Public support, financial pressure and questions of workforce relevance aren’t new challenges for higher education leaders, but they’ve never converged so fiercely, according to the latest report from EAB, a consulting firm.
“They’re accelerating and exacerbating one another, putting unprecedented strain on the university business model and our margins,” says Brooke Thayer, senior director of research development.
A rapidly changing higher education landscape demands organizational agility: Leadership must be prepared to make tough calls while remaining adaptable to emerging threats.
“In this environment, the greater risk is not uncertainty itself, but paralysis,” the report reads. “A decision delayed by fear of pushback, controversy or disruption frequently carries higher long-term costs than a decision to act decisively amid ambiguity.”
What’s disrupting higher ed?
Policy shifts, enrollment decline and structural deficits are intensifying pressure on institutions. But no challenge is more urgent than responding to AI and its broad societal implications, Thayer says.
“We are seeing this growing effect that AI and other economic factors are having on the entry-level job market, but how are we preparing for the future?” she says.
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“AI has huge implications for higher ed’s value proposition, and it requires a much broader discussion about curriculum and pedagogy.”
Leaders must remain agile as AI evolves, ensuring students build AI literacy along with judgment and collaboration skills that employers still need.
Six ways to re-tool higher education leaders
Leadership teams must follow core principles to sustain momentum when scrutiny and fatigue threaten decision-making:
- Decision resolve: “We are in the era of hard decisions,” Thayer says. “The longer you delay, the fewer options remain,” which “become far less appetizing.”
- Unapologetic focus: Institutions must eliminate lower-value initiatives and double down on what works. Notre Dame de Namur University, for example, recently sold its campus, narrowed its academic scope and now specializes in 10 online graduate programs.
- Portfolio logic: Strengthen investment strategy. More small and mid-sized colleges are turning to external investment managers to navigate complex endowment markets.
- Change-ready system: Ensure academic and governance structures support innovation. Arizona Western College’s new academic division operates outside the traditional semester model, enabling rapid response to local business needs.
- Urgent long-termism: Prepare now for emerging challenges rather than deferring them.
- Executive resilience: Boards must support leaders through difficult decisions to avoid “chronic resets” caused by leadership turnover, Thayer says. Institutions should also carry priorities forward even as executives retire or step down.
