Month: April 2018

GETTING TO GRIPS WITH PATHWAYS – A THORNY SUBJECT?

After looking at the broader picture on winners and losers in HE recruitment I’ve focused on a small number of high profile university partnerships to give some texture about those with pathway providers. Diving into the detail published by universities gives some insight as to whether pathway provision is delivering a stable stream and enhancing direct recruitment through global brand-building. Comparisons against the national picture indicate whether they are doing better than the sector overall.

Detailed breakdown of pathway volumes and progression rates are usually deemed commercially confidential and are rarely matters of public record. As a proxy I have looked at overall international student enrolment for the institutions involved as one would expect a thriving pathway of any size to provide a solid underpinning for broader recruitment efforts. Where possible I have supplemented this with Quality Assurance Agency for Higher Education (QAA) or University Annual Report data (available through the BUFDG site.

The examples I have chosen show sharply different outcomes at the university level.  The underlying detail from supplementary sources suggests that the pathway is a contributing factor to those outcomes.  In a broader context some institutions have done better than average and some not as well.

While the detail is UK related there is little reason to believe that the same isn’t true of the US and I’m doing some more work on that hypothesis for a later blog.

Three Big Players and Partners
Institutions are never wholly comparable but the universities of Newcastle, Liverpool and Sheffield are all large, metropolitan, Russell Group universities with substantial global ambitions. In the Times League Table 2018 Newcastle is 26th, Liverpool is 42nd and Sheffield is 21st. Newcastle and Liverpool have partnered with INTO and Kaplan respectively since 2007. Liverpool recently extended for another 15 years while Newcastle opened a new London campus with INTO in 2015 and are also in for the long haul. Sheffield was with Kaplan but switched to Study Group from September 2015.

Information published in University Annual Reports on overall international student enrolments in the five years from 2012/13 to 2016/17 suggests that Liverpool have, to date, weathered the headwinds facing the UK better than Sheffield or Newcastle.   Source: University Annual Reports and Financial Statements 2012/13 to 2016/17

The university financial statements suggests that any changes to fees have not been sufficient to make up enrolment shortfalls. The fee income reflects the down-turn in student numbers for Sheffield and Liverpool in the 2016/17 year but also suggests weakness for Newcastle over the past two years.
Source: University Annual Reports and Financial Statements 2012/13 to 2016/17

To provide a comparative performance for the universities I have used HESA data for all international enrolments (all levels, full-time and part-time) in the 129 universities in the 2018 Times League Table. This is a measure which should include students enrolling across the whole year and should account for pathway progression from all intakes.  It usually differs from the University Annual Report enrolment figures which are generally taken from a count in December of the academic year.  I review the complexity of the broader HESA data in an earlier blog.

All the universities outperformed the average in the first two years under review. Liverpool and Sheffield achieved this between 2014/15 and 2015/16. Liverpool continued to outperform the sector from 2015/16 to 2016/17.
Source: HESA

Understanding The Pathway Performance
There is some insight into the changes at the pathways for Liverpool and Sheffield through the Quality Assurance Agency reports. For INTO Newcastle there has been no similar educational oversight although my understanding is that the changing visa situation will mean that ISI will provide oversight in the future which may lift the veil. My observations below are drawn from published material including university annual reports.

Newcastle and INTO
The University notes in its 2016/17 Annual Report that the enrolments at INTO Newcastle ‘had a disappointing year with a 7% reduction in student volumes’ which was comparable to the University’s direct recruitment decline. As a 50/50 joint venture partner the University also reports on its share of joint venture income and surplus/deficit. For completeness I have shown both the Newcastle-based and London-based operations but note that the latter has substantial undergraduate and postgraduate intakes in addition to pathways.
Source: University of Newcastle Annual Reports 2012/13 to 2016/17

The London joint venture is still in start up mode and student numbers are reported as having grown from 24 in year one to 184 full time and 20 part-time students in year two. The income and operating surplus/deficit are reported as:
Source: University of Newcastle Annual Reports 2014/15 to 2016/17

Liverpool and Kaplan
What is most striking about reviewing performance through the lens of the University Annual Reports is that it can reflect a level of engagement and shared commitment – or in some cases not. On page three of the 2016/17 Liverpool University report the Vice Chancellor reflects on the long-standing relationship, the renewal agreement for the next 15 years and the investment in new facilities for the pathway. The report notes that the partnerships with both Kaplan and Laureate International ‘are vital to the University’s international outlook and global ambitions.’

The Annual Report notes that Kaplan’s International College opened in 2007 with 146 students and has seen 6,500 students study at the College, with 20% of the institution’s international recruitment achieved via its pathways. Future investment includes construction of a new, 47,000 square foot, 13-storey college building due to open in 2019.

A key determinant of a successful pathway relationship is the extent to which the University partner embraces the strengths of the private provider and clears roadblocks to innovation and recruitment. Both parties are undermined if the University does not engage productively at both a senior and operational level. The 2016 QAA Report for Kaplan International College at Liverpool notes ‘The close working relationship with the partner university, which enables highly effective and regular processes for developing, monitoring and reviewing of programmes’.

Sheffield and Study Group
Sheffield International College was first established by Kaplan with the University in 2006. In 2010/11 it had over 1100 students and this number had ‘grown’ by 2013 despite no new programmes being introduced (QAA Reports 2012 and 2013). Over a period from March 2014 to September 2015 there was a transition to Study Group.

The November 2016 QAA Review indicates that 933 students were in the Centre and the next report in October 2017 says that ‘student numbers fell by around 12 per cent between 2015-16 and 2016-17’. On the upside it was noted that 7 per cent more students entering programmes at USIC being eligible for progression to the University. The timing of the QAA review makes it difficult to draw firm conclusions about full-year recruitment.

It’s still early days in the partnership and the whisper in the sector is that the University protected its commercial interests in the event of any performance issues – perhaps a sign that universities are becoming more commercially minded. The PIE noted in August 2017 that ‘Providence Equity Partners, which owns higher education provider Study Group, is reportedly preparing to sell the company for £700m’  so there is a lot at stake as the company manages the expectations of its large stable of partners. Interesting times as the UK itself comes under relentless market competition from Canada , Europe, Australia and the emerging destinations in Asia.

Closing Thoughts
Nobody who is looking from outside can full understand the dynamics of a relationship between University and pathway provider. Anyone who has been at the sharp end knows that personalities, department politics and academic apathy are all facts of life as is, from time to time, a revolving door of senior decision makers. An initial meeting of minds at the highest level is usually not enough for sustained success so the working relationships need to become rapidly embedded.

What is for sure is that the chances of maximising performance are vastly enhanced by realistic expectations, responsiveness to market and action on shared commitments. Universities need to see the pathway as being fundamental to their success and treat the provider as an equal partner with important skills. Providers need to be honest about what they can deliver and manage how their portfolio is balanced to meet targets and business plans.

And perhaps, given the age of the pathway model and the way the market is changing it is time to consider whether further innovation is needed. Over the years I have heard several major pathway players define their approach as ‘disruptive’ or ‘transformational’ but it is difficult to see how pathways are any different now to when they were introduced.

Notes and Corrections

Comments are always welcome and I think it is a good thing to note any corrections or amendments to the text.

30 April 2018 10.05amPDT – amendment to correct ‘Newcastle and Liverpool have partnered with Kaplan and INTO respectively..’. Correction to clarify that INTO partner with Newcastle and Kaplan partner with Liverpool.

PATHWAY, DEAD END OR TIME FOR A U-TURN?

August 2018 will be the fifth anniversary of Shorelight’s first partner, Bath Spa University in the UK, being announced with suggestions that the university would ‘see its overseas intake swell to around 2,000 students over the next four years.’. The four years would run from 2015/16 to 2018/19.

It seemed a good moment to look at the pathway market and what happens when relationships don’t  work out.  This is partly because we may be entering a period where the pathway sector has matured and circumstances make it ripe for realignment.  The stakes are high on all sides and the factors are particularly relevant to the UK and US where growth in pathways has been rapid and international student recruitment has been under substantial pressure.

As finances tighten university management is under more scrutiny and is likely to demand more in terms of targets and delivery from partners.  The consequences of a failing pathway are becoming increasingly difficult to hide as direct recruitment gets harder.  Providers have their own problems with unprecedented global pressures and ubiquitous competition.  Some may be reaching a point where optimising their portfolio is more important than simply adding or maintaining capacity.

In the UK a number of institutions have been following the University of Sheffield to see how the switch from one major private provider to another might work.  Loyalties are under pressure as university leaders who signed the deal move on and some pathway providers look to change hands after the glut of private equity investment from 2010 to 2014.  Pressure to perform has never been greater.

So, when a pathway becomes a dead-end there is every incentive for one or other party to make a U-turn.  Or, as Warren Buffett is quoted as saying, “Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be a more productive than energy devoted to patching leaks.”  And it doesn’t really matter if it’s a long-term contract (where remedies for under-performance are usually written in) or time for a tender after five years.

IT HASN’T ALWAYS ENDED WELL IN THE PAST
There is, of course, precedent and although closures can be hard to trace I have listed below those that I have uncovered in my research.  New partnerships are usually heralded with a fanfare and people smiling as they shake hands on a deal done. Unsurprisingly, a veil is drawn over partnerships that end and those that are public are usually dressed in anodyne media responses.

For both universities and providers that is unfortunate.  Considering and addressing failure is a good way of learning and often more informative than the bright, shiny case studies which are so popular as sales tools.  In my time with two leading universities with private providers and as COO and CEO with two providers I saw many factors that can make or break a partnership.  These are worth sharing.

I make no comment on the reasons for the ending of the relationships noted (but have referenced reports where available). Neither do I claim that this list is exhaustive and I would be interested in any other examples.  For organisations contemplating partnerships an open and honest discussion with those who have tried and moved on is probably worth as much as hours of expensive contract development.

Study Group
i) Stirling University (Opened 2007- Closed 2013) Source: QAA

INTO
i) University of East Anglia London (2010-2014) Source: THE)                                                                         ii) University of Stirling London (Opened 2014 – Closed 2015?)                                                                                     iii) St George’s University (Opened 2012 – closed 2017 Source: St George’s University Annual Report

Oxford International
i) Canterbury Christchurch (Opened 2015 – closed 2017?)

Kaplan
i) University of Utah (Opened 2010 – Closed?) ii)University of Sheffield (Opened 2006 – Closed 2015)

Navitas
i) Western Kentucky University (Opened 2010 – Closed 2016)
ii) Edinburgh Napier (Opened 2011 – due to close 2018)

PRIVATE PATHWAYS MAY NOT BE ACCESSIBLE OR GUARANTEE SUCCESS
UK universities with the greatest decline in overall international enrolments in the past five years often have no pathway partner or are relatively late to the party. Several of the non-aligned universities here have been actively seeking providers but there is, inevitably, caution from providers about taking on institutions that do not have underlying strength.

It remains to be seen whether some of the new partnerships can materially alter the trajectory of underperforming universities.  Sector sources suggest that Oxford International and the University of Bedfordshire are parting company and the provider is not currently listing this university on its website.

Table 1 – UK Universities With Greatest Decline In International Enrolments 2012/13 to 2016/17

Source: HESA (enrolments), QAA and University/Company websites

And that brings me full circle to Bath Spa and Shorelight. HESA data (supported by the University’s Annual Report narrative) showed strong growth in international recruitment from 2012/13 to 2014/15. In the first full year of the partnership with Shorelight (2015/16) there was a weakening of growth which was followed by declining international enrolments in 2016/17.  There is some way to go for the university to reach the anticipated 2,000 by 2018/19.

Table 2 – Bath Spa University International Enrolments 2012-13 to 2016/17

Source: HESA

Perhaps more troubling is that in December 2017 the THE reported that ‘figures available on (sic) Companies House show that Bath Spa Global – an international pathway college venture set up in 2014 in partnership with US firm Shorelight Education – has lost about £1.4 million in the three years to July 2016, while its parent company Bath Spa U has lost about £736,000 over the same period.’. The 2016/17 Financial Statement from Bath Spa showed international student income and numbers declining year on year and noted that the joint venture partnership, Bath Spa Global, ‘remains fragile’.  At the time of writing I can find no mention of Bath Spa University on Shorelight’s web-site and no current reference to Shorelight on the University’s site.

Winning And Losing In Global Recruitment

A lot is written about ‘winners’ and ‘losers’ in the race for international students. Putting some edges on that brings some surprises in terms of scale and the institutions in each camp. Between 2012/13 and 2016/17 the biggest eleven gainers in the UK ‘gained’ nearly 20,000 more international students while the eleven largest losers ‘lost’ approaching 19,000 students.

The outcomes show that mid-ranking, non-metropolitan, and less well-known universities can compete at the top table.  It is also clear that being part of an exclusive clique of universities is not, on its own, enough.  Good case studies abound for anyone wanting to grow enrolments in challenging times.

These conclusions are drawn from the Higher Education Statistics Agency (HESA) data showing international (non-UK or Other European) students enrolled by institution between 2012/13 and 2016/17. It’s a public record, self-reported by universities, and is widely used so it is one way of keeping score. I reflect on some of the complexities in notes at the end of the blog (and look forward to any corrections or challenges). When I worked for universities the time honoured response from planning offices to questions about student numbers was ‘how many would you like us to have’!

To give context HESA reported non-European enrolments between 2012/13 and 2016/17 growing from 299,490 students to 307,540 with a high point of 312,010 in 2014/15 (https://www.hesa.ac.uk/data-and-analysis/sfr247/figure-8).  This is a total for all levels, years and modes of study.

WINNERS ARE NOT ALWAYS AS EXPECTED
Unsurprisingly large, well-established, metropolitan universities with strong rankings are well represented in the top eleven gainers.  I was told that when  one Russell Group university began to consider its brand management its proud response to questions about key selling points was ‘we’re big and we’re old’. For some that may still be enough but they are far from the only winners.

At number eleven, De Montfort University (DMU) has shown that clear strategic direction, strong engagement at senior levels and powerful execution can make a substantial difference. As CEO of their pathway partner, Oxford International Education Group, I saw at close hand the strong commitment to internationalisation and collaborative working. Their overall success reflects the drive of James Gardner, Pro Vice-Chancellor for International and Ben Browne, COO, under the leadership of Vice Chancellor, Prof Dominic Shellard.

Their partnership with Oxford International, established in 2013, has also played a part with integrated degrees and 94% progression rates in 2015-16 (QAA Educational Oversight, March 2017) boosting enrolments. A good lesson for any university with a private provider as partner is to be found in the strength of working relationships between Oxford International’s founder, David Brown, and former-Director of Global Sales, David Anthonisz, and senior university figures, including Gerard Moran, Director of Academic Partnerships.

Table 1 – Top Eleven Changes in International Enrolment by Headcount 2012-13 to 2016-17
Source: HESA tables 2012/13 to 2016/17 (see notes at end of blog)

BUT ABSOLUTE VOLUME IS NOT THE ONLY GAME IN TOWN
One would expect some of the biggest players to rack up the largest volume growth. But significant gains can also be made by universities with more modest starting points. The top five in terms of percentage growth over the period (with at least 2,000 international students in 2016/17) is a different way of considering potential. Table 2 has representation from England, Wales, Scotland and Northern Ireland and demonstrate that major English cities are not the be all and end all.

Table 2: Top Five By Percentage Growth of International Students – 2012/13 to 2016/17 (with total student volume over 2,000 in 2016/17)

Source: HESA tables 2012/13 to 2016/17 (see notes at end of blog)

The performance of Queen’s under the guidance of James O’Kane, Registrar and COO, and Isabel Jennings, Director of Marketing, Recruitment, Communications and Internationalisation, has been outstanding. I worked alongside them to develop an international enrolment strategy from 2011 to early 2013 and again as COO at pathway partner, INTO, in 2015. There were significant challenges to overcome in terms of location, reputation, data, programs and processes but these results show the potential for a focused, well-executed, long-term strategy to pay dividends.

This chart does not include some smaller institutions with growth stories. Falmouth University grew from 125 to 280 and the University of the West of Scotland by a startling 164.5% (405 to 1055) over the period. Cumbria, Newman, York St John, University of the Arts London, Birmingham City, London South Bank, Westminster, and Brighton – all ranked below 100 in the 2018 Times league table – have also added students over the five years. Each will have a different strategy but under tough competitive conditions every additional student reflects thought, effort and delivery.

FOR EVERY RAY OF SUNSHINE A DROP OF RAIN MUST FALL
The universities that have seen their enrolments decline by the greatest percentage lost 18,875 students. Some have had specific difficulties, such as visa challenges. Most are in the lower half of most league tables.

It is possible that the closing gap between the fee value of an international student and a home/EU student may have encouraged some universities to rebalance their community. But it is difficult to believe that many of these institutions set out to lose international enrolments to this level.

Table 3 – Eleven Largest Negative Changes In International Enrolment by Headcount 2012-13 to 2016-17

Source: HESA tables 2012/13 to 2016/17 (see notes at end of blog)

The most surprising is Nottingham University which has a well-deserved recognition for its international reputation and reach. Its Annual Reports for the period suggest a much smaller decline in international students from 6887 in 2012/13 to 6809 in 2015/16. The purpose of this blog is to reflect the data as reported through HESA but changes in reporting may have contributed to the overall scale of the decline.

Nottingham’s 2017 annual report also notes, ‘The University plans for a significant expansion of international recruitment, underpinned by the international foundation year, have been re-assessed and deliverable yet challenging targets have been agreed.’ Kaplan have been selected to support them.

In percentage terms Chart 4 notes those in the top 30 in the Times League Table 2018 that appear to have gone backwards over the period.

Table 4 – Universities in Times Top 30 Showing Volume Declines from 2012/13 to 2016/17

Source: HESA tables 2012/13 to 2016/17 (see notes at end of blog)

What this can mean for a university is illustrated by Table 5 showing income from international student fees over the period for three of these universities.  While East Anglia’s and Essex’s declining income in 2016/17 is not calamitous it results from a declining student body and stagnation/low growth in fee levels. The University of Dundee has, from a lower base, been able to implement significant tuition fee increases.

Table 5 – International Student Fee Income (£000s) 2012/13 to 2016/17Source: University Financial Statements 2012/13 to 2016/17

THERE IS POTENTIAL FOR ‘THE DISCONTENTED’
Large institutions with strong rankings and good locations undoubtedly have some advantages in attracting international students. But less-well known, geographically challenged universities are achieving significant growth by adopting aggressive, well-planned and brilliantly executed strategies. Equally, it is true that even being well placed in the league tables, a big player with an established reputation, or part of the Russell Group ‘club’ does not guarantee growth.

I have long held the view that, as Oscar Wilde commented, ‘the world belongs to the discontented’. The challenge for ambitious universities is to maintain a sense of productive agitation for improvement in their approach to international recruitment. Constant attention to every facet of the pipeline is critical in a competitive environment as is a data-led approach and careful targeting of potential students with relevant programs of study.

NOTES
1. ‘HESA student figures include anyone enrolled for more than two weeks on a higher education (HE) course that is primarily based in the UK, unless they are an incoming exchange student, on sabbatical, writing-up or dormant.’ More detail at https://www.hesa.ac.uk/data-and-analysis/students/whos-in-he
2.Individual HESA tables from 2012/13 to 2016/17 were used to compile data in a time series for all universities in the 2018 Times league table. Totals and percentage gains or losses were calculated from this.
3.HESA tables round data which leads to occasional abnormalities in totals but these are minor in context.
4. The largest institutions in the HESA tables not featuring in the 2018 Times league table are University of Wolverhampton, Cranfield and London Business School – these accounted for 3085 students in 2016/17.
4. This blog reflects the HESA tables as published. It is recognised that reporting errors or changes in reporting conventions may have occurred.
5. The numbers shown in University annual reports usually differ from the HESA data. There are a number of reasons, including timing of any ‘snapshot’ used for University purposes.