How to fix Canada's broke universities? There's a template for that

It was Matt Durnin, principal of the consultancy Nous Group, who first mentioned his company’s horrific nickname.

In an interview about Nous’s swift and controversial rise to dominance of Canada’s market in strategic management advice to universities, Durnin said Nous remains a company that is “small enough to have a bit of personality.”

So it does. Trouble is, that personality has a dark side. The nickname is “Nousferatu,” as in the vampire, because of what critics describe as a reputation for selling a slash-and-burn template for saving bankrupt universities by making them go ruthlessly corporate; by streamlining campus governance to concentrate power at the top; by guiding university administrations in cuts to staff and programs that arguably compromise their core mission; and by tracking dubious “benchmarks” for performance evaluation in a single-minded pursuit of budget efficiency.

At the 20 or so major Canadian universities where Nous has showed up since the pandemic, the nickname has caught on, and at their upper-floor headquarters in Toronto’s financial district, Nous itself seems to revel in it.

“I’d wear it on a T-shirt,” Durnin said.

In barely five years, this consultancy founded in Australia by ex-McKinsey types (although Durnin said Nous is as much a “reaction” to the larger consulting firm’s intense corporate culture as a “descendant” of it) has capitalized on Canada’s crisis in university financing.

Nous arrived in 2019 to find their new clients struggling against inflation, in many cases with tuition frozen and operating grants stagnant, but with budgets balanced thanks to high-paying foreign students, whose numbers have since been deeply cut with no new revenue stream to replace their tuition.

Every Canadian university suddenly seemed to have the same problem. This is fertile ground for consulting, particularly if, like Nous’s model, it is based on extensive surveys and benchmarks to compare institutions against each other.

So Nous’s experience at the University of Sydney, for example, informed their earliest Canadian work on Laurentian University’s plan to emerge from insolvency, which then informed their work at the University of Alberta, which informed their work at Queen’s, which is informing their work today at McGill, Waterloo and others.

This is Nous. Most people have not heard of it. It rhymes with “mouse,” and derives from the Greek word for reason, not the French word for us. In Britain and Australia, to say someone has a “nous” for something is to say they have an intuitive knowledge, a clever knack, a useful insight. But it does not have the same currency in Canadian English. It is a witticism that has failed to translate cultures and is just as likely to be pronounced in Canadian academia these days as “noose,” often with a wisecrack about hanging.

The way their most strident critics see it, Nous is rebuilding the ivory tower with everyone still inside. And like their nicknamesake vampire, someone had to invite them in.

This success in Canada has taken Nous Group from a small Australian consultancy to the purveyor of the driving strategic management vision of many, if not most, big Canadian universities, more than 20 across almost every province, with similar work in the United Kingdom.

A new office in Vancouver this year testifies to growing work in the Canadian West, after leading the University of Alberta’s major restructuring in 2020, and encountering their first major campus pushback at Queen’s last year.

That uproar, which forced the school’s principal into a damage-control CBC Radio interview, was prompted by a new provost who, in December 2023, told a faculty town hall about major budget cuts: “Unless we sort this out, we will go under.”

A week previously, Queen’s had signed its client service agreement with Nous, with terms to create “an overarching narrative” of a “case for change.”

The provost’s threat that Queen’s would “go under,” however, made that narrative spin out of control. Faculty got their backs up. Department heads spoke out to say the budget cuts were  being dictated from on high in a hurried  panic , guided by blunt strategy. They said the proposed elimination of any course with fewer than 10 students would mean the end of foreign language instruction, except maybe German; it would keep senior students in everything from chemistry to art conservation out of special lab work; and it would mean the classics department would no longer offer Latin or Greek.

Today, Nous consultants are at work at York University in Toronto, where James Andrew Smith is an associate professor in the department of electrical engineering and computer science.

“Central management has a crisis narrative,” he said in an interview. “That’s never said out loud. Nobody wants to invoke Laurentian (in Sudbury, Ont., which filed for creditor protection in 2021 and closed programs, the first and only publicly funded Canadian university ever to do so). It gets phrased as, ‘We don’t have enough money, so you’re going to have to give up resources and services.’ And then they take the money away.”

He just doesn’t believe in this crisis, not at a school that just opened a new campus in Markham, Ont., with plans for more expansion.

“It’s hard to reconcile a crisis of money when the university is spending and planning to spend hundreds of millions of dollars,” Smith said.

“I see that we’re a billion-dollar institution that’s pinching pennies when we should be spending money on innovation and providing better services to students and faculties,” he said. “You don’t get out of a crisis by doing less. You get out of crisis by doing more and better. If we follow through on centralization and amalgamation of work units at the university, we will make it less innovative, nimble and responsive to the world around us and our students.

“The problem is that centralizing decision-making and making middle management go up the chain for everything doesn’t make for a nimble or efficient organization … I think the strategic consultants are a waste of time and money,” Smith said.

His view is that there is a co-ordinated effort inspired by Nous to shift the blame for budget problems from chronic government underfunding to inefficient university overspending.

In the interview, Nous executives were blunt in rejecting this perspective.

“We don’t say the solution is you should advocate for more money,” said Tim Kennedy, also a Nous principal, a sort of non-equity partner.

Kennedy and Durnin were reluctant to speak in detail about individual clients or take credit for decisions made on their advice. But they did aim to correct what they see as rampant inaccuracies in campus gossip about their work.

Kennedy said the University of Alberta is one of only two examples of advising on changing leadership structure, and they took that on because the project was moving at breakneck speed, with budget cuts of 20 per cent overnight.

The other was Laurentian University, where Nous worked on a management and operations review in the restructuring plan, af ter the shock of the insolvency and the loss of nearly 200 jobs in this unprecedented collapse of a public university.

“We were new and probably naive,” Kennedy said. But he noted they have been successful because they have been willing to look at difficult and contentious stuff.

Now, though, they bristle at getting all the negative attention, when larger consultancies such as Deloitte are doing similar work. Kennedy said the scrutiny that has come down on them, especially after the well-organized anti-austerity movement at Queen’s last year, makes it hard for university leaders to use Nous.

Still, they are finding a way.

Before Nous’s arrival in Canada, the university consulting game was dominated by big accounting firms whose work was primarily in systems technology, advocating expensive investment rather than shorter term transformative change.

It was a stroke of luck, then, for Nous to expand into Canada at a time when schools were in a funding crisis, with operating grants stagnant and tuition capped. No one wanted to upgrade their systems. They wanted to save money, find efficiencies, cut costs.

Since then, a cap on foreign students, who pay four times the tuition fees as Canadians, has delivered a further dent to university budgets. In Canada, post-secondary institutions have three main sources of funding: public money (provincial and federal), donations and tuition revenues.

“We arrived on the back of big-tech investments that did not deliver,” Durnin said.

Durnin expresses sympathy for university leaders, who are usually not used to making radical or extreme change but are almost forced by circumstance into it. Kennedy said Nous aims to give university leaders confidence in these hard decisions.

On campuses, public notice of Nous’s involvement is rarely trumpeted from the highest office. It often comes to wider knowledge when administrators start explaining why they have taken certain decisions, often about budgets, and how this will contribute to the university’s “renewal.”

Now, though, it is plain that Nous Group’s model of renewal is becoming a national standard for how to run a university in Canada.

Some critics say they need it, and more, that universities are stagnant and bloated, and selling an experience that won’t get students a job.

At its extreme, the view is that universities offer wide-eyed undergrads the chance to waste their parents’ and the government’s money on too many courses that are either loosey-goosey fripperies like sociology, or pseudo-intellectual indulgences like philosophy.

Nous is more sophisticated than this. They recognize the tight spot university leaders are in. Universities are neither glorified trade schools, meant to produce specific kinds of workers, nor glorified high schools, meant to teach everyone the same basic stuff. They aim higher, but they find it increasingly hard to afford it.

“I love the idea that funding will come back,” Durnin said. “I just don’t think that’s realistic.”

Kennedy said their role is to support “institutionally led” renewal. He said they do not advise cutting programs, that those decisions are all the product of university leadership. But when it’s pointed out that these cuts tend to happen when Nous is around, as when Queen’s proposed to eliminate any course with fewer than 10 students, Kennedy said they are simply a “good scapegoat.”

In fact, Kennedy said, cutting academic programs doesn’t even save money, a point also often made by Nous’s sharpest critics. What saves money are things such as making sure each faculty does not run its own human resources or information technology department, for example, but rather uses one for the whole school.

Provincial governments find program cuts politically attractive, Kennedy said, because they look like tough decisions and appeal to voters. What gets cut, though, rarely costs a lot of money in the first place.

The real way to balance a university budget is to measure inefficiency and eliminate it, Kennedy said. It is to compare the efforts of other schools with the same problems, and to emulate their successes while avoiding their failures.

“It’s not a race to the bottom. It’s what can you do with increasingly less budget,” Kennedy said.

He and Durnin evince a hint of smugness when they say university leaders should “lead” and be “financially literate,” as if that were a novelty.

They reject the accusations that they advise universities to “corporatize,” or “managerialize,” preferring the word “professionalize.”

But others think Nous’s “renewal” is a misleading concept, a sly branding of a corporatization mission that seeks only cost savings through blunt budget cuts justified by inflated claims of crisis based on hysterical readings of an increasingly complex table of benchmarks.

The Nous pitch makes it seem as if universities are just like taxis in the early days of Uber. “Transform,” they say. “Renew.” The “… or die” bit is merely implied.

For some politicians and partisans, this crisis narrative is basically what they already think and want to hear about universities. But for many who work in academia, there is an existential threat afoot.

“It feels to me like a race to the bottom,” said Rob Kristofferson, president of the Ontario Confederation of University Faculty Associations, who is also a historian at Wilfrid Laurier University in Waterloo, Ont. “We’re losing sight of the fact that universities need to be efficient, but they are not businesses. The faculty that I’ve talked to are very worried about these reviews.

“It’s more profitable to recycle the same solutions over and over again. In fact, we often see the same solutions in the reports we’ve seen,” Kristofferson said.

He said this “endless search of efficiencies distracts from the real problem, which is provincial underfunding.”

Universities know they must operate with care and efficiency, but the savings from strategic management reviews are a “drop in the bucket” compared to what’s needed, Kristofferson said. In not one of the reviews that OCUFA has seen have the recommendations come close to solving the school’s financial sustainability challenges, he said.

“Even if you implemented every recommendation, that university would still be going deep into the red going forward,” Kristofferson said.

So, like it or hate it, the idea is to take this old model of academia and make it new and efficient, relying heavily on data to track newly designated performance benchmarks, like a running report card that compares each ivory tower against the others in what Kennedy calls a “common language.”

One fundamental problem is that universities won’t ever be new again. There is no blank slate for a new vision, as at some plucky startup. Universities in general are older than constitutional monarchy, and some of Canada’s universities are older than Canada itself. They are not just stuck in their ways. They are embedded into economies, social structures, cities, provinces, civilization.

So, if a global consulting firm manages to create a large, streamlined university that runs according to corporate principles and evaluates its progress toward its goals via a proprietary model for benchmark tracking, juiced by artificial intelligence, and if it does all this inside of five years, that’s not “renewal.” That’s just “new.”

Nous’s “renewal” therefore looks more like reinvention, and not everyone in Canadian academia is OK with that project, or with outsourcing it to Bay Street suits.

When Nous comes to campus and gets down to work, it goes something like this: First, there is a contract. National Post has obtained the Client Services Agreement between Queen’s University and Nous Group Holdings, signed by Durnin in December 2023.

It says Nous will create a “transformation roadmap” that includes developing “an overarching narrative” of a “case for change” to guide the “sequencing and timing of major initiatives required to achieve the stated goals.”

It says Nous will create a “transformation office” to centrally co-ordinate this and promote “a single view of change.”

This agreement lists a pre-tax total price of $172,800.

But that is not all Nous offers. The Post has also obtained the extensively redacted Subscription Services Agreement between Queen’s and Cubane Consulting, which covers data collection, post-submission data review, a service effectiveness survey, and an overall services review workshop.

Nous bought Cubane and its survey system UniForum in 2021 after using it for several years.

This was the primary reason Nous was controversial on Canadian campuses before it even arrived. For example, in 2019, the use of UniForum surveys at the University of Toronto led to a union grievance and settlement. It ruled librarians did not have to submit to the survey or, indeed, as they saw it, to snitch on allegedly underperforming colleagues. In England, at University College London, academics similarly circulated a standard reply text to justify their unified refusal to take part in the survey, on similar grounds.

The agreement describes the legal terms for how Queen’s joined Cubane’s University Operations Forum on Dec. 1, 2023.

UniForum is described in the contract as “a private forum for Universities who want to work together to improve efficiency and effectiveness of support services at their University. The Forum provides the means to collaborate in structured studies with the support of facilitators. The objectives of the studies are to improve the efficiency and effectiveness of support services operations at the Participating Universities.”

These include (but are not limited to) universities in Australia and New Zealand as well as Canada, the contract says.

Some universities hire Nous for consulting but do not join UniForum, and vice versa, Kennedy said. But often they are bought as a complementary package.

National Post has obtained one of these UniForum surveys, which was taken of administrators at a Canadian university.

Offering a scale from “less important” to “critical,” it asks the respondent to say how important various services and supports are to their work. It also asks them to measure their present satisfaction.

These include financial services, such as support to prepare and use budgets, manage accounts and annual reports, and access to preferred suppliers “for tendering for major equipment or services.”

The survey asks the same about the university’s marketing to Canadian undergraduate students and recruiting of graduate students; support in running websites; and “support for developing and managing marketing material and accessing media coverage for my unit.”

It asks about support in applying for grants; complying with research integrity and ethics rules; commercializing research and legal support for research agreements.

It asks about information technology support, building maintenance and general office administration, such as buying materials and services for day-to-day work, co-ordinating travel details, and managing university-issued credit cards and personal expenses.

It asks about support in managing discipline and grievances, exams and special consideration processes, and monitoring graduate students’ progress in research programs from thesis to examination.

It asks, in short, about everything a university administrator might do.

It asks about everything. The results, therefore, are a measure of everything. Or so seems the promise. Somewhere in those results lies a way to make universities fiscally sound. Somewhere in those numbers is a problem to which “renewal” is the solution.

To use the common corporate metaphor of fat, flesh and bone, this survey purports to be a scan to bring the fat into focus. Then you just cut it out.

Durnin insists that the benchmarks don’t give you answers, they just help you ask the right questions.

But a reputation as villainous bean-counters is at least a reputation. Things were looking good for the business of offering crisis advice to broke universities.

“Canada offers an exciting growth opportunity for Nous and I am thrilled that we are able to expand our team there,” said Tim Orton, the Australian founder and managing director of Nous Group, in October 2020. How could a man with a name like that fail to succeed in Canada?

“Our higher-education clients in Canada are already experiencing the benefits of our expertise, developed over more than 20 years, and we look forward to welcoming more clients in that sector and others,” Orton said.

Durnin said they initially saw the Canadian landscape as historically well-funded, but on a downward trajectory that did not look like it would ever get better. For a consultancy, that’s a rosy picture. And it has held up. Canadian universities are still in crisis. Dalhousie University, for example, which joined UniForum in 2022, issued a lockout notice to faculty on Aug. 20 over a contract dispute spurred by a budget deficit.

Deb Verhoeven is a professor of women’s and gender studies at the University of Alberta who has closely followed Nous’s growth both in her native Australia and in Canada.

She describes a new rhythm settling into universities, especially the University of Alberta, in which middle-ranking administrators feel their fate is “informally tethered to the top dog,” and so there is a general sense of precarity, in which nothing is certain because senior management is just going to change again in a few years.

University leadership is becoming a class apart, she said, no longer senior academics who have risen through the campus ranks, but more like movable CEOs.

She argues that this process of “managerialization” is accelerated when the all-important benchmark data is considered the property of senior administrators.

Kennedy acknowledges a cultural change in university leadership, especially in the role of the provost, once a stepping-stone toward the top office, now more of a mercenary position, destined for a “one and done” term of employment as the person to blame for hard cost-cutting decisions.

Long before Nous got tagged with the Nousferatu nickname, the vampire metaphor was frequently summoned in criticism of big money institutions such as universities and banks.

Karl Marx, the original critic of capitalism’s Gothic dark side, wrote that “Capital is dead labour, which, vampire-like, lives only by sucking living labour, and lives the more, the more labour it sucks.”

The writer Matt Taibbi famously described investment bank Goldman Sachs in Rolling Stone magazine in 2010 as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”

Similarly, Verhoeven and colleague Ben Eltham applied the metaphor to Nous after observing its early work in Australia and Alberta, and drawing a crucial distinction between vampires and zombies.

In a 2024 edition of the journal Review of Education, Pedagogy and Cultural Studies, they wrote: “Universities and management consultants are locked in a danse macabre … a mutually dependent relationship designed to sustain each other at the expense of the public.”

“We question the implicit proposal of a pre-history of university innocence corrupted by brutal exterior forces into unrecognizable monstrosities,” they wrote. “Rather than see universities or academics as victims of involuntary transformation who have retreated into sordid states of survival, we might wonder at the ways in which universities, and many managerial academics, have actively participated in the systems that now characterize these workplaces.”

In other words, the fate of the modern Canadian university experience, in which every school hires the same consultancy for the same kind of renewal, is not a zombie story about some foreign virus infecting pure minds, evacuating their brains.

Quite the contrary. It’s a vampire story, about vice-chancellors being promised new life indefinitely, endless renewal, in exchange for blood.

Zombies bring about wastelands devoid of humanity. But “vampires work together to reestablish the systems they menace, and this makes them especially useful for understanding the mutually beneficial role of consultants in the processes of corporatization of public institutions like universities,” Verhoeven and Eltham wrote. You can’t just blame the vampire. Their victims invited their own fate and paid handsomely for it.

So, as they expose their necks to consultants, the danger to Canada’s top universities is not that they could become brain-dead. It is that they could become consultancies.