2U : Why a Digital Transformation Strategy Is an Imperative for Universities, Now More Than Ever

As the world begins its collective crawl out of COVID-19, there's no denying that the pandemic has dramatically reshaped the higher education landscape, accelerating tailwinds that have been building for over a decade.

COVID softened the ground for university leadership, faculty, staff, and students to experiment with and adjust to teaching, learning, and administering courses online. Most institutions of higher learning have, at minimum, been able to adapt and adopt adequate methods for delivering remote instruction. A much smaller number have been mapping their online practices back to their core mission in order to extend it, and have even begun imagining and activating new possibilities for the future.

More than a year after the pandemic began, one particular notion seems to be dividing the pack: Moving courses online, while a significant challenge and undertaking, is one thing; developing and executing a digital transformation strategy is another.

For universities to remain relevant, competitive, and financially viable in this era of tremendous technological change, having a strong, comprehensive digital transformation strategy is imperative-now more than ever. Institutional inertia is no longer an option. Here are four reasons why.

1: Increased Digital Adoption

The barriers between physical and digital experiences are breaking down across every industry. People have an increased comfort with doing everything online, including learning. Today, post-pandemic, nearly every student in the U.S. has experienced online education in some capacity.

Learners from all backgrounds continue to report a growing preference for online education, with Strada reporting that 3 in 10 Americansexpress that even without COVID as a concern, they'd prefer an online-only learning option. Much like 'online shopping' has become simply 'shopping,' 'online education' is becoming normative 'education' in the modern era.

2: A Growing Population of Adult Learners

As the relationship between education and work shifts, student demographics are rapidly changing. The new economy has created an expanding population of adult learners who need to continuously upskill and reskill to stay relevant in the modern workplace. The pandemic has only deepened the demand for workforce-aligned education: Millions of unemployed or under-employed workers need training to secure new jobs. At the same time, many regional and programmatic accreditors have been re-evaluating and changing their requirements, requiring professionals to return to school for retraining.

According to the National Center for Education Statistics, non-traditional students- working adults, parents and caregivers, retirees, distance learners, etc.-are growing faster than the population of traditional on-campus university students. Strada Educationalso reports that interest in work-based and online education programs has increased substantially throughout the pandemic, with over a third of Americanssaying they will need additional training or education to find new jobs.

3: Heightened Competition

The online higher education market is rapidly expanding, and students are becoming savvy consumers. They're looking for high-quality programs that deliver academic excellence, engaging experiences, and a clear return on investment. The online degree market is one of the fastest-growing segments of global higher education, forecasted to reach $74B by 2025 by market intelligence firm HolonIQ, up from $36B in 2019.

But creating successful online programs in an increasingly crowded online marketplace isn't easy: Burning Glass's 'Bad Bets' report reveals that 26% of online degree programs launching on the heels of the Great Recession reported zero conferrals by 2018, a high failure rate that reflects the challenges institutions face when launching new programs. High-quality online education demands a sophisticated capability set, including many capabilities that are outside the traditional university structure.

4: Mounting Liquidity and Financial Challenges

Colleges and universities, even well-endowed ones, are confronting complicated structural and budgetary challenges. The Hechinger Reportestimates that more than 500 institutions show two or more signs of financial strain. Nearly 30% of all four-year schools brought in less tuition revenue per student in 2017-18 than in 2009-10. Furthermore, according to the American Council on Education, less than 5% of college budgetsare dedicated to IT spending today.