(update below) Fred Hilmer, Vice-Chancellor of the University of New South Wales, looks back on the UNSW Asia debacle. One of the question that I asked in my post immediately after UNSW’s announcement was about the real reason for UNSW’s sudden departure. Much news has been reported since, but none of the explanations can fully explain it. Hilmer points to the low enrollment numbers as the reason and the fact that the Singapore Economic Development Board wasn’t willing to accept their rescue plan.Today it was also reported that high fees led to the fall of the Singapore Campus. This has been said by many others but it can’t be a sufficient reason. Other senior academics at UNSW Asia blamed a lack of marketing for its demise. Sure, this might be part of the explanation as well. Simon Marginson of the University of Melbourne University explained that the business plan was plain bad and based on too rosy a set of enrollment projections.

I think we have to conclude that there is not one single reason for UNSW’s pull-out. It is more a concurrence of circumstances that led to a major fiasco. But why hasn’t this been foreseen by a big professional organisation like UNSW? Hilmer basically inherited the whole situation and the only thing he could be blamed for, is for opening the campus at all at the start of this year. The establishment of the UNSW Asia campus of course goes further back in time. At least until 2003.

It is interesting to see that the whole development of the UNSW Asia idea has coincided with a period of rather unstable governance. For a period of ten years the university was under the energetic leadership of John Niland. Niland has a good relation with Singapore and extensive knowledge about the region. He is currently Member of the Board of Trustees of the Singapore Management University. However, keeping in mind that UNSW was only approached by EDB in 2003 to consider setting up a campus in Singapore, it is unlikely that Niland was involved as a VC.

This means that the whole process, from EDB invitation to the closure in May 2007, took place in no more than 4 years. In these 4 years however, the UNSW has had 3 Vice-Chancellors! The first contacts with EDB have been with Rory Hume, now Provost at the University of California. Hume became VC in 2002 and resigned in 2004, because of the way he handled a case of academic misconduct in the university. Hume’s successor was Mark Wainwright who held the VC Office from July 2004 until his retirement in June 2006. This must have been the period where the main negotiations with the EDB have taken place and where the plans for the campus were formed. It was under Wainwright that UNSW Asia was officially launched, that Greg Whittred was appointed president of UNSW Asia and two deputy presidents were announced.

So in 2006 Fred Hilmer left his position as CEO of John Fairfax Holdings and became VC of UNSW. When he came into office, UNSW Asia basically was a ‘fait accompli’. Hilmer has never been a true believer in the Singapore venture, but he did not really have the option to pull out since all agreements were made and everyone was set to go. The Singaporean Strait Times (26 May, 2007) reported that ‘the death knell for the Singapore campus was sounded the very week that Prof Hilmer took over on June 19, 2006’. He pulled out eventually because financial risks would steeply rise with the construction of a city campus in 2008.

A leading actor in the whole saga – and the one that actually signed the MOU with the EDB in April 2004 – is Former Deputy VC for International & Development, John Ingleson. He held this position since 2001 and was also CEO of the international education, training and consultancy arm of UNSW, New South Global. While he was an outspoken advocate of UNSW Asia – and of global academe in general – he seems to be the most silent factor in its aftermath.

Ingleson left UNSW after vice-chancellor Fred Hilmer restructured the university’s top level a year ago. He is now Deputy VC I & D at the University of Western Sydney and also member of the Board of Directors of IDP (a company offering student recruiting and testing services and is part-owned by the Australian universities). The same company also undertook a program-level marketing research for UNSW Asia and was the exclusive recruiter of international students for UNSW Asia.

My two cents? A bad business plan, pursued by an over-enthusiastic DVC who overestimated economic opportunities and underestimated risks in the global higher education market. While there were plenty of reasons to slow down the development of UNSW Asia and the individuals pushing it, this never happened because clear and stable leadership at the very top was lacking at that time. By the time Hilmer inherited the situation, it was a done deal. He tried to make a deal with the Singaporeans but they didn’t bite. Option 1: run the risk of even higher costs because of the construction of a campus; Option 2: get out, now costs are still bearable. May 23…Press conference…option 2…closed.

UPDATE 18 July: Rory Hume, in a letter to The Australian, argues that the decision to start the Singapore Campus was not made in haste. He explains the events until he left to the US. What happened afterwards?

I do not know what happened during the following three years as UNSW worked to finalise a business plan and arrangements in Singapore to enable the project to succeed.

If it’s true that Hume has indeed been very careful in making the decision, my interpretation would be that the crux has been in the negotiations with the EDB. Agreements made in these negotiations – by Ingleson, probably – have been re-evaluated by Hilmer when he came to UNSW.

To the commentators below: Anonymous, I still don’t think that the whole UNSW disaster can be attributed to Hilmer. Hume’s letter ssems to support that things went wrong in the negotiations between UNSW and EDB. Paul: I think that my update above strengthens your point even further. And Jon: I don’t know if it was bound to fail, but under the existing agreements it probably was. In general you can observe that it is very hard to make a viable business model for overseas branch campuses.

This article has 8 comments

  1. Anonymous

    It was Hilmer’s decision and you let him off the hook far to easily. He stands to lose UNSW $80+ million dollars by pulling out and will leave without an asset. For a similar sum over five years he could have remained, had a fantastic asset and started to recoup after this period.
    In addition no one has factored in the the complete loss of goodwill and UNSW reputation in Asia which will take many decades to re-establish.
    UNSW will now spend additional millions on trying to lure back Asia astudents,PR campaigns and amrketing costs.

  2. Paul

    Notice that none of the higher level people implicated are out of work!

    Modus operandi –

    1.Start something that sounds sucessful, promise great things.

    2. Leave before it fails, for a better job elsewhere.

    3. After moving up the ladder,go back to 1. and repeat as many times as necessary.

  3. Jon

    @ anonymous: Hilmer of course can’t be blamed for starting the whole fiasco, and I don’t think anyone could have made a success out of this. It was bound to fail. @Paul: Yes, that’s the way those things go, although I am not so sure whether he left or was “ordered” to leave

  4. Dan

    Yeah. I agreed that you let Hilmer off the hook far too easily. However for a business venture of such a scale, it should have been thought over carefully in details over the years. It shouldn’t end like this; perhaps UNSW is too eager to end it. From what I know, Singapore Management University and European’s Insead Institute also took couple of years to build up their credential in Singapore. Should UNSW Asia stay on a few more years without constructing their new campus; they might become a popular uni in the south-east Asia region. It’s just too bad that UNSW didn’t want to even leave any room for testing. I guess until someone discloses the true reason, no one will ever know the truth for the sudden closure. The true victims are the staffs who gave up their job in Australia to teach in UNSW Asia and the students.

  5. Edward

    Eric

    You have a v thoughtful set of observations here, and from where I sit I think you’re right to look closely at Hilmer and his appetite for risk. UNSW, for better or worse, had committed itself. So had Singapore. The problem Hilmer faced was that the Singaporeans had not set up an environment (and the key is research funding frameworks) in which a global university brand could operate at a high-end, research intensive way. It was Hilmer who pulled the plug, but only after he pushed for a deal (i.e. a small liberal arts college) the risks of which were bearable. But it seems as though the negotiating relationship (i.e. trust) with the EDB had broken down by the time he put a scaled-back college option on the table. Hilmer knew that the EDB had allowed his predecessors to sign up to a sop on two previous occasions. The Singaporeans took issue with a third round of re-negotiations. We have, of course, to look at Hilmer’s actions/instincts in the context of the dynamic of the negotiating relationship with the EDB – which relates to the broader issue of whether universities can operate effectively outside of their national ‘comfort’ zones — bearing the risks, accepting the conditions, and building the relationships of trust within another culture. The other factor to keep in mind is whether the Singaporeans actually understand what it will take to sustain a fully comprehensive foreign research university within their city-state. You don’t get there with high-volume student numbers and industry-funded R&D.

    Best, Edward

  6. Eric

    Edward,
    your last point is an interesting one. I think that has to do with Warwick unwillingness to set up a branch campus. I’m sure that studies like engineering, business, etc. will always take priority over humanities, physics, etc. in these types of universities.

    You also bring up some interesting observations on the UNSW Asia issue. I think we do agree on the fact that the whole venture was (too?) risky from the start, even before Hilmer got involved.

  7. Sudhi Sant

    Ah, ha. I wonder how the “proposed” IIT in Singapore will pan out. There was an announcement by Kapil Sibal the Indian Minister of HRD about setting up an IIT in Singapore. Hopefully, they have learnt some lessons about “foreign universities” setting up campuses in Singapore.

    Cheers

    Sudhi

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