizes that the university is an institution sui generis and cannot be expected to manage itself as if it managed any other business organization, which does not mean, at any time, that the administrators must not be concerned with ef�iciency, reliability and high performance in the university’s management . References Bok, D. (2009). Más allá de la torre de mar�il: La responsabilidad social de la universidad moderna. Buenos Aires: Fundación Universidad de Palermo. Cícero, M. T. (1985). De oratore, libro secondo: Testo, costruzione versione letterale e note. Milano: Dante Alighieri. Collins, J. (2005). Good to great and the social sectors: Why business thinking is not the answer: A monograph to accompany Good to great. New York: HarperCollins. Univ. Debate 2013 jul./dez., 1(1), 22-30 Fabre, B. (2011). L’Université a-t-elle perdu son âme?: Plaidoyer pour une autre réforme. Paris: L’Harmattan. Jarvis, P. (2001). 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