Our external environment
Various factors in our external environment affect our capitals and consequently our ability to create value for ourselves and our stakeholders. The event that took the world by storm during 2020 and 2021 and severely influenced life as we knew it, was undoubtedly the Covid-19 pandemic.
In the text below, we discuss other material factors in our external environment that affect us directly or indirectly. We also indicate how these are linked to our strategic goals and risks, and how these impact our value-creation ability.
Click on each tab below to read more.
Rapidly changing societal roles/ views/perceptions
The university environment is a microcosm of the larger South African and global society, where evolving views on gender, cultural, sexual and religious diversity are mirrored within student communities.
We have been seeing increasing support among students for social movements focused on the eradication of racism and gender-based violence, the reconceptualisation of gender roles and norms, improved engagement and service delivery, sustainable transformation and cultural reforms.
The Covid-19 pandemic exposed inequalities in students’ access to technology and the basic infrastructure needed to effectively engage in university business and services. This added an additional layer of complexity to the management of student matters and we are only now starting to better understand the true impact of inequality on student access and success.
Strategic matter affected: development of a clearly differentiated student value proposition (goal no 4)
Capitals affected: human, social and relationship, financial
Risks involved: 2 and 5 – refer to Material risks and opportunities impacting value
Effect on value creation
The inability to timeously and effectively address changing societal perspectives and needs poses a risk in that inaction can be seen as further excluding and marginalising the people impacted by such changes. This could erode the relevance of the student value proposition that we promote. Therefore, we have to ensure that our value proposition is sufficiently agile to enable the university to respond appropriately and timeously.
Our strategic response
Our strategic response consists of purpose-driven engagements and structured feedback mechanisms, which ultimately inform our decision-making and policy development processes.
This approach allows us to respond to projected changes proactively, which helps us to maintain a relevant and valuable student experience.
Possible social instability in the higher education sector
Social instability within the higher education sector could influence the way our students receive and respond to university messages. If there is scepticism and resistance, this could be compounded by a lack of understanding of how the higher education sphere functions at a national and institutional level.
Strategic matter affected: development of a clearly differentiated student value proposition (goal no 4)
Capitals affected: human, social and relationship, financial
Risks involved: 2 and 5 – refer to Material risks and opportunities impacting value
Effect on value creation
When stakeholders resist NWU messages, this could delay and frustrate the development and eventual implementation of sustainable resolutions that advance the business of the university.
Our strategic response
Our communication and consultation strategy is inclusive, involving staff, students and community stakeholders. One of our aims is to enhance stakeholders’ understanding of the roles and responsibilities of the university. With this in mind, we emphasise the development of the key elements of the student value proposition. This goes beyond co-curricular offerings and includes efficient and interactive service delivery across the NWU’s service-orientated spheres.
The Fourth Industrial Revolution
No longer a futuristic concept, the Fourth Industrial Revolution (4IR) is well underway. In addition to new 4IR skills that universities should be teaching students, the impact of technological advances is also being felt in academic administration and student support.
In the race to adapt, universities will increasingly compete for scares ICT innovation skills, which will play an increasingly important role in facilitation the provision of teaching and learning and support throughout the student life cycle.
Strategic matter affected: teaching and learning (goal no 1), financial sustainability (enabler 4)
Capitals affected: All capitals
Risks involved: 2, 3, 5, 6 and 8 – refer to Material risks and opportunities impacting value
Effect on value creation
The NWU is focused on implementing ICT innovation to support our core business, broadening access to tertiary studies through online teaching and learning and being part of global trends such as the multiversity, the unbundled university and the blockchain university.
Our strategic response
he development of an NWU digital business strategy for the 4IR was already well under way when the Covid-19 pandemic changed the world as we knew it. The ensuing lockdown and accompanying shift to online learning saw us accelerating our digital journey in teaching and learning, student support and workplace practices.
Some of the milestones in the NWU’s digital transformation so far, include the planned implementation of a leading-edge student information system and an automated system for managing students’ work-integrated and service-learning placements.
We have also introduced a new digital workplace environment to improve workplace efficiencies and mobilised a team of education technologists to assist staff with the integration of technology into their teaching strategies.
Academic staff shortages
The pool of academic staff in South Africa is limited, especially from designated groups at senior levels and in the scarce and critical skills.
Strategic matter affected: teaching and learning (goal no 1)
Capitals affected: ntellectual, human, social and relationship, financial
Risks involved: 2 and 3 – refer to Material risks and opportunities impacting value
Effect on value creation
Failing to attract sufficient staff with the requisite demographic diversity, skills and experience may detract from our reputation for excellence and, amongst others, limit our capacity to implement functional multilingualism. Recruitment challenges also cause an overreliance on temporary staff, which is far from ideal for our core business capacity.
Another staff-related constraint is that the Covid-19 pandemic has necessitated special cost-containment measures such as placing a moratorium on positions. Careful consideration is being given to academic positions so that the academic service offerings are not compromised.
Our strategic response
Our line managers have been tasked with identifying and fast-tracking professionally qualified academics from designated groups.
Our talent-management strategy provides incentives and professional development to attract and retain scarce skills, particularly with regard to black academics.
Despite uncertainties associated with the Covid-19 pandemic, we resumed the individual remuneration review process in 2021 to ensure fair, market-related pay, demonstrating the importance we attach to staff remuneration.
Fee-free higher education affects financing model
The number of NSFAS-qualifying students has increased by approximately 396% since 2015, placing pressure on all our internal business processes dealing with financial aid. Where there were 4 837 approved NSFAS students in 2015, the number climbed to 23 996 in 2021.
Strategic matter affected: teaching and learning (goal no 1), financial sustainability (enabler 4)
Capitals affected: inancial, human, intellectual
Risks involved: 1, 3, 5 and 8 – refer to Material risks and opportunities impacting value
Effect on value creation
The greatest risk to value creation remains the potential unsustainability of the NSFAS model and the proposed Fee Regulation Model, and the financial impact it could have on the NWU and our students.
Our strategic response
In 2021, in managing the challenges posed by the increased number of students qualifying for NSFAS and the associated administrative demands, we harnessed effective administrative processes and kept staff and students informed of developments around financial aid. We also continued to build our long-standing relationship with NSFAS and the DHET as valued stakeholders.
Fee regulation by the DHET
The DHET is in the process of formulating a Fee Regulation Framework for the public higher education system. In the meantime, the Minister has recommended CPI-related increases in fees since fee-free education was announced and that also has a significant influence on our funding model. A tuition-fee increase of 4,7% was implemented in 2021 in line with the recommendation from the Minister.
Strategic matter affected: financial sustainability (enabler no 4)
Capitals affected: inancial, intellectual, human
Risks involved: 1 – refer to Material risks and opportunities impacting value
Effect on value creation
Fee regulation could put our financial stability at risk if the permitted increases do not reflect our cost structure and internal inflation rate. This may ultimately affect the quality of the services we provide and may erode the autonomy of universities.
Our strategic response
We have a multifaceted strategy to manage the complex task of maintaining financial stability and the quality of our services. This includes making a positive contribution to the consultation process on the proposed Fee Regulation Framework, identifying opportunities to increase our income, managing our budget process and improving operating cost efficiency.
State funding
The Rand value of the block allocated to the university increased by 3,5% and the value of the earmarked grants allocated to universities decreased by 19,5% from 2020 to 2021. This was after adjustments were made in order to assist NSFAS in partially funding the shortfall for 2021. This will not fully cover higher-education inflation in the long run, and in fact represents a decline in state funding in real terms.
Strategic matter affected: teaching and learning (goal no 1), research and innovation (goal 2), student value proposition (goal 4) staff profile (goal no 5), financial sustainability (enabler 4)
Capitals affected: human, financial, intellectual
Risks involved: 1, 3 and 8 – refer to Material risks and opportunities impacting value
Effect on value creation
If we were to experience funding shortfalls, we would have to respond with budget cuts and would not then be able to fund all operational and strategic activities. In the short and medium term, however, the funding provided by the state does contribute to financial stability, bearing in mind that the impact of Covid-19 on future state funding is still unknown.
Our strategic response
We prioritise wisely when allocating the funds available while continuously investing in opportunities to improve cost effectiveness, build reserves, practise disciplined cost management, evaluate the viability of academic programmes and focus on supporting cost reduction. As a longer-term strategy, the NWU’s focus is to become less dependent on state funding by diversifying income generation.
External research funding declines
Owing to the pandemic, most government and industry funding agencies reduced or even discontinued research funding and support.
Postgraduate funding declined following funding cuts and the implementation of the new NRF funding instrument, which saw fewer students being funded, although the amount per student increased.
Strategic matter affected: research and innovation (goal no 2)
Capitals affected: financial, intellectual, human, social and relationship
Risks involved: 3 and 7 – refer to Material risks and opportunities impacting value
Effect on value creation
Less external research funding may adversely affect our research productivity and the standing of the university in national and international rankings. At this point, research journal outputs have not been negatively affected, but due to international travel bans in 2021, international conference proceedings outputs declined.
Our strategic response
We provided support in the form of mobility grants (R1 507 505) and research mentorship (R708 700), including assistance with NRF-rating applications. We also contributed R1 168 760 to the salary component of the research chairs.
Demand for Intellectual Property (IP) reduced
Amid economic constraints, there was less private sector interest in licensing our intellectual property (IP) and technology, and a reduction in the flow of early-stage, seed and venture capital funding for NWU start-ups.
Strategic matter affected: research and innovation (goal no 2)
Capitals affected: financial, intellectual, human, social and relationship
Risks involved: 3 – refer to Material risks and opportunities impacting value
Effect on value creation
Some of the possible consequences of low uptake of our IP and technologies are lost income and reduced licensing and spin-off activities.
Our strategic response
Vulnerability to funding fluctuations across economic cycles can be mitigated by taking a long-term view of funding and taking steps to develop and maintain good relationships with funders. By engaging with industry, we gain a deeper understanding of their needs and challenges and can respond with relevant solutions and innovations.
(For more information, see Becoming greater through innovation and technology.)
Challenges in recruiting international students
Stricter visa requirements for international students, the DHET requirement that the universities should prioritise South African students for postgraduate studies and the travel restrictions during the pandemic resulted in a decline in the number of international students registered with the NWU.
Strategic matter affected: research and innovation (goal no 2)
Capitals affected: financial, human, social and relationships
Risks involved: 3 – refer to Material risks and opportunities impacting value
Effect on value creation
The number of international students enrolled at the NWU decreased from 6% of the total cohort of postgraduate students in 2016 to about 3% in 2021, which may lead to lower global rankings.
Our strategic response
The NWU now has global engagement offices on all three campuses, enabling us to offer higher levels of administrative assistance to international students and making it easier for them to study with the NWU.
National call for greater access to universities
It remains a priority for the NWU to widen access to as many qualifying students as possible.
The Faculty of Health Sciences’ planned Higher Certificate in Health Promotion will open access to the envisaged four-year professional bachelor’s degree in Public Health, while the Faculty of Economic and Management Sciences is in the process of recurriculating 14 extended curriculum programmes for improved student success.
These two alternative admission pathways will allow students who do not meet admission requirements an opportunity they would otherwise not have had to access higher education.
Strategic matter affected: teaching and learning (goal no 1)
Capitals affected: intellectual, human, social and relationship, financial
Risks involved: 2, 3 and 5 – refer to Material risks and opportunities impacting value
Effect on value creation
In 2021, through entry-level access qualifications, we continued our pursuit of higher education for the public good. The prospective students we target are persons already active in their respective fields, meaning that value is added immediately to the communities. These qualifications will progress to further qualifications in higher education, resulting in additional benefits for the students and the community.
We are also expanding our academic and counselling support services and programmes for students, creating an opportunity to generate even more value and increase our intellectual and human capital.
Our strategic response
Still on the subject of wider access, the NWU continues to offer extended curriculum programmes in the BSc, BCom and BAdmin areas, as well as an extended LLB programme. We are looking forward to reviewing the similar programmes in the Faculty of Economic and Management Sciences in 2022.
National call for curriculum change and transformation
The need to decolonise the curriculum in higher education, the Covid-19 pandemic that changed the way we teach and the way students learn, and the advent of the 4IR are driving curricular innovation.
Strategic matter affected: teaching and learning (goal no 1)
Capitals affected: intellectual, human, social and relationship, manufactured, financial
Risks involved: 2 and 3 – refer to Material risks and opportunities impacting value
Effect on value creation
Lockdown levels fluctuating between levels 4 and 1 throughout 2021 posed challenges for teaching and learning at the university.
Our strategic response
In response to the shifts occurring on multiple fronts, the NWU has deliberately embraced internal and external scrutiny of our modules and programmes to expand on teaching and learning opportunities and enhance the relevance, responsiveness and transformational potential of our academic offering.
In some cases, we have introduced new programmes while in others, we have adapted existing ones. New programmes that have received clearance or been registered in the past two years include five new postgraduate diplomas in nursing, three higher certificates in health, palliative care and theology and several qualifications in early childhood care and education, agriculture, and theology.
Regarding the challenges posed by the Covid-19 pandemic, the NWU used a hybrid modality for teaching and learning throughout the year and was able to continue its core activities without interruption and complete the 2021 academic year.
