“Being agile and flexible has been critical for educational institutions in adapting to Covid-19 disruptions, whether it’s optimizing online learning, replicating the student experience in a virtual environment or dealing with the multiple waves which have seen schools close and reopen several times. The impetus for change is now greater than ever; some of these changes are here to stay and all the stakeholders – schools, government parents, teachers and students – will have to play their part to make the transformation of education a success.” - Vicki Fan, CEO, Hong Kong, Mercer
Right now, at least 1.5 billion learners globally are affected by pandemic-driven school closures. In Hong Kong, education continuity has been disrupted for even longer by civil unrest and schools have had to make rapid changes in order to maintain education delivery.
The circumstantial disruptions will end, but transformation to the education sector is just beginning. The change journey taking place is not merely circumventing disruption, the sector is on a future-orientated trajectory.
From attendance modes and syllabus delivery, to staff wellbeing and financial sustainability, education is shifting away from what we have known. The transformation is driven by four key trends:
The burgeoning drivers mean that change is no longer a choice but a constant. Strategic transformation is essential to any institution’s future relevance and viability.
Vicki Fan, CEO of Mercer in Hong Kong, notes, “Many academic institutions have proud histories, with that though, often come challenges with change agility. The sector needs to transition with the kind of imagination it encourages in its students.”
There are five key change spheres: technology, the role of educators, wellbeing, financial sustainability and M&A.
It is time for institutions to move out of crisis management mode, go beyond facilitating remote learning and look to the future. Darryl Parrant, Career business leader, Hong Kong, Mercer, says, “We know from research that technologies will continue to advance. Schools need a digital roadmap. They should be planning and thinking through how they will approach their operating model and learning journey for students and key stakeholders. Institutes of higher learning need to review curriculum and programs to align to emerging skills and future skills to better prepare students for the future workforce. We know that by the time children entering primary school today finish high school, 65% of them will enter into a job that doesn’t currently exist – are they prepared? It is critical to start the digital journey now to remain competitive and sustainable in the future, particularly for private education providers.”
What is needed now:
Parrant sees enormous changes for teachers, “New teacher roles and skillsets are emerging, and the educator’s career track is evolving. Rather than delivering content, teachers now in effect learn alongside their digital-native students in ‘superlabs’. In each class, there is more focus on creativity, communication, collaborative learning and critical thinking, which all add up to a new social model for learning.”
What is needed now:
The entire education ecosystem needs to rethink wellbeing as rapid changes impact all stakeholders. The sector is effectively the nursery of future human capital so the physical and emotional wellbeing of everyone involved are vital considerations. We must ensure teachers are healthy so they can continue delivering quality education and students’ experiences are cultivated instead of compromised, especially in remote learning.
Research has shown that educator wellbeing has implications far beyond the personal – teacher wellbeing can and does significantly affect student-teacher relationships and therefore educational outcomes, says Richard Roper, Health business leader, Hong Kong, Mercer. “Negative effects can be exacerbated during difficult times, but institutions can do something about this, beginning with increasing focus on physical and mental wellness.”
What is needed now:
Top of mind for many institutions is balancing the need for cash to pay short-term bills while meeting long-term investment strategy commitments. Adeline Tan, Mercer’s Wealth business leader for Hong Kong explains, “The sector is likely to come under pressure to compete, so spending and investing have to be looked at in tandem. Similar to the way they are thinking about education, the sector should seek innovation in their investments, and explore doing things differently. We note ESG integration is an area in which Hong Kong institutions is keen to build capacity and develop.
“Investment committees (ICs) have to rethink how they organize their portfolios and review if they are executing investment decisions well. There is also the need to ensure IC members have more support and sufficient knowledge and experience as the choices broaden across asset classes and management firms.”
What is needed now:
M&A can present substantial growth and diversification opportunities in the steep economic recovery we are facing. The education market is expanding in many areas; increasing demand can be seen in K-12, extracurricular training & tutorial, international school, online learning and ed-tech. This time of change we are experiencing presents interesting investment opportunities in the already active Hong Kong-China education M&A market.
What is needed now:
The onset of the pandemic has triggered a seismic shift in the education landscape as learning migrated online en masse. But beyond ensuring lesson continuity with the right digital tools, educational institutions and educators now have an opportunity to reimagine education to deliver better learning outcomes and grow more sustainably. Think about the following questions:
Mercer is committed to working with educational institutions on their transformation journey. Take the important first step of speaking with us for an assessment of where you are on your strategy, people management and operational practices.
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