Rethinking the boundaries of the academic library

Lorcan Dempsey, Vice President, OCLC Research and Chief Strategist

Brian Lavoie, Research Scientist

The shift to network technologies will change the mixture of internalized and externalized library services

By Brian Lavoie and Lorcan Dempsey*

Speculation on the future of the academic library has been spurred by the idea that technological change has created opportunities to reconsider what libraries should do and how they should do it. Economic pressures have added urgency to these discussions, as libraries face the necessity of leveraging technological change as a means of reconfiguring resource allocations in ways that allow them to do more with less in a lingering climate of austerity.

This article describes a framework to aid discussions about the future of academic libraries. The framework is built around the concept of transaction costs, which help organize thinking about the dynamic forces acting on and reshaping universities and their libraries. The framework also has some application to public libraries, acknowledging, however, significant differences in the decision-making environments in which academic and public libraries operate.

What are transaction costs?

Transaction costs are special costs involved in arranging for someone to do something for you rather than doing it yourself. Effort must be devoted to finding an appropriate provider or collaboration partner; agreement must be reached on the services that will be delivered, how they will be delivered, and at what cost; monitoring may be necessary to ensure that the terms of the agreement are observed by all parties. In short, interacting with outside parties entails costs—time, effort and money—to make the transaction work. Transaction costs are usually analyzed in the context of market transactions, but are also relevant to nonmarket interactions like collaborations with partners to collectively provide a shared service.

An academic library is a bundle of information-related resources and services that a university has chosen to provide internally, rather than transact for them with external parties.

A crucial factor in determining which resources and services to provide internally, and which to transact for externally, is the prevailing pattern of transaction costs. The higher the transaction costs associated with a service—that is, the greater the frictions in sourcing it with an external party—the more likely the university will choose to internalize provision of that service. In this way, the boundaries of the library are established: the demarcation between the information-related services the university chooses to provide internally, and those that it transacts for externally.

Transaction costs help explain why academic libraries look the way they do today, in terms of the current balance between internalized and externalized services. But they also provide insight into how the boundaries of the library shift over time. As the pattern of transaction costs change, so too will the boundaries of the library as the optimal mix between internalized and externalized services shifts accordingly.

The network reconfigures boundaries

A key driver currently shifting the pattern of transaction costs is the network. Much of society has been transformed by computing and network technologies that significantly reduce the cost of establishing and managing interactions with external parties. Reductions in the relative cost of externalization provide an incentive to rebalance the mixture of internalized and externalized services through which organizations accomplish their strategic goals. The network is reconfiguring organizational boundaries everywhere, and academic libraries are no exception.

Cooperative cataloging is an early example of how the network has shifted the boundaries of the library. Computing and network technologies significantly reduced the cost of pooling cataloging output among libraries through online databases accessed through network connections. As online cataloging became available, academic libraries (as well as other libraries) were able to shift a considerable portion of their internal cataloging activity to an external cooperative network.

More recently, the network has reconfigured the boundaries of the library in regard to the scholarly journal literature. In contrast to print journals, e-journals usually remain in the custody of publishers rather than libraries, with access occurring over the network. Consequently, the day-to-day maintenance and long-term preservation of much of the scholarly journal literature—activities that universities traditionally internalized within their libraries—are now increasingly carried out by publishers or third-party services like JSTOR and Portico.

Discovery services are yet another example of a traditional library service that has been reconfigured by the network. In the past, nearly all discovery services operating on library collections were provided through the library itself, whether in the form of card catalogs or more recently, OPACs. While internally provided discovery services are still available from the library, much discovery occurs through other sources. For example, a reader searching Google Books can be directed, through the “Find in a Library” service, to copies available at the local library. Here again, a service traditionally internalized within the library is now at least partially externalized as the network reduces the frictions of interacting with outside parties.

A new mix of services

As the network shifts the pattern of transaction costs, the composition of the internalized “library service bundle” will change. Some services that the academic library has traditionally undertaken will be externalized to others. But it is important to emphasize that the shifting boundaries of the library are not the result of a one-way downsizing process. Even as some activities are shed, new ones will be taken on.

The size of the optimal library service bundle that emerges may be smaller, equal to, or greater than what prevailed in the past.

The future of the academic library will be shaped first and foremost by the needs of the faculty and students who rely on its resources and services. Aligning the composition of the internalized library service bundle with emerging research, teaching and learning practices is essential.

The transaction costs framework highlights fundamental questions regarding the future of the academic library. Which traditional library services can be externalized to other providers? Which services are best left internalized within the library? Given the services that are retained within the library, along with new services the library takes on, what can be said of the areas academic libraries will specialize in? Given the services that are externalized to other providers, what externalization models (market transactions, interinstitutional collaboration, etc.) will be most effective in ensuring that the services operate in cost-effective, reliable ways? A paper offering a more complete treatment of the transaction costs framework and its implications is forthcoming soon from OCLC Research.

*The authors thank their colleagues Constance Malpas and Jim Michalko for their helpful comments.

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