The transformation of higher education in Brazil: a case study on the creation of a private educational giant

Transformación de la educación superior en Brasil: un estudio de caso sobre la creación de un gran grupo educativo privado

Abstract

In recent decades, universities have experienced substantial change. Several studies in Brazil and abroad adopted a critical perspective on the marketization of higher education. This paper contributes to this stream of research and focuses on the transformation of a large private university in Brazil. After an investment fund acquired an equity stake in this university, the institution implemented new teaching and administrative practices and adopted values embraced by private financial organizations and a set of so-called modern management methods. We present the case and discuss the perspectives for private higher education institutions and their faculties. We also claim that private universities should be theorized as hybrid organizations. Finally, we speculate on the vectors that could contribute to a positive transformation of private universities.

Keywords:
Marketization; Higher education institutions; Case study; Hybrid organizations

Resumen

En las últimas décadas, las universidades han experimentado cambios sustanciales. Varios estudios en Brasil y en el exterior han adoptado una perspectiva crítica sobre la mercantilización de la educación superior. Este artículo incorpora esta perspectiva y se centra en la transformación de una gran universidad privada en Brasil. Luego de que un fondo de inversión adquiriera una participación accionaria en esa universidad, la institución implementó nuevas prácticas docentes y administrativas y adoptó valores de organizaciones financieras privadas y métodos de gestión modernos. Presentamos el caso y discutimos las perspectivas de las instituciones privadas de educación superior. Además, proponemos que las universidades privadas sean teorizadas como organizaciones híbridas. Finalmente, especulamos sobre vectores que podrían contribuir a una transformación positiva de las universidades privadas.

Palabras clave:
Mercantilización; Instituciones de educación superior; Estudio de caso; Organizaciones híbridas

Resumo

Nas últimas décadas, as universidades sofreram mudanças substanciais. Vários estudos no Brasil e no exterior adotaram uma perspectiva crítica sobre a mercantilização do ensino superior. Este artigo incorpora esta perspectiva e foca a transformação de uma grande universidade privada no Brasil. Depois que um fundo de investimento adquiriu uma participação acionária nessa universidade, a instituição implementou novas práticas de ensino e administrativas e incorporou valores adotados por organizações financeiras privadas e métodos modernos de gestão. Nós apresentamos o caso e discutimos as perspectivas para instituições privadas de ensino superior. Nós ainda propomos que universidades privadas sejam teorizadas como organizações híbridas. Finalmente, especulamos sobre vetores que poderiam contribuir para uma transformação positiva das universidades privadas.

Palavras-chave:
Mercantilização; Instituições de ensino superior; Estudo de caso; Organizações híbridas

INTRODUCTION

In the 1990s and 2000s, the term McDonaldization gained the status of a descriptive metaphor about the transformation of universities from institutions that created knowledge and prepared citizens to service providers focused on the customer and the market (Hartley, 1995; Hayes, 2007; Hayes & Wynyard, 2002a, 2002b; Nadolny & Ryan, 2015; Ritzer, 2002). McUniversities are institutions designed to efficiently deliver standardized content, with little or no investment in research activities. Such institutions are managed like private companies; they are guided by the ideology of management (Chiapello & Fairclought, 2002; Grey & Willmott, 2005), and (allegedly) adopt advanced management techniques to achieve results (Parker & Jary, 1995; Prichard & Willmott, 1997).

This research follows a line of studies focusing on the marketization of higher education institutions (e.g., K. M. Kallio, T. J. Kallio, Tienari & Hyvönen, 2016; Komljenovic & Robertson, 2016; Parker, 2014; Provini, 2019; Salto, 2018; Spence, 2019; Teelken, 2011; Ter Bogt & Scapens, 2012). Our paper get inspiration specially in studies that analyzes organizational changes and related these changes with those in regulation and institutional environment. To access the international literature, the EBSCO database was used and complemented with Google Scholar. The search was carried out in 2018 and updated in early 2021, using the following keywords: marketization, commercialization, macdonaldization, in addition to higher education and universities.

This paper also seeks to dialogue with the prolific Brazilian academic literature on the transformation of higher education, also characterized by its critical appraisal of the marketization (e.g., Almeida, 2009; Chaves, 2010; Costa & Silva, 2019; Cunha, 2007; Gotardo, 2016; Martins, 2009; Oliveira, 2009; Sguissardi, 2015). To access the Brazilian literature, the Scielo database was used. The search was carried out in 2018 and updated in early 2021, using the following keywords: mercantilização, comercialização, in addition to educação superior and universidades.

Analyzing both the foreign and the Brazilian literature, we identified a small number of empirical studies held at non-public universities, focusing on ‘how changes happen’ (e.g., Komljenovic & Robertson, 2016). In fact, most studies seem to focus on managerial changes introduced in public universities. However, in countries like Brazil, private institutions occupy a large space in higher education (see Ranking Universitário Folha [RUF], 2019). Indeed, the genesis and transformation of large private higher education groups is a relevant phenomenon, with a substantive impact on local economies and communities. Among other effects, they create jobs, mobilize suppliers and commerce around them, and contribute to social mobility, providing access to higher education for low-income students. Of course, one must not be naïve, as they are commonly managed as financial institutions, aimed at capturing maximum value for stockholders.

Consequently, we understand that there is a gap, represented by the scarcity of studies that analyze the organizational transformation associated with the creation of large private education groups. Our objective is, therefore, to contribute to understand the changes implemented in a private higher-education institution after it sold part of its controlling interest to an investment fund, within the context of regulatory and institutional transformation.

In our study, we gained access to one of the largest private higher education institutions in Brazil, which we will call UniOne (a fictitious name). The study focused on transformation at the organizational level. We recognized that a study that focused on individual impacts (on professors and researchers) might also be valuable, however, it would be beyond our ambitions and possibilities.

We think that the lessons of the case may be of interest to university managers and professors as well as to fellow scholars concerned with the phenomenon of marketization of higher education. We hope this study contributes to the current literature on higher education: firstly, by dialoguing with the international literature, which focuses mostly on public universities, and showing that the same phenomenon reaches private institutions; and secondly, by complementing the Brazilian literature, which focuses mostly on the institutional level; and portraying what ‘goes inside’, i.e., how a private higher education institution transformed itself after changes in the regulatory environment.

Ultimately, we propose that private universities should be theorized as hybrid organizations, attending multiple stakeholders, thus combining features from both private companies and ‘traditional’ public universities (Battilana & Dorado, 2010; Battilana, Singul, Pache & Model, 2015). The term hybrid comes from biology and refers with the product of crossing different breeds or species. In management studies, hybrid organizations are characterized by the coexistence or juxtaposition of antagonist logics, such as, for instance, a developmental logic and a financial logic (Battilana et al., 2015); or a market-oriented logic and a human development-oriented logic (Haigh, Walker, Back & Kickul, 2015). Hybrid organizations may also be characterized by hybrid management practices, regarding, for example, leadership, human resources, and strategy. Hybridism brings ambiguities, tensions, and paradoxes to management. However, it may also make organizations more capable of dealing with complex environments and divergent demands from their stakeholders.

The remainder of this article is divided into six sections. The following section briefly presents the phenomenon of marketization of higher education. The next section describes the changes that have taken place in higher education in Brazil. The following section presents the methods used in our field inquiry. Next, we present the changes that took place at UniOne. In the following section, we theorize UniOne as a hybrid organization, and discuss perspectives for this university and for other similar institutions. In the final section, we present limitations and directions for future research, and our concluding remarks.

THE MARKETIZATION OF HIGHER EDUCATION

The transformation of higher education produced literature that was critical of the process, frequently called marketization. Studies discussed the negative effects of marketization, focusing on threats to the traditional academic culture (Craig, Amernic & Tourish, 2014; K. M. Kallio et al., 2016; Spence, 2019); the consequences for researchers, e.g., anxiety and stress, inhibited creativity and risk aversion, less-relevant research, and less enjoyment of work (Ter Bogt & Scapens, 2012); and the deterioration of the knowledge production (Geppert & Hollinshead, 2017).

Additionally, several studies called attention to the difficulties or strategies of resistance (Bristow, Robinson & Ratle, 2017; Muller-Camen & Salzgeber, 2005; Parker, 2014) or tryed to identify the different ways in which schools respond to the new models (Donina & Paleari, 2018; Teelken, 2012). In an illuminating case study, Komljenovic and Robertson (2016, p. 1) examined marketization at Newton University. They identified market exchanges and explored microwork that, together, “are recalibrating and remaking the structures, social relations and subjectivities, within and beyond the university and in turn reconstituting the university and the higher education sector”.

Hence, what do authors mean when they name a process of transformation as marketization? By analyzing various references and the scientific literature on the subject (e.g., Komljenovic & Robertson, 2016; Teelken, 2012; Ter Bogt & Scapens, 2012), one may find seven characteristics. First, a system that seek to promote competition, thus making universities more efficient, predictable, and controlled, as they seek better use for their resources. Second, a restructuring process that enables universities to operate as market-oriented companies, thus prioritizing its role as services organizations instead of knowledge generators and disseminators. Third, the naturalization of profit and stockholder value as legitimate objectives for management. Fourth, an increase of market exchanges involving the university and the wilder world, i.e., companies, social organizations, public agencies, government, and the society at large. Fifth, to perceive students as customers rather than leaners, thus making them a component of the business model. Sixth, the implementation and use of so-called modern approaches and techniques of management, to maximize efficiency under the ideology of management. These may include, among many other tools, strategic planning, quality management, management by objectives, budgeting, performance management and customer relationship management. Seventh, the cultural transformation from a ‘a community of scholars’ into a ‘workplace’ (Teelken, 2012, p. 2).

Meanwhile, Brazilian scholars produced a fruitful stream of critical studies on marketization of higher education (Almeida, 2009; Chaves, 2010; Costa & Silva, 2019; Cunha, 2007; Gotardo, 2016; Oliveira, 2009; Sguissardi, 2015). However, their approach to the subject is distinctive from, and complementary to, the approach adopted by their foreign colleagues, as the Brazilians most frequently analyze, with critical lens and from institutional level, the growth of the private higher education institutions in Brazil. For instance, Costa and Silva (2019, p. 6) analyze what they named ‘new academic neoliberalism’ in the higher education sector in Brazil, characterized by ‘a capitalist commodification’. By the same token, Sguissardi (2015, p. 869) argues that higher education in Brazil ‘lives an intense process of transformation of a right into a merchandise`, and Oliveira (2009) defends that education has been financialized and private education is nowadays hegemonic in Brazil.

Taken together, these authors provide a broad view of the transformation of higher education in Brazil. They relate these changes to the neo-liberal policies implemented in the country in the 1990s. In fact, many Brazilian authors argued that the vigorous expansion that follow institutional changes preserved the elitist model, as it remains highly qualified for a few and offers a low quality, mass product for the majority. As we observe previously, studies were made at institutional level, with few exceptions (for example, Almeida, 2009). That creates an opportunity for organization studies and management scholars interested in the phenomenon, and willing to investigate it at both organizational level (which is the case of this study) and individual level.

CHANGES IN HIGHER EDUCATION IN BRAZIL

Starting in the 1980s, changes aligned with the neoliberalism, the New Public Management, and managerialism created a new environment for the creation, growth, and consolidation of private universities (Diefenbach, 2009; Ter Bogt & Scapens, 2012). The understanding of regulatory changes and their impacts is essential to the comprehension of marketization in any context.

Higher education has a relatively short history in Brazil. The country introduced higher education rather late. The first institutions were established in the early 19th century, and the first university opened only at the beginning of the 20th century. Brazilian universities were created by the local elite, who defended the idea of public higher education.

However, in 1961, the first Education Bases and Directives Law was enacted, changing the sector’s structure, and easing the growth of private institutions (Cunha, 2007). Brazil’s new federal constitution, enacted in 1988, further facilitated and streamlined the process required to create new courses. Accordingly, between 1985 and 1996, the number of private universities leaped from 20 to 64 (Martins, 2009, p. 23).

In 1996, the Education Bases and Directives Law was changed again, ushering in for-profit higher-education institutions. This change reflected the assumption that government would not have sufficient resources to support the expansion of the system and that private institutions would be necessary to meet the growing demand (Andrade, 2012; Barreyro, 2008; Oliveira, 2009; Schwartzman & Schwartzman, 2002).

Brazilian private higher-education institutions adapted to the new regulations in two ways. Some opted to work in specific education niches. Others pursued the growth of undergraduate courses, resorting to high-volume and low-cost strategies (Schwartzman & Schwartzman, 2002). The latter believed there was a major market opportunity because only 30 percent of secondary-school graduates attended higher education (Sampaio, 2011).

The change in the Education Bases and Directives Law was also perceived by economic agents as an investment opportunity. Accordingly, educational conglomerates were established as private corporations with investments from private-equity funds (Oliveira, 2009). With time, the sector consolidated, and large educational conglomerates were created (Chaves, 2010).

Another factor that encouraged the growth of the private higher-education system was when, in the mid-2000s, the federal government created full- or part-tuition scholarships for low-income students (see Catani, Hey & Gilioli, 2006), through the Prouni program, and special credit lines for students, through the Fies program. These programs provided a considerable boost to the higher-education system.

Between 2001 and 2008, the Brazilian educational market experienced wide consolidation, with many mergers and acquisitions fueled by investment capital (Sampaio, 2011). The transactions with the greatest impact were the 2007 IPOs. Small, private higher-education institutions that were still run by their founders were sold to large educational conglomerates (Sampaio, 2011). This was followed by mergers and acquisitions that involved international private higher education institutions (Oliveira, 2009; Oscar, 2012).

The consolidation of private higher education institutions into corporate groups changed the way they were managed. The need for efficient management led to the adoption of modern management practices. Meanwhile, students were drawn to the low tuition fees (Chaves, 2010; Schwartzman & Schwartzman, 2002).

From the late 1990s to the 2000s, higher education institutions and enrollments grew vigorously, catalyzed by the private sector (see Fritsch, Jacobus & Vitelli, 2020). According to a higher-education census (Instituto Nacional de Estudos e Pesquisas Educacionais Anísio Teixeira [Inep], 2003), from 1997 to 2003, the number of private higher education institutions grew from 689 to 1652, while the number of public higher education institutions decreased from 211 to 207. Ten years after, in 2013, Brazil had 2090 private higher education institutions. Table 1 shows figures for 2007 and 2013, period more closed related to our field work, plus 2018, the last available.

Table 1
Changes in higher education in Brazil

	2007	2013	2018
Total number of higher-education institutions	2,281	2,391	2,537
Number of federal higher-education institutions	106	106	110
Number of state higher-education institutions	82	119	128
Number of municipal higher-education institutions	61	76	61
Number of private higher-education institutions	2,032	2,090	2,238
Total enrollments - undergraduate courses	4,880,381	7,305,977	8,450,755
Enrollments in private higher-education institutions	75%	74%	75%
Enrollments in public higher-education institutions	25%	26%	25%

• Source: Inep (2018, 2013, 2007).

To complement the information, Box 1 shows the top 10 universities, in number of enrollments, and the top 10 universities, as classified by the RUF (Ranking Universitário Folha), a popular university ranking in Brazil. While private institutions enjoyed a wide lead in the number of enrollments, public institutions led the Brazilian ranking of best universities. In 2019, the top 10 universities were either federal or state, and only seven private institutions ranked among the top 50 universities (RUF, 2019).

Box 1
Top universities in Brazil

When ranked globally, however, even public Brazilian universities performed poorly. In 2018, not even one was included among the top 100 according to Shanghai Jiao Tong University’s Institute of Higher Education or the QS World University Rankings.

Indeed, Brazilian public higher education institutions have been impacted by a protracted crisis, which further worsened in 2016 and subsequent years, when the country faced economic hardships. This has created a challenging situation. On the one hand, Brazil’s public institutions still provide the best conditions for learning and research, even if they fall well short of international standards and face decline and crises. On the other hand, the country’s private institutions are expanding and consolidating but offer inferior learning and research conditions.

METHODS

For this study, we sought a large higher education institution that had experienced substantial change. We contacted several institutions that met this criterion. However, most of them declined our invitation. Finally, UniOne responded positively to our call. UniOne represent an almost archetypal case of marketization, as it had transformed itself, along the years, into one of the biggest private universities of Brazil, famously substituting its old ethos and practices in favor of managerialism and modern techniques of management. Consequently, it represented an ideal subject for our inquiry.

The investigation lasted approximately six months and followed the usual procedures for qualitative research involving case studies (Creswell, 2010; Stake, 1995; Yin, 2005). Data were collected using 12 long, in-depth interviews. The interviewees were selected because of their relevant role in the change process (see Box 2). By the 10th interview we achieved saturation in the most critical aspects under investigation. The usual restrictions experimented in this kind of field work in organizations, related to availability and strategic content did not interfere substantially.

Box 2
Interviewees

The interviews used a script of open questions that encouraged interviewees to spontaneously expose their points of view on the changes that took place. The questions involved different aspects of change. They were based on categories from the Burke and Litwin’s (1992) classic model of organizational performance and change (for example, strategy, structure, culture, governance, and management systems), with the addition of categories related to the subject and found in the higher education literature (for example, curricula, faculty, students, and staff). Besides, a few categories emerged inductively from the field work (for instance, external communication, financial planning, and facilities). Several interactions between authors helped improved the script. The interviews were recorded, transcribed, and analyzed.

All interviewees were very experienced professionals and were all involved with the transformational process. Therefore, one can assume a certain bias in favor of its objectives and implementation. On the other hand, it is worth mentioning that many interviewees presented critical views of the process.

The interviews represented the main source of data. However, following the principle of triangulation, we also consulted and analyzed quarterly reports and market reports for a three-year period: videos on the IPO process, five scientific papers on UniOne, dozens of newspaper and magazine stories on UniOne, and corporate material published on the institution’s website. Additionally, one of the researchers made three visits to UniOne’s main campuses and kept a notebook with field remarks. To ensure anonymity, some bibliographic references were eliminated or changed (Bell & Bryman, 2006).

We analyzed the data following the procedures recommended by Bardin (2006), relying especially on the concept of fluctuating reading. We first built a collective, chronological narrative of the change based on the interviews and on information from the documents reviewed. Then, based on contents, we defined the key changes that took place, which were grouped into three categories: changes in the management mode; changes in the teaching and research model; and changes in the management of faculty, students; and employees. This grouping matured after several interactions between the authors, and between the authors, the literature on organizational change and primary data from the case. Presentations in public events also contributed. For the two first categories we identified dimensions and practices that changed. For the last category we identified, similarly, groups and practices that changed. Finally, successive interactions between the authors allowed for the identification of ‘exceptional aspects’ that feed our discussion section. These interactions considered the literature on marketization, the case study, and the academic experience of the authors.

THE UNIONE CASE

Our field research focused on the 2007-2013 period. In 2007, UniOne had its IPO. In 2008, an investment fund acquired 20% of the institution’s shares and became actively involved in managing it. In 2013, this same investment fund sold its interests in the university, closing the cycle. This section presents our findings.

Foundation and growth

UniOne was established in 1970 as a not-for-profit college (Almeida, 2009). According to several interviewees, the founder was a visionary entrepreneur who was able to lead an ambitious and fast growth process. In 1988, the institution was recognized as a university. At that time, it had over 8,000 students and 650 faculty members (Almeida, 2009; Vale, 2012).

In 1998, the university set out on an aggressive nationwide expansion process. This process created new campuses. Each new campus operated independently, reporting their results directly to the organization’s headquarters. According to Interviewee # 1:

At the time of Dr. Jones [the former owner, fictitious name] he would identify an executive and say: ‘Look, go there and open it!’ And then, the executive […] had a blank bank check and did what was needed.

In 2005, the founder engaged the services of a consulting firm to prepare the organization to go public, which happened in 2007. In 2008, the founder’s family held 55% of the shares, the market held another 25%, and an investment fund held the remaining 20%. This investment fund played a key role in the changes that would take place in the years that followed.

The investment fund brought to UniOne a team of professional managers. This team reined in the organization’s expansion and implemented a process some interviewees called academic and management cleanup. This process was based on three pillars: professionalization of management, improved teaching quality, and administrative centralization.

Changes in the management model

To lead the changes, the investment fund set up a dedicated team, appointed a new university president, and defined a master plan of changes that included goals, actions, timelines, individuals in charge, and events to monitor execution. Two major projects spearheaded the changes: the creation of a shared-services center, and standardization of courses and their content, with the support of a knowledge management system. Concerning this last action, according to Interviewee #10:

It was not possible to explain to a student who was leaving a course at UniOne in [city 1] and arriving here in [city 2] […] and we would say ‘you’re going to miss those subjects’ […] it was very complicated […] each place had its characteristics.

According to most interviewees, changes were implemented in a ‘top-bottom’ fashion, common to those initiatives applied in private companies with the help of new appointed leaders, experts, and consulting firms. They were perceived as ‘rational’, and the ‘right thing to do’, as the market for services of higher education becomes more competitive. According to Interviewee #4:

Any university that does not differentiate itself from the others will face a serious problem [...] because the student knows he/she can choose and wants to choose where to study. So, this demand for quality will force us to differentiate.

However, changes produced conflicts and resistance, and did not progressed evenly in different units and regions. Even though, all changes moved ahead, with the faster implementation of the shared-services center and the slower implementation of the standardization of courses and contents. According to Interviewee #10:

With the creation of the [shared services] centers, much of the work that was performed [at the teaching units] would be limited to delivering our teaching services. […] we would focus the operation on what is the main objective of a teaching unit, which is to teach.

Box 3 summarizes the main changes occurring in 11 management practices and dimensions.

Box 3
Changes in the management model

Changes in teaching and research

The teaching model also underwent considerable change. Previously, different campuses had considerable autonomy in relation to teaching matters. Moreover, the involvement of faculty in school life and in the development of syllabi ranged widely.

The two principles that guided the changes on the teaching front were the pursuit of standard practices and the alignment of courses with job market demands. The change process included a concerted effort to review the syllabi. A unified knowledge management system was implemented to follow and control the changes. The new model enabled gains in synergy among equivalent courses offered at different campuses and among different courses that had similar subjects. Moreover, this standardization streamlined the process to open new campuses. Interviewee # 10 remarked plainly:

We cannot think about mass teaching letting each of the professors individually in the classes do whatever comes to their minds, so it was necessary to have this structure.

Interviewee #6 observed that the top-down process was negotiated:

I do not believe in a small, wise elite group producing the best curriculum and implementing it top-down all over Brazil. The only way to engage a professor is to make him participate in the process of construction [...] Coordinators, at both national and local levels, had in their goals the participation and engagement of professors in the construction of curricula.

The Brazilian regulatory model encourages higher education institutions to invest in research. Graduate programs are reviewed regularly based on their scientific publication, among other factors (Sistema Nacional de Avaliação da Educação Superior [Sinaes], 2018). Moreover, many professors also expect to do research.

As a result of this double pressure, UniOne set up an internal agency targeting innovation and technological development. The role of this agency was to bring the institution closer to companies. UniOne adopted a criterion that assigns priorities to investment in research that can provide financial return. This requirement restricted the scope of research to themes that are of greater interest to companies and bring faster results.

The changes involving teaching and research demanded more time than administrative changes. Interviewee #6 synthesized the general approach and emphasized the time and conditions given by the board of the institution so that change could be assimilated:

It is very naive for us to think that companies, with all these super capable leaders and CEOs, have no idea of the need for product and business sustainability, [...] the board gave up growth for a year and a half, and we did not really grow, we healed the institution academically [...] with the construction of an academic proposal […] completely innovative in Brazil and in Latin America. [...] I do not know of another [initiative] in the world of such a large scale. [...] one of the fundamental pedagogical premises was that new projects were built by professors.

According to the interviewees, faculty who supported the changes and were more actively involved in them were rewarded with more teaching opportunities. Given the existing employment contracts, this represented better pay. Box 4 summarizes the changes in five dimensions.

Box 4
Changes in the teaching and research model

Changes in the management of faculty, students, and employees

The management of faculty underwent profound changes. In a short period, faculty went from an overstaffed team where many professors worked part time and dedicated few hours to teaching to a lean team where most professors worked full time. Individual assessment, career management, variable pay, and training systems were implemented. Interviewee #6 observed that the professor’s role was preserved:

We must respect [the professor] […] the complexity of the classroom will never be taken away from [the professor], because, as much as you tend to establish a teaching plan […] the examples belong to the professor, the contextualization belongs to the professor. […] There is no such illusion that the professor will only follow protocols.

To what the same interviewee # 6 added:

[The] owner of complexity is the professor, not the manager [...] And that is what is difficult for some minds who come from other industries to understand [...] we did not take the complexity out of the professor; we created an extra layer of complexity, whit the discussion in the knowledge management system, in which the professors need to negotiate with their peers.

The management of the student body was also redefined based on a perspective that the average UniOne student comes from a lower social and economic class, pursues upward mobility, and has a utilitarian view of knowledge.

The management of employees aimed at having a stable workforce. Not unlike what happens in private businesses, individual assessment, career management, and development plans were implemented. The presence of investment fund representatives in leading the changes had also a profound impact on the organizational culture. Interviewee #9 declared:

What was the great initial challenge? Bringing together two cultures that were absolutely separate: the culture of management and the culture of academia.

To what the same Interviewee #9 added:

[A]nd my role in this change was to make [people] learn as much as possible about what matter for the business; the professionals who did not make the transition, became obsolete, because the business has completely changed. and we did need a management shock.

According to the interviewees, the change process promoted principles of meritocracy. The adoption of these principles led to the implementation of career plans and variable pay, determined according to the institution’s ratings in assessments made by the Ministry of Education. Indeed, it sought to balance quality and profit. According to Interviewee # 1:

In the beginning, we had a bold weight in the financial indicators; but now […] there are quality indicators. It is no use bringing EBTIDA at the end of the month if your course has grade two [according to the Ministry of Education standards]. Grade two get you penalized.

Modelling in financial firms, a culture of performance was promoted. Significantly, Interviewee # 4 observed bluntly a common call to people under his leadership:

There are only two certainties in life: that you will die and that every end of the month you will explain your results to me.

Box 5 summarizes the changes related to faculty, students, and staff.

Box 5
Changes in the management of faculty, students, and employees

Impact of the changes

The changes had financial and academic impacts. At the time of its 2007 IPO, UniOne’s shares were traded at BRL 7.90. By September 20, 2013, the share price had climbed to BRL 17.34, providing substantial earnings for the investment fund, which sold its interest on that date.

Academic results can be assessed using the National Higher-Education Assessment System (see Sinaes, 2018). From 2007 to 2015, UniOne’s standing among a group of 200 Brazilian universities improved considerably. Its general index increased from 2.2200 to 3.1018 (on a scale that goes to 5.0000). UniOne’s relative position remained in the last quartile most of that period, but it moved up to the second quartile in the last two years, even coming close to the first quartile in 2015.

DISCUSSION

In this section, we start reviewing the seven characteristics of marketization identified previously and seek to justify why UniOne may be theorized as a hybrid organization. After that, we bring into discussion two themes that emerged conjointly from the theory and the analysis of the case: perspectives for UniOne and other private educational institutions, and perspectives for professors and researchers. Our objective is to adopt an orientation toward prescience, as a way of fulfilling our scholarly role of facilitating organizational and societal adaptiveness (Corley & Gioia, 2011). In other words, our ambition is to connect theory and practice, thus offering practical insights that emerged from the work.

UniOne as a hybrid organization

At first glance, examining the case through the characteristics listed in the second section of this paper - market orientation; profit and stockholder value; efficiency; market exchanges; students as costumers; management techniques; and cultural transformation - one may consider UniOne to be an archetypical example of marketization.

However, a closer examination of the transformation process carried out at UniOne shows a more nuanced reality. Take, for instance, characteristics number fifth - students as customers rather than leaners - and seventh - the cultural transformation from community of scholars into a workplace. For both, we observed that neither condition precisely describe UniOne.

Consequently, we argue that UniOne transformed into a hybrid organization. The following UniOne characteristics sustain this claim: first, it clearly combines features from more traditional types of universities with features of private companies; second, it seeks to combine a human-development logic with a market, financial logic; third, it seeks to attend different stakeholders, such as regulators in the educational system and stockholders; and fourth, it juxtaposes specific, traditional practices of higher education institutions, with the so-called modern management techniques, commonly adopted in the for-profit sector, specially by financial firms.

This proposition echoes the conclusions of Fioreze (2020, p. 79). On her study on four regional community universities in Brazil, the author observed that “[t]here is potential to accommodate a hybrid model, able to balance both the approximation to the market and the preservation of the values of higher education as a public good”.

Hybrid organizations (Battilana et al., 2015; Battilana & Dorado, 2010) are under the influence of different logics and must balance demands from distinct societal domains and cultural systems (Schildt & Perkmann, 2017). Some authors (e.g., Jongbloed, 2015, p. 221), argue that universities are themselves hybrid organizations, facing multiple stakeholders “with interests of nearly equal weight but potentially divergent directions”. We consequently argue that UniOne may be theorized as a hybrid organization, or, more precisely, as an organization in the process of hybridization, as it continuously faces different stakeholders and change itself.

Perspectives for UniOne and other private universities

Considering the need to expand higher education as well as the reduced investment capacity of the government, Brazil cleared the way for for-profit institutions (Andrade, 2012; Barreyro, 2008; Oliveira, 2009; Schwartzman & Schwartzman, 2002). This resulted in the creation of large institutions, such as UniOne, with a nationwide footprint and hundreds of thousands of students.

Private institutions have gained two important roles. The first role is that of drivers of social mobility. Brazil is an extremely unequal country where higher education can play an important role in promoting upward mobility (see Dabla-Norris, Kochlar, Suphaphiphat, Ricka & Tsounta, 2015). Institutions such as UniOne, which can provide education on a large scale at low cost, can help address this issue. This requires improving the mechanisms that regulate and assess education.

The second role is that of promoters of applied research conducted in partnership with companies to address practical problems. Because of their affinity for and proximity to the business world, private higher education institutions are in a privileged position to pursue this type of research.

Perspectives for professors and researchers

The number of Ph.D. degrees in Brazil has been increasing significantly. From 2,854 such degrees in 1996, this figure increased to 16,729 in 2014 (Centro de Gestão e Estudos Estratégicos [CGEE], 2015, p. 8). The increase in the number of Ph.D. holders was accompanied by two phenomena: the faster rise of private universities in relation to public universities and a severe economic crisis that, as of 2014, reduced the capacity of public universities to hire faculty (Safatle, 2014; Sguissardi, 2015; Vieira, 2018). With the pandemic, in 2020, the situation got even worse.

This meant that Ph.D. holders face a restricted job market. Consequently, many of them applied for jobs in private institutions, such as UniOne. In these institutions, the workload is bigger, while research is less valued. Moreover, many private institutions have strict control systems, which are perceived as curbing academic freedom.

This situation leads to three lines of action. First, regarding teaching, it is feasible to take advantage of the wave of changes brought about by innovations in technology. In a country with large territorial expanses such as Brazil, distance learning and hybrid learning can represent a legitimate and effective means of encouraging upward mobility. Moreover, the operation scale of large private educational institutions can enable the production of innovative, high-quality content created through collective effort.

Second, it is possible to align research with the practical approach employed by private universities. Indeed, such practical guidance is in line with current trends of change in the way knowledge is produced and can result in relevant research that generates a positive impact on society (George, 2016; George, Howard-Grenville, Aparna & Tihanyi, 2016).

Third, there will always be room for resisting antiquated command and control systems (see Bristow, Robinson & Ratle, 2017; Contu, 2008). It is not a matter of heroically fighting totalitarian systems but rather of challenging inefficient bureaucracies that are marked by ceremonial behaviors (Meyer & Rowan, 1977) and are capable of being refurbished through internal effort.

CONCLUSION

In this final section, we will, firstly, comment on limitations of this paper and propose directions for future studies; and secondly, present our final remarks.

Limitations and directions for future research

The main limitation of our study is that it was based on a unique case study. This put generalization beyond its ambitions. A second limitation is that we focus, by design, our interviews with professionals directly involved in the change process at UniOne. A more diverse set of interviewees, including, for instance, students, union leaders and staff representatives, might add other perspectives.

Considering these limitations, and other opportunities identified in the literature, we foresee the following possibilities for future studies: first, explore other cases of change at private institutions, through comparative studies, aiming at identifying patterns of change; second, explore cases of changes in public universities, in Brazil, aiming at better understand changes at organizational level, its challenges and difficulties; third, study the change processes from the perspectives of professors, students, and staff members, aiming at comprehend how these actors act and react to change, being at same time agents and subjects of change processes.

Final remarks

Considering its scale, fast expansion, and characteristics, the transformation of higher education in Brazil represents a privileged laboratory where one can observe alternative models, evaluate impacts, and identify ambiguities and challenges.

The ethos of the Brazilian public university is based on the principles of academic freedom and university autonomy (Lynch & Ivancheva, 2015). However, for a long time, universities represented a system created and maintained by an elite and designed to educate members of this very elite. Although the expansion of higher education and social-inclusion policies are gradually changing this characteristic, the system still has considerable inertia and tends to fend off any attempts at reform that are perceived - rightfully or not - as mercantilist. The current situation is one of decline. Following a period of expansion, Brazilian public universities are now facing serious problems associated with the lack of funding for research, restrictions on hiring faculty, and evasion.

Rather than being the nemeses of Brazilian public universities, private universities are their antipodes. Private universities adopt values and practices that are opposed to those espoused by public universities. They focus on a broader audience, who find it difficult to overcome the very competitive selection processes to enter public universities.

Some local critics (see Gotardo, 2016) believe there is a basic contradiction between the pursuit of profit and the capacity of providing high-quality education. However, considering the case presented in this paper, we believe it is possible to overcome the contradictions imposed by such conditions.

How to evolve? We contend that the role played by private universities, such as UniOne, can be improved through two vectors of change. First, the regulatory system could be improved to encourage a more substantial progress of teaching and (applied) research quality. Second, faculty could be engaged and mobilized. Professors represent the central agent of teaching and research processes. They also tend to occupy key positions in the administrative structure of universities. Their direct involvement can guide the direction of the institutions.

We started this article mentioning the metaphor of McDonaldization (Hartley 1995; Hayes, 2007; Hayes & Wynyard 2002a, 2002b; Nadolny & Ryan, 2015; Ritzer 2002). These days, fast education may be as ingrained in Brazilian society as fast food. It may not be wise to deny its relevance. It is essential to continue carrying out critical analyses and pursuing the bases that support their reform and promote healthier diets and, ultimately, the common good (Boyadjieva & Ilieva-Trichkova, 2019).

AKNOWLEDGEMENTS

The authors are grateful to UniOne managers, professors and researchers, for their openness and transparence in the field work, and the anonymous reviewers, for their valuable suggestions.

This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sectors.

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• [Original version]

Publication Dates

• Publication in this collection
  16 May 2022
• Date of issue
  Mar-Apr 2022

History

• Received
  16 Apr 2021
• Accepted
  13 July 2021