How to fully embrace digital transformation for your educational institution
Universities across Australia have started investing more in digital technologies. But there’s a key difference between just digitising existing processes and fully embracing digital transformation.
Digitising means applying technology to current methods, while digital transformation involves rethinking and redesigning systems to fully leverage new technologies.
Securing buy-in for transformation initiatives requires a well-constructed business case that clearly outlines potential return on investment (ROI) and broader strategic benefits.
This blog explores the key steps universities can take to create a compelling business case for digital transformation, emphasising the importance of linking efforts to clear outcomes and ROI.
The Business Case for Digital Transformation
As universities juggle competing priorities, such as rising costs and growing sustainability requirements, complete digital transformation can be overlooked. For example, some universities may focus on upgrading their online learning platforms but stop short of integrating these systems into a cohesive experience for students.
Globally, education is under-digitised compared to other industries. Holon IQ reveals less than 4% of global expenditure on tech goes to education. This highlights the need for greater investment in digital solutions across the board.
According to the report, Future Disruptions for Australian Universities, Australian universities will face major challenges over the next 10 to 20 years. These challenges include geopolitical tensions, climate change, and evolving technologies like generative AI, which are already reshaping how we learn. The report suggests universities need to adapt their operations and learning experiences to new technology.
As information becomes more digital, the spaces for learning and research also need to change. For example, in the future, there will be less need for lecture theatres and more demand for technology-enabled collaboration and group spaces.
Additionally, students increasingly expect services and education delivery to be digitised to a high standard. A report by Great State reveals 70% of students say digitised universities must become as good as Amazon, Netflix, and Facebook.
If you’re reading this blog, you probably already understand the importance of investing in digital transformation at your institution. The challenge may be convincing others to make investments that will set your university up for the future.
We’ll show you how to make a business case for digital transformation, including predicting both direct and indirect ROI.
Making a Business Case for Digital Transformation
Step 1. Align digital transformation with institutional goals.
The first step in making a business case is to make sure digital transformation matches the university's strategic goals.
Your business case should demonstrate how digital tools can help achieve specific goals, such as increasing student retention, improving graduation rates, or expanding online course offerings.
For example, if your goal is to invest in a digital experience platform (DXP) like Liferay DXP, make sure you outline how this investment maps onto your strategic goals.
A DXP can significantly improve the student experience by providing a unified platform for accessing academic resources, participating in online discussions, and managing administrative tasks. DXPs can also cut down on administration costs by automating routine processes, which can lead to a reduction in administrative overhead.
Additionally, the enhanced engagement and streamlined experience offered by a DXP can contribute to increases in student retention and boosts in overall student satisfaction.
By connecting outcomes to the university’s strategic objectives, you create a strong case for why a technology like a DXP is a valuable investment.
Step 2. Secure stakeholder engagement.
When making a business case, involve key people from the start. This includes faculty, administrators, IT staff, and students. Their feedback helps identify the best digital solutions and shows how they’ll benefit the university community.
Engaging these stakeholders early helps ensure your changes are effective and get their support, making implementation smoother.
Step 3. Conduct a cost-benefit analysis.
A detailed cost-benefit analysis is crucial to any business case. The analysis gives a clear picture of potential returns and required investments. Include both direct and indirect costs, as well as expected benefits over time.
Here’s what to include:
Initial costs: Include expenses for software, hardware, implementation, and training. Be clear about the upfront investment needed.
Ongoing costs: Consider maintenance, subscription fees, and costs for scaling up the digital infrastructure.
Financial benefits: Highlight savings like reduced administrative costs, lower dropout rates, and increased revenue from new online programs.
Qualitative benefits: Focus on improvements like better student satisfaction, enhanced faculty engagement, and a stronger institutional reputation.
Here’s an example of a formula you can use for cost-benefit analysis.
Calculate total costs: Sum up initial costs (software, hardware, implementation, training) and ongoing costs (maintenance, subscriptions, scaling).
Calculate total benefits: Combine financial benefits (cost savings, increased revenue) and estimated financial value of qualitative benefits (improved satisfaction, engagement).
Calculate net benefit: Subtract total costs from total benefits to determine the net benefit, and calculate ROI by dividing the net benefit by total costs and multiplying by 100.
Step 4. Articulate the long-term value of digital investment.
Although ROI is critical, a successful business case will also articulate the long-term value and strategic benefits of digital transformation.
Here are examples of the long-term value digital transformation can provide:
Enhanced student experience: Digital tools can make the student journey smoother, from enrolment to graduation. These tools offer personalised support, easy access to resources, and a seamless learning environment.
Improved institutional competitiveness: In the global education market, universities that invest in advanced digital solutions can attract top students and faculty and build strong partnerships with other institutions.
Agility and resilience: A strong digital setup helps universities quickly adapt to changes, like new educational trends, shifting student needs, or unexpected events like a pandemic.
Sustainability goals: Many digital initiatives support sustainability by reducing the need for physical resources, cutting down on waste, and promoting energy efficiency.
By investing in digital tools, universities can enhance the student experience, boost competitiveness, improve adaptability, and support sustainability goals.
Step 5. Build a strong communication strategy.
Even the most well-crafted business case will fall flat without effective communication.
Presenting the case to stakeholders requires a clear, persuasive narrative that highlights the urgency and importance of digital transformation.
A clear communication plan will have:
Tailored messaging: Stakeholders have different concerns. Administrators may focus on cost savings, while faculty might prioritise improved teaching tools. Tailor the message to each group for the most effective communication.
Data-driven evidence: Use data and case studies from other universities to illustrate the potential ROI and strategic benefits. Concrete examples make abstract concepts more relatable and compelling.
Transparency: Be upfront about the challenges and risks associated with digital transformation. Acknowledging these factors builds trust and demonstrates that the university is prepared to address potential hurdles.
Transforming the University Experience
As we’ve discussed, the university experience is evolving rapidly, driven by advances in technology, changing student expectations, and global shifts in education. To stay competitive and relevant, universities must not only adapt to these changes but also anticipate what the future holds. By investing now in transformational tools, institutions can position themselves ahead of the curve.
Using this business case framework, universities can effectively demonstrate how these digital investments will meet current needs as well as prepare the institution for future demands. Whether it's enhancing student engagement, improving operational efficiency, or expanding global reach, the right digital tools will ensure that universities are equipped to thrive in an increasingly digital world.
Investing in digital transformation now means reaping the benefits both today and in the years to come.
