Universities should emulate US coffee chain Starbucks to keep students happy, a vice-chancellor has said.

Janet Beer, vice-chancellor of Oxford Brookes University, made the suggestion as she discussed how institutions could respond to students' changing attitudes to university.

"Social life is shifting away from the campus; they are in university to study and improve their prospects," she said.

"We have to make sure that they can do the same things that they can do in Starbucks; they can switch on their machines and have coffee at the same time."

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Professor Beer's comments are quoted in a report on the sector's "achievements, challenges and prospects", published by the Higher Education Funding Council for England.

She was speaking at an event at the London School of Economics alongside David Eastwood, chief executive of Hefce, Sir Mark Walport, chief executive of the Wellcome Trust, and Ed Smith, chairman of Hefce's Governance and Management Strategic Advisory Committee.

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During a wide-ranging discussion, Mr Smith, formerly a senior partner at accountancy firm PricewaterhouseCoopers, warned that universities were "not what I would call 'agile' in the private-sector sense of the word".

To remedy this, they would have to develop a greater focus on "speed, changing operating models, brand, mission and reputation".

Sir Mark added: "Many (universities don't have) modern models of governance... they have got to improve their executive and governance functions."

Professor Eastwood painted a picture of higher education as "too hermetic, too self-referential".

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"It is unwilling to partner with Government and policymakers in a rich way, and there is a default position that we know our business best. Do you think that's right?" he asked.

The panel also raised concerns about the UK's research and development, with Sir Mark warning that "the status quo is not going to deliver the science of the future".

Finally, the group touched on the threats and opportunities presented by the recession.

Mr Smith refused to be too downbeat: "This is a global economic recession, but it is not the end of the planet. Don't (be) alarmed by it - take action."

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Professor Eastwood agreed, suggesting that institutions should put their autonomy to good use to find a way through the crisis.

He said: "What we will see is some institutions that put themselves in a position to thrive when the recovery comes, and others that find themselves quite challenged."

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john.gill@tsleducation.com.