INSTITUTIONAL STRATEGY
T he modern
credentials are expanding and there is increasing pressure to develop transferable skills that allow individuals to adapt across roles and sectors. • Technological: Advances in generative artificial intelligence (AI) are making knowledge increasingly ubiquitous and personalised. As a result, the comparative advantage of universities is shifting away from the transmission of content and towards the formation of judgement, complex thinking, the ability to apply knowledge in real-world contexts and socio-professional capabilities. It is the last of these forces that is perhaps the most consequential. According to a 2025 student survey by the Higher Education Policy Institute, 88 per cent of UK undergraduates now use AI for their assessed work, up from 53 per cent the previous year. The primary issue is not that students are using these tools, it is what that usage reveals about the assessments themselves. In other words, if such a large proportion of assessed work can be produced by a machine, the assessment was probably not measuring what we thought it was.
university is often discussed in terms of campuses, degrees and technologies. Yet historically, the very notion of the university, or universitas in medieval Latin, did
not primarily refer to a physical place, but to a corporate body or community comprising masters and students organised around teaching, learning and the pursuit of knowledge. This origin matters because it reminds us that the university is, at its core, a social and institutional arrangement – and that its legitimacy depends on the value it creates for society. Consequently, debating the future of higher education should not only constitute questions around technology or pedagogical innovation. It is the very social contract of the university that is at stake: why it exists, whom it serves, how it is financed, how it demonstrates public value and how it sustains legitimacy in a context of fiscal pressure, political polarisation and rising expectations. In this sense, the future of higher education is not a predetermined destination. Instead, it is an ongoing transition, the direction of which rests on strategic choices, governance and institutional design. The shifting landscape At the level of the external environment, four structural forces are reshaping higher education systems, as detailed below: • Demographic: In many countries, tertiary systems are maturing, enrolment growth is slowing and school‑age cohorts are declining. This increases competition for students and forces institutions to rethink their value proposition, both in undergraduate and postgraduate education. • Financial and political-institutional: Funding models are becoming tighter, public scrutiny is increasing and there is growing demand for measurable outcomes. At the same time, the legitimacy of universities is being more openly debated. • Employment market transformation: Demand is shifting towards applied fields, professional
“The future of higher education is not a predetermined destination”
In search of verifiable judgement Over the next decade, therefore, universities will not compete primarily on their ability to deliver information. They will compete on their ability to form graduates with verifiable judgement, through their provision of demanding learning experiences, authentic assessment and credible credentials, supported by an appropriate governance of AI. This shift fundamentally reorders the logic
of education. When factual knowledge and first-layer explanations become widely accessible at low cost, the university’s distinctive contribution lies in the design
Business Impact • ISSUE 4 • 2026
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