Transnational education delivery in a changing global landscape Scott Crighton 26 July 2012

1. Transnational education delivery in a changing global landscape Scott Crighton 26 July 2012

2. Outline 1. Key factors influencing TNE • Regulatory environment • Competitive environment • Risks and reputation 2. What has the impact been on TNE provision? • Growth or consolidation? • Managing responsibilities • Business case development 3. Next steps • what should providers do?

3. Transnational Educaiton (TNE) models • For the purposes of this discussion, two types of activities will be considered as TNE • Offshore partnership programs • International branch campus activities

4. Definitions • Partnership programs: • Home institution accredited award programs offered through a ‘local’ partner institution. No “bricks and mortar” • International branch campus: • Home institution accredited award or awards offered in another country, with the home institution having established a physical presence in the offshore location. (“bricks and mortar”)

5. Factors impacting on Australian transnational education A range of factors are impacting on TNE. A few examples to be considered here are: • Growth of regulatory agencies and changing Government policies • Increasing levels of competition in traditional TNE markets • Growing awareness of risk factors

6. Regulatory environment • Growth of regulatory agencies and frameworks • in Australia (e.g. AUQA/TEQSA, ASQA, AQF) • in TNE markets (CPE; HKCAAVQ; MQA, etc)

7. An increasingly competitive environment for TNE • Government initiatives in key markets • Policy shifts in UK Higher Education – leading to outward push • Competition from cheaper models that are difficult or impossible for Australian institutions (e.g. validation model) • The offshore campus phenomenon • The persistently high Australian dollar

8. TNE Risk factors There are many risks with running TNE activities, including: • Financial • poor financial viability • payment defaults • Changes to market demand and consequent loss of income • collapse of programs/partnerships and meeting teach-out requirements. • Legal • contract non-compliance • in-country regulatory requirements.

9. Risks • Quality • Ensuring that what is delivered offshore meets the same quality standards as what is delivered onshore • Balancing academic and financial considerations • “Replicating” the student experience • Language • Meeting student support services offshore These are particular challenges in partnership relationships where another institution has key academic and administrative responsibilities.

10. Risks • Reputation • Any offshore TNE provision represents an extension of the home campus. Any reputational damage offshore will therefore have reputational impacts on the whole institution and the sector. • Reputational impact can be significant if • partnerships or campus locations collapse • obligations to students are not met • Program quality requirements are not met • institution is misrepresented • Partner is brought into disrepute • Other in-country associations brought into disrepute.

11. Risks • There are recent examples of Higher Education institutions having their reputations severely damaged due to their offshore activities: • University of Wales • London School of Economics

12. Changes in TNE? • Have changes in the external environment, as well as growing institutional awareness of risks, led to changes in Australian TNE?

13. Changes in TNE? • A general trend is apparent among Australian TNE providers toward consolidation of partnerships and programs, but with student numbers nevertheless either growing or levelling out . Singapore & Malaysia examples: • declines in the number of Australian institutions providing HE TNE over past decade • numbers of enrolled students in Singapore increased by 57.7% from 2002 to 2008 • Numbers of students have increased 7.5% p.a. in Malaysia since 2004/5 (See Banks, et al., June 2010; 54)

14. Changes in TNE? (International Branch campuses) The trend among Australian providers toward fewer but larger TNE activities is also marked in international branch campus (IBC) activity. • Number of Australian IBCs has declined from 14 to 12 from 2009 to 2011 • Australian IBCs account for only 6% of world total, but 52% of IBC enrolment numbers for the top 15 IBCs (25,600 of 49,180), or 21% of the estimated world total (25,600 of 120,000) Source: OBHE IBC Report 2012

15. Australia vs the rest of the world:are the trends the same? For other TNE provider countries there appears to be differing trends to Australia • For example, the number of IBC’s are showing significant growth internationally, e.g. number of UK IBC’s has nearly doubled from 2009 to 2011 (from 13 to 25) • A large number of IBC’s have very small student numbers: median student numbers in 2011 was 235 per campus • There are 78 US branch campuses, but understood to have relatively small numbers of students in most cases. Source: OBHE IBC Report 2012

16. Trends related to consolidation of Australian TNE activities • Consolidation trends have led to the development of more complex institutional relationships • TNE activities span a greater number of academic and functional areas within both home and partner institutions. • Within this context, coordination and careful management of TNE activity has become far more critical.

17. TNE management and QA centralisation? • Survey of Australian institutions undertaking TNE have shown trends to management centralisation in: • New business development • Contract management and monitoring renewals and exits • Enrolments and graduations • Financial tracking • Quality assurance and audits • High level communications • Marketing approvals Source: Crighton and Nery 2010

18. Stakeholder management • Understanding needs and requirements • Clearly defining internal roles and responsibilities – helps ensure a more coordinated approach with partners • Coordinating communication • Clearly defining, reviewing and monitoring responsibilities of each party • Clear detailed legal agreements • Guides and manuals • Regular formal and informal communication • Monitoring tools and databases • single activity calendar, etc.

19. Business Case Development Increasing understanding of importance of high levels of rigour in the assessment of new TNE opportunities: • Strategic assessment • Detailed market analysis and assessment – inc. competitor analysis, demand assessment, impact of government policies, etc. • Business model & associated roles and responsibilities • Partner due diligence (legal, financial, facilities assessment, capacity assessment, ranking, relevant experience, etc.) • Financial analysis – detailed costing • Risk assessment • Management structure

20. Management structures TNE management – ensuring success • Important that central support areas are developed with • contracting experience • financial management and refined costing frameworks • monitoring frameworks • refined partner management models • quality assurance expertise • Roles and responsibilities – properly defined and managed

21. Ongoing challenges • Meeting competitive challenges while maintaining quality and keeping risks under control • Finding & adopting innovative models • Ensuring rigorous systems for assessment and approval of business opportunities, balanced against importance of being nimble • Finding a good balance between centralised and decentralised management & obtaining stakeholder buy-in.

22. Preparing for the future: what should providers do? • Prepare for changes in existing markets - explore new markets & delivery models • Take all possible measures to ensure reputation is not damaged • Continue to strengthen business planning, management, monitoring and quality systems, and ensure appropriate levels of central coordination of these activities • Ensure clear exit and transition plans

23. Questions?