Brendan Boyle
University of Newcastle
Brendan Boyle is an Associate Professor in Newcastle Business School, University of Newcastle, Australia. Brendan’s primary research interests include international HRM and knowledge sharing in organizations.
This paper focuses on global education from the perspective of the business of education delivery in a multi-million-dollar international market in which the number of fee-paying tertiary students enrolled in universities outside their own country currently stands well in excess of 3 million students (OECD, 2010). Notwithstanding the extensive research on globalisation of business there is still a lacuna of comparable research on the globalisation of universities (Doh, 2010). While recognising a recent trend to address this, especially in scholarly literature on management education, there is still a paucity of papers that examine this industry from a world business perspective. This paper makes a contribution to filling this gap and aims to encourage strategists in internationalising universities to reflect on the potential strategic importance of global markets for education, how the competitive environment is evolving and the sustainability of incumbents’ competitive positions.
Taking a resource-based perspective on competitive strategy (Barney, 1991) in global education, we explain that while geographic boundaries are certainly less effective forms of differentiation than what they were, the hard-to-imitate resources that combine to create the service capabilities of many of the leading educational institutions in the west, can provide a sustainable grounds for competitive differentiation. Although advanced models of university internationalisation (i.e. branch campuses) raise specific strategic challenges (i.e. international strategy implications), the globalisation of educational services, in any guise, should prompt strategic decision makers to ask some fundamental strategic questions such as, “What are the ‘competitive’ implications for enrolments and how should the institution respond (e.g. from an economic, pedagogical or operational perspective)? Peng (2006) suggests that one of the fundamental questions in strategy can be posed simply – How should ‘firms’ behave? Following a review of the sustainability of incumbent advantage, we ask: How should incumbent market leaders in global education behave in this evolving competitive market?
Based on our conceptual analyses and application of extant resource-based theory, we conclude that the valuable and hard-to-imitate reputational and knowledge resources that western universities possess will not easily de-value in the face of new competition and open access to information, something that incumbent universities can use as a source of sustainable advantage, at least in the medium-term. We conclude that neither this differentiation, nor the effort to leverage it in international markets for education, provide a strategic rationale for universities to adapt their core models of service delivery, the opposite (standardisation and integration) is in fact justified. Taking an international business focus we build on the growing body of literature highlighting the changing industry environment of global education (Friga, Bettis & Sullivan, 2003; Doh, 2010), and consider the sustainability of the competitive position currently enjoyed by providers from leading international export countries such as the US, UK and Australia (OECD, 2010). We explain that strategists at internationalised universities must now take stock of the sustainability of their competitive position not only relative to each other, but also relative to providers from emerging Asian leaders such as China. The implications for incumbents are discussed
