International Business Environment:Accompanying Notes for Students

International Business Environment:Accompanying Notes for Students CASE 2: Internationalization of Higher Education Read the case study by Southern titled ‘Case Study: The Internationalization of Higher Education’ and consider the questions set out below.  This case concerns the University of Liverpool, your own institution, and looks at one aspect of the University’s strategy for internationalization. As you read the case think objectively about what it is that the University seeks to achieve in developing a portfolio of online programmes with a for-profit partner.  You might find this case intriguing because you are part of the strategy the University has for internationalization.  Make a note of some questions that you would like to explore in more detail and relate these to some of the theories from the module. Think about the following. •    How is the international higher education sector changing? •    What type of change is taking place at the national level? •    What challenges face an institution like the University of Liverpool given the change experienced internationally and nationally? •    Is Liverpool’s internationalization strategy going to provide more choice for students and/or a better student experience? •    Would it be better if the University focused more on their own on campus provision rather than partnering with for-profits or other institutions, like the one in China? •    From this case can you identify some pros and cons from globalization? Alan Southern February 2015 Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 1 Case Study: The Internationalization of Higher Education Alan Southern Introduction This case considers the internationalization of higher education. Higher education in the UK has undergone considerable change in the last three decades and one part of this is the way it has become much more international. However, this has been a slow burner and has taken a long time to come to fruition. Since 2000 there has been an increased emphasis on the international character of the higher education sector, with global league tables providing greater levels of information on leading higher education institutions (HEIs) and intense competition for the brightest home and international students. This has been further stimulated since 2010 by reforms introduced by the Coalition Government that encourage more private enterprise in the delivery of UK higher education. Some would argue that these changes represent neoliberal policies driven by globalization that seek to serve wealth creation over and above all other objectives, such as the provision of free universal education as a public good. At the same time there is evidence of technological disruption as more HEIs offer online distance learning and the emergence of Massive Open Online Courses known as MOOCs. We look at this in more detail in the following section and then turn specifically to how one institution, a well established UK university, sought to increase its global standing through the development of an online distance learning provision with a for-profit partner. The university in question, the University of Liverpool, is a member of the elite Russell Group and recognized as a top 100 global HEI.1 The global demand for higher education The demand for higher education is global and is increasing. HEIs in the UK appear to be well placed to recruit and to compete for what are regarded to be the brightest students around the world who are able to travel to get the education they regard as the best. In this sense degrees are increasingly 1 Ranked in 65th position according to the Times Higher Education 2015 Global Rankings. Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 2 seen as a positional good, something with a relative standing in the world so university rank is important. At the same time the provision of higher education has become increasingly commodified with evidence to suggest a growing divide in the recruitment of privately education and state-educated students to the Russell Group HEIs.2 UNESCO (the United Nations Educational, Scientific and Cultural Organization) recently estimated that in 2012 around 4 million students3 studied with an institution abroad, a figure that has doubled from 2 million in 2000. Traditionally it has been HEIs in developed countries such as the USA and the UK that have proven to be the most popular destination although HEIs in the developing countries are now proving attractive not least because they can act as a regional hub, involve less cost to the student and can often provide more suitable education centred on particular cultures. Table 1 Demand for international higher education, 2012 Most popular destination % Country of origin No. USA 18 China 695,000 UK 11 India 190,000 France 7 Republic of Korea 124,000 Australia 6 Germany 118,000 Germany 5 Saudi Arabia 62,500 Russian Federation 4 France 62,500 Japan 4 USA 58,500 Canada 3 Malaysia 56,000 China 2 Vietnam 54,000 Italy 2 Iran 52,000 Source: UNESCO, numbers rounded up to nearest 5004 As we can see in Table 1 the top five country destinations for international students entering higher education in 2012 accounted for nearly half of the total. Five destination countries hosted nearly one-half of total foreign students: the United States (hosting 18%), United Kingdom (11%), France (7%), Australia (6%), and Germany (5%). Yet this top five have seen their ability to attract international students drop from 55% of the total in 2000 to 2 See Top university ‘not a destination for many schools’. Available: http://www.bbc.co.uk/news/education-31005170 Accessed 27 January 2015. 3 This figure refers to students who have crossed a national border to study and does include distance-learning students. 4 See Global Flow of Tertiary Level Students, UNESCO Institute of Statistics. Available: http://www.uis.unesco.org/Education/Pages/international-student-flow-viz.aspx Accessed January 10th 2015. Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 3 47% in 2012. The UNESCO figures show growth in demand for higher education from all the major new economy regions such as the Middle East, Central Asia and sub-Saharan Africa. Almost 700,000 students travelled from China in 2012 to attend university abroad, almost 200,000 from India and over 100,000 each from the Republic of Korea and Germany. These figures indicate how accessibility to mass higher education has become a norm for many young people and that prestige, research-led HEIs in developed countries are committed to providing international education at a time when resources at home are becoming scarcer and competition is increasing. The supply of international students is part of a broader globalization trend and has provided a new opportunity for HEIs in the UK to internationalize. Overseas tuition of around £3 billion accounted for about 10% of the total revenue to UK HEIs in 2010/11.5 Meanwhile the UK Higher Education Statistics Agency (HESA) show of 2.3 million students studying at HEIs in 2012/13 in the UK, over 425,000 were from outside the UK. There were a further 600,000 students who were studying for a UK qualification while overseas. Of these 60% were registered with overseas partner organizations, just over 20% studied via distance learning and 3% studied at an overseas campus of a UK HEI.6 There are at least four options for international students: they can be recruited to UK HEIs to study on campus here in the UK; they can study on campus abroad when the host university is able to provide an education partnered with a UK HEI, or on an overseas campus that is owned or part owned by a UK HEI. Alternatively they may study by distance learning with a UK university. The sector is also coming to terms with new forms of technology impacting on provision. This is technological disruption driven through initiatives such as MOOCs provided by for-profit or not-for-profit collaborations such as Coursera and FutureLearn. Yet in the UK the present Coalition Government has given out a mixed message about higher education and international student recruitment. 5 McGettigan, A. (2013) The Great University Gamble Money, Markets and the Future of Higher Education, Pluto Press: London. 6 See Free Online Statistics - Students & qualifiers, HESA. Available: https://www.hesa.ac.uk/free-statistics Accessed January 10th 2015. Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 4 On the one hand the Department for Business, Innovation and Skills has argued that higher education is a key export sector and has encouraged HEIs to nurture the market for their education provision. David Willetts previous Minister for Universities and Science, and Secretary of State Vince Cable have sought to foster more private sector involvement in the delivery of higher education. The Coalition have actively supported the involvement of for-profit organizations such as Pearson and US-based Apollo Group in the sector while calling for a greater debate on the form UK HEIs should take to access investment and ensure they are viable and fit for competition. This has taken place at a time when they have withdrawn the role of the state as underwriter of those institutions who may experience financial difficulty and while considering new ways to expand degree awarding powers to for-profit institutions such as the University for Law. In contrast the Home Office has implemented changes to the visa system that has made it more difficult for many international students to travel to the UK for the purposes of attending a university. Greater powers have been given to the UK Borders Agency to enforce more stringent monitoring of international students while at university. Despite this many HEIs are looking at innovative ways in which they can augment recruitment from home and abroad especially in light of changes to the funding of home and EU students (specifically the introduction of £9,000 fees and student loans) and as austerity cuts have reduced their access to available public finance. At the same time there appears to be increased interest from the international private sector to invest into UK HEIs as the demand both global and national, for higher education continues. One aspect of contemporary policy associated with globalization is the effect upon public services such as education. Governments have attempted to restrict the levels of public finance available to public services not only in the UK but in other developed countries. Alongside this they have expected public sector institutions and local authorities to become more business-like and work in or develop markets for their goods and services. For some, it is the anti-competitive aspect of publically financed organizations that provide goods and services that mean they are not well suited to compete in international markets. By encouraging more laissez faire, more free-market Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 5 enterprise into these sectors it is argued, then this provides the way that globalization can have an impact on providing more efficient delivery of services that ultimately serves consumer choice.7 And of course the demand for higher education is concomitant with a growth in student debt in many developed countries, but especially in the USA where student debt is often referred to as the next subprime crisis. Andrew McGettigan sees the reforms aimed at HEIs as a means to privatize the sector by turning higher education into a commodity, enabling greater levels of consumer choice and transforming what was once regarded as the role of the public university with broader civic responsibilities. Delivering online higher education, everyday all over the world Providing higher education on a global scale has become one important aspect for the university that has a design on international prestige and reputation. One university that has pursued an international strategy and which launched online higher education provision at the end of 1999 was seen as a market leader in this field. The initiative has already met with some success in terms of student recruitment while future enrolment on online education is forecast to continue growing.8 The University of Liverpool entered into a partnership with a private sector provider of online programmes and we look at the details of this here. It was an initiative that was part of a broader strategy to raise its global profile through greater international links with peer institutions to explore research opportunities, through the recruitment of international students for on campus learning and by partnering a Chinese university to create a joint venture in China, Xi’an Jiaotong- Liverpool University in Suzhou. By the end of 2013 the University had 22 online programmes, wholly owned by the University and delivered in partnership with the USA-based Laureate Education Inc.9 At the University around thirty academics and a further cohort of nine professional support staff were employed specifically to work on their online programme portfolio. 7 Deem, R. (2001) Globalisation, New Managerialism, Academic Capitalism and Entrepreneurialism in Universities: Is the local dimension still important? Comparative Education Volume, 37(1) pp.7–20. 8 Allen, I.E. and Seaman, J. (2013) Changing Course Ten Years of Tracking Online Education in the United States, Babson Survey Research Group, Pearson Sloan-C. 9 Laureate claim to be the largest higher education provider in the world. The for-profit have an estimated 850,000 students spread over 29 countries. Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 6 The story of the online programmes at Liverpool begins back in 1998 when the University had discussions with a small technology enterprise founded in Israel called Kidum about distance learning teacher training. Kidum put forward two proposals to the University for consideration: develop franchised undergraduate programmes that could be delivered on campus in a number of local HEIs outside the UK or alternatively, a wholly online distance learning postgraduate programme. It was the second proposition that formed the basis for further discussion, and then agreement was reached about how the operation would be managed and development began. The University believed that such an initiative would support their strategy for increased postgraduate numbers, more international students and a greater global profile while not adding to the stress on resources that physical attendance can bring on buildings and staff time. In Liverpool an e-Learning Unit was formed to manage the operation “based at the University and staffed by University employees, responsible for quality assurance...” with an appointed Director who leads the initiative on behalf of the University. The Unit becomes accountable for ensuring University procedures are implemented and standards of academic management are governed accordingly. Meanwhile Kidum created a new company called KIT located in the Netherlands. This was a separate enterprise with a sole objective of managing the relationship with the University and putting the plan into operation, thereby holding day-to-day responsibility for much of the management of the online programmes. Teaching materials are specified by University academics who work with KIT developers to ensure they are of the correct quality. Classes are run on an IT platform in a virtual learning environment with an average class size of around 12 students. Lecturers run seminars across a period of eight weeks are employed as part-time staff by KIT and approved as Honorary University staff. This means that the financial risk is shifted from the University to KIT and allows the University to manage its own risk to reputation while expanding its postgraduate student numbers on an international scale. In the background at this time are an education provider from Baltimore called Sylvan who provide some limited hands on Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 7 support for KIT. So as a precursor to the launch of the first online programme is the partnership between the University and KIT, and between KIT and Sylvan, the latter a relationship that becomes much more important. In the years between 2000 and 2004 the online programmes become established in the University. The first programme in an MSc in IT located in the Department of Computer Science and in 2001 the second, an online Master of Business Administration (MBA) programme is launched prior to the University opening a new Management School in 2002. KIT move to new offices in Amsterdam and in the University staff are seconded from Computer Science and the Management School to the e-Learning Unit. A new set of Quality Assurance procedures is put in place dealing with academic affairs, student progression and academic integrity, some of which predate the policies on campus as the University is aware of the potential for queries raised against the method of teaching and delivery of this type of postgraduate learning. By 2004 over 1,500 students from across the world are registered on the two online Masters programmes. The online MBA is hosted in the new Management School where a new on campus MBA has also been launched. Staff in the University recognize that there is now a discrepancy between the curriculum of the two programmes and the Director of the Management School calls for this to be addressed to aid moves to achieve external accreditation for the School. Meanwhile a second IT programme is developed and launched. The University is satisfied at this stage with how the operation is being run despite it operating at a net cost. The period from 2004 up to the end of 2006 sees a marked shift in the delivery of the University online programmes. A major development is the acquisition of KIT by Sylvan. As a small enterprise operating on a global scale KIT reach a limit to what they can manage; they have already grown their operation and expanded their offices in the Ajax Arena in Amsterdam and now realize that unless they put in place a plan for expansion they will face difficulties in achieving further growth. The University, informed of the discussions taking place between Sylvan and KIT recognize that their agreements with KIT will need to be reviewed as the takeover occurs. Sylvan Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 8 restructure and part of their operation is sold off and they turn their focus towards higher education realizing the potential for growth from a growing global market. Sylvan rebrand themselves under their new name ‘Laureate’ and identify their target markets as national in the USA, and globally with a plan to acquire more for-profit owned HEI campuses. Representatives from the University travel to Baltimore and approve the relationship with Laureate, sign a new legal arrangement and develop joint plans relating to growth and revenue. Agreement is reached in principle to launch a new online Masters in Public Health (MPH). From working closely with a small for-profit enterprise that had its headquarters in Amsterdam to develop its online operation the University now found itself working with a major provider of education, a large for-profit with headquarters in Baltimore who had much more aggressive plans for global growth than KIT could manage or envisage. In the five years from 2007 into 2011 there is a marked period of growth for the University and its partnership now with Laureate. In the early years a number of new programmes are launched all at postgraduate Masters level in health, management, finance and law. Towards the end of this period plans are outlined to develop two professional doctorate programmes, a Doctorate of Business Administration (DBA) and a Doctorate in Education (EdD). The University expands the number of academics and support staff working on the programmes although maintains its centralized management. Recognizing the continued questions arising about providing online education and with a for-profit partner, the University further details its management operation and reinforces its Quality Assurance systems. A programme accreditation strategy leads to third party accreditation for the online MBA by the European Foundation for Management Development (EFMD) and for the MSc Operations and Supply Change Management by the Chartered Institute of Purchasing and Supply (CIPS). Other programmes are submitted for the same type of third party accreditation, such as the IT programmes through the British Computer Society accreditation process. The first online doctorate, the DBA is launched in September 2010 followed 12 months later by the second, the EdD. In 2011 a new Masters programme in psychology begins. New structures are put in place to deal with the expanding numbers of part-time Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 9 lecturers who teach on the programmes to ensure they are committed to continuous improvement, while new systems to manage research ethical review and approval for dissertation and doctorate students are implemented. Figure 1 Number of graduates from online programmes, 2003-2011 By the end of 2011 there were around 9,000 students registered and in class on the University of Liverpool online programmes. The average age of the student was 38 years with the youngest student aged 21 and oldest aged 81. Around 20% of students were under the age of 30 years and 46% aged between 31 and 40 years. Only 3% of students had less than five years work experience. While 38% of students were resident in Africa, 33% were African by nationality. From the Middle East 15% were resident and 9% national; 18% resident in the American continent (North and South) and 18% nationals, 20% European residents with 30% nationals and 9% resident in Asia with 10% nationals. Less than 10% of all students were resident in the UK. As Figure 1 shows, nearly a thousand students graduated in 2011 many of them visiting Liverpool for the first time. While Laureate, responsible for employing the lecturing staff, by this time employed 400 online academics to teach on 0 250 500 750 1000 2003 2004 2005 2006 2007 2008 2009 2010 2011 964 785 741 657 495 608 606 66 90 Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 10 the programmes, from 50 countries with over 50% of these based either in UK or USA. Final points At a time of change in the higher education sector in the UK the University of Liverpool chose an ambitious internationalization strategy. This was a risk for the University because of the newness of the teaching method and the deal with a for-profit partner. The focus on ensuring high levels of quality in the provision of learning and teaching not only ensured that the University met the regulatory conditions required by the Quality Assurance Agency in the UK, but meant that its reputation in a global market place had a firm base from which to promote the programmes. The programmes were targeted at a segment of the international marketplace that previously only received marginal attention; those in work with experience and often with family commitments that reduced their opportunity to travel to access UK higher education. The delivery of Liverpool education by the for-profit partner to places such as Africa and Asia has widened the global appeal of the University. The formation of the e- Learning Unit meant that in the early years standardized processes were implemented across the programmes to embed the work into the daily activities of the University and to make sure that whether the University’s education was delivered on campus or online, that there was credibility in the claim that standards were equal. The programmes were innovative at the time, driven by a strong learning method and provided a stable revenue stream from which more activities could be developed. However, the global market has changed even in the short period of Liverpool’s relationship with Laureate. On the learning and teaching front one potential global change has come from the emergence of MOOCs. Not only does this offer an alternative form of learning, one that appears revolutionary, many of the HEIs involved are prestigious institutions including the likes of Princeton, Johns Hopkins, and the University of Manchester. While it is still to early to tell, MOOCs may also represent technological disruption that comes to change management cultures across many universities in the sector, particularly at the interface Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 11 between quality standards and consumer choice. Reforms set out by the UK Coalition Government has also changed the environment for the strategy pursued by the University of Liverpool. By encouraging more for-profits into the sector it would seem Liverpool is at the leading edge here too, with its innovative partnership with such a large organization as Laureate. In this regard however, the relationship has not translated into greater levels of debate about consumer choice and student experience on campus. Although the University does have an agreement with another for-profit called Kaplan, through the Liverpool International College to provide access for international students who are able to move on campus and register on either an undergraduate or a postgraduate programme. The University has moved quickly to achieve competitive advantage in the international online market and is now also a partner with the MOOC FutureLearn in an initiative completely separate to their relationship with Laureate. Whether they can maintain such an advantage remains to be seen and how the larger political debate about the role of the public university comes to influence the sector is also unclear. At the very least it will challenge the corporate form of HEIs who seek to develop their strategy for internationalization. END Work licensed under a Creative Commons Attribution Non Commercial No Derivatives License 12 Further Reading If you are interested in following up this case I can suggest some further reading as follows. Brown, R. (2013) Everything for Sale? The Marketisation of UK Higher Education, Routledge: London. Deem, R. (2001) Globalisation, new managerialism, academic capitalism and entrepreneurialism in universities: is the local dimension still important? Comparative Education Volume, 37(1) pp.7–20. Grist, M. (2012) Future universities towards a genuinely sustainable system, Demos in collaboration with the Pearson Centre for Policy and Learning: London. Healey, N.M. (2008) Is higher education in really ‘internationalising’? Higher Education, 55(3), pp.333-355. McGettigan, A. (2013) The Great University Gamble Money, Markets and the Future of Higher Education, Pluto Press: London. To reference this paper cite as follows: Southern, A. (2015) Case Study: The Internationalization of Higher Education, University of Liverpool. This work is available under a Creative Commons Attribution. For details click here: http://creativecommons.org/licenses/by-nc-nd/3.0/deed.en_US For any further enquiries about this case please contact Alan Southern on the following email address: alan.southern@liverpool.ac.uk PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET AN AMAZING DISCOUNT :)