The Western Policy Exchange Project is designed to help states assess the implications of environmental changes on their own higher education system. In roundtables and policy workshops, six Western states--Idaho, Montana, New Mexico, South Dakota, Arizona, and Washington--looked for evidence of systemic change and proposed the following five hypotheses about how states change in purposeful ways: (1) changing the performance of state higher education systems requires coordinated leadership from elected and appointed officials, gubernatorial support, and a framework that involves public and private partnerships; (2) reliable and credible information about constituency needs is a prerequisite to establishing priorities that extend beyond problem-fixing; (3) development of consensus among key stakeholders about the nature of performance gaps and the most promising strategies for addressing them is critical; (4) to achieve purposeful and consistent change, incentives and disincentives in the state policy environment must support state priorities; and (5) to achieve purposeful and consistent improvement in performance of higher education systems, a statewide agency must be charged with collecting information about needs and performance and with using that information to build consensus about needed change. (Contains 23 references.) (CH)