I had a strange dream the other night. I woke up as the chancellor of a large Australian university.

Tens of thousands of students. Billions in revenue. A sprawling campus and an even more sprawling set of problems. 

So I did what any demographer would do. I went straight to the numbers.

Australian universities are no longer just places of learning, they are complex financial machines. At many large institutions more than half of all revenue is tied to students. And within that, international students often provide the single biggest marginal dollar. 

My first decision as chancellor was a drastic one. I capped international student numbers. Not at a fixed number but at a ratio.

No more than a third of total enrolments can be international students. My campus remains very international in nature. The goal isn’t to get rid of international students but to increase the amount of inter-cultural learning.

Another goal is to remove the financial dependency on international student fees that my university has quietly fallen into. 

My chief financial officer nearly had a heart attack.

“Are you insane?” he asked. “Half our students are international. They pay $50,000 to $70,000 a year. You’re blowing up the entire budget.”

He wasn’t wrong. A university that relies too heavily on one revenue stream will inevitably shape itself around that revenue stream.

If your financial survival depends on keeping students enrolled, you start optimising for retention. And retention is much easier when learning feels smooth, supported, and – dare I say – gamified. 

Which brings me to the second problem I noticed in my dream.

Australia now sends around 55 per cent of school leavers to university. That’s a reflection of the changing nature of work – our national economy transitions into a knowledge economy and just needs more university-trained worker bees. But it changes the nature of the institution.

Universities used to educate a small, highly selected group of students. Today they educate the majority. 

“University students were smarter in the past”, seems an obviously a true statement.

In 1950 only about 5 per cent of Australians went to university – that means the cohort of university students was made up of the intellectual elite of the country.

Today,........

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