Universities’ $750 million spend on consultancies and professional services last year has raised questions.
Australia's universities have come under fire for spending a large amount of money on external consultants, sparking the obvious question of whether these institutions should make better use of the expertise within their ranks.
The nation’s 38 public-funded universities collectively spent almost $750 million on consultancies and professional services last year, according to the National Tertiary Education Union’s Ending Bad Governance for Good report.
The union claims this spending propped up an “overpaid executive class” while ignoring the vast intellectual resources sitting within the universities.
Universities are home to extraordinary pools of knowledge; academics and staff who not only possess world-class expertise, but also have a deep understanding of their institution’s culture, values and unique challenges.
Yet despite these significant in-house resources, opportunities to leverage this expertise often go unfulfilled.
Academics in architecture schools, for instance, could play a central role in campus redevelopment projects by designing buildings that reflect a university’s identity while meeting its functional needs.
In the same vein, engineering academics – particularly those specialising in sustainability – could guide infrastructure projects to improve energy efficiency or retrofit existing facilities, ensuring alignment with environmental goals.
Human resources specialists within universities could address pressing issues such as workforce planning, equitable workload distribution and employee engagement, offering tailored solutions informed by their understanding of the academic environment.
Even public relations academics could lend their expertise during times of crisis, or to refine the institution’s communication strategies to ensure they align with its mission and values.
Despite these obvious advantages, why do universities not rely more on their internal expertise?
One reason is the perception external consultants bring a greater level of impartiality and broader industry insight.
Consultants often deliver polished reports and high-level presentations that can impress stakeholders and governing bodies.
Another issue is capacity.
Academics and staff are stretched thin managing the demands of teaching, research and administration, leaving little time to take on major projects.
Outsourcing, while expensive, often seems the easier option.
There is also a cultural bias in some institutions towards outsourcing.
Engaging external consultants can signal progressive decision-making and, at times, shift responsibility for contentious decisions away from leadership.
This is convenient when strategies fail as it insulates those in charge from blame.
However, overreliance on external consultants sends an inadvertent, yet damaging message.
Internally, it undermines morale by suggesting the skills and knowledge of university staff are undervalued.
This risks creating a divide between leadership and the broader university community as staff feel sidelined in decisions that directly affect them.
Externally, the implications are just as troubling.
For prospective students, alumni, parents and industry partners, bypassing internal expertise can signal a lack of confidence in the university’s core strengths.
As institutions that position themselves as centres of knowledge and innovation, universities that rely too heavily on external advice might appear hypocritical and spark questions about whether they practise what they preach.
Such contradictions can undermine their credibility, potentially weakening their appeal to students, funding bodies and industry collaborators.
A more balanced, hybrid approach could address these issues.
By actively involving academics and staff in key projects, universities could tap into their institutional knowledge while reinforcing their commitment to their people.
Where additional capacity or expertise is needed, external consultants could be brought in to complement, not replace, internal efforts.
For instance, engineering academics could take the lead on sustainability aspects of a campus redevelopment, supported by consultants with experience managing large-scale infrastructure budgets.
Similarly, public relations academics could drive a crisis response plan, drawing on their understanding of the university’s unique audience, while consultants might assist with broader stakeholder engagement.
This collaborative model not only reduces reliance on external consultants but ensures solutions are contextually relevant, financially responsible and better aligned with the institution’s mission.
More importantly, such collaboration sends the powerful message – to staff, students and the wider community – that the university values and trusts its own people.
By striking this balance, a university can foster a culture of inclusion, collaboration and confidence.
It is a model that not only saves costs but reinforces the institution’s role as a beacon of knowledge and innovation, staying true to the values it seeks to promote.
• Professor Gary Martin is chief executive officer of the Australian Institute of Management WA
