In my most recent post, I looked at some interesting relationships between Kaplan and several traditional non-profit institutions of higher education. In this post, I want to look at some of the relationships that Laureate is developing as it continues to evolve its globalization strategy.
Laureate Education, like Kaplan, has a branch accredited by the North Central Association - Walden University. Walden (which incorporated the old National Technological University) is an exclusively on-line provider and so can be accessed around the world. Walden is just one component of Laureate’s online stable which also includes Laureate online education, BV, OnlineLearning.net, and Canter. However, the main thrust of Laureate’s strategy is bricks and mortar in the global arena. It has created its global network of institutions of higher education primarily by buying existing accredited private colleges and universities. This network currently has nearly 250,000 students world-wide. Laureate has begun to seek US accreditation for several of its offshore schools, and, for example, its Glion Institute of Higher Education and Les Roches Swiss Hotel Association of Hotel Management have both been accredited by the New England Association of Schools and Colleges.
Recently, Laureate has begun to expand into regions that either do not permit for-profit higher education, or that require local ownership. This has led the company to create other types of arrangements than they have used in the past. One example is the November 2006 arrangement with Istanbul Bilgi University, a prominent non-profit Turkish university. Turkey does not allow for-profit higher education, so a typical purchase agreement was not possible. In this case, Laureate, in partnership with parties in Turkey, has provided 50% of the funding for a company that will provide technology, financial management, student and human resource services to Bilgi. As part of this arrangement, Bilgi joins the Laureate University Network, which opens up opportunities for Bilgi students for study abroad and exchange programs at campuses of other members of the Network. Additional goals of this partnership are reported to be expansion of Bilgi in Turkey, and creation of new campuses in other countries of the Middle East and Russia. Thus, Laureate and Bilgi have found a cooperative arrangement that plays to the strengths or special advantages of each. As a consequence, Laureate will gain a platform for entry into the Middle East, and Bilgi will benefit from Laureate’s expertise in management and gain access to capital markets that will enable it to expand aggressively. One has to imagine that Laureate's experience in entering new markets will play a major role in Bilgi's expansion plans. Could well be a win-win situation.
The Dutch corporation K.I.T e-learning and the University of Liverpool began a partnership in 1999 to deliver master’s programs online. This program became relatively quite successful in terms of enrollments, with over half of its students being drawn from outside the UK, from over 80 countries . Since this post is about Laureate, it should come as no surprise to learn that Laureate bought KIT in 2004, changing its name to Laureate Online Education BV. Part of the purchase involved a 10 year agreement between Liverpool and Laureate which involved a significant expansion of Liverpool’s online programs.
In September 2006, this partnership between Laureate and Liverpool moved to a different level with the opening of the Xi’an Jiatong-Liverpool University (XJTLU) in Suzhou, China. This new, independent university is the product of a partnership between Liverpool and Xi'an Jiatong University. XJTLU offers Liverpool’s bachelors degrees in science, engineering and management. GlobalHigherEd has an update on the current offerings, and the rapidly growing student body. The financial backer for Liverpool in this partnership is Laureate, which has provided the financial guarantees required by the Chinese government as well the cost of the buildings to house XJTLU. Liverpool expects that XJTLU will both act as a feeder for its home campus in the UK, and be a purchaser of curricula, quality assurance, etc.
Obviously this partnership must be viewed positively by both partners, because at the end of April 2007, Laureate and Liverpool announced yet another agreement. This one has a number of goals:
Study Abroad Opportunities - new study abroad programs for both students of the University of Liverpool and Laureate institutions worldwide.
Summer School at the University of Liverpool - a study abroad program for students at Laureate institutions to perfect their English language skills while earning academic credit during their summer break.
Dual Degrees - programs that provide students the opportunity to earn two degrees by conducting part of their studies at a Laureate institution and the remainder of their studies at the University of Liverpool.
Consulting and Curriculum Design - joint development and sharing of leading curriculum in several fields, including health sciences, information technology and the humanities.
University of Liverpool programs onsite at Laureate Institutions in Europe, Latin America and Asia - expansion of Laureate students' access to the University of Liverpool's world-renowned programs, thus helping students who want the benefit of a UK education but are unable to leave their home country.
Interestingly, one sees in these various agreements a number of different types of relationship between Laureate and Liverpool. At the lowest level is service provision - Laureate provides the platform for Liverpool’s on line programs. Even at this level, however, Laureate is providing additional resources so that Liverpool can expand its offerings and reach. The XJTLU arrangement seems relatively parallel to that at Bilgi, with the added complexity of a Chinese partner university and the creation of XJTLU as an independent university. Nevertheless, it would appear that the University of Liverpool will be responsible for the academic side of the partnership, and Laureate, through its access to capital markets, will see to the financial side. One might imagine that Laureate will also be providing very useful management support to XJTLU, and using its experience in dealing with foreign governments to facilitate operations.
The most recent agreements focus more on Laureate the university system, rather than Laureate the financial and management provider. Here, one sees some types of agreements that are quite common between peer institutions of higher education - opportunities for students to go to the partner institution for study abroad, dual degree programs, joint development of curriculum. What is unusual is implication that, at least in the areas of discussion, a traditional non-profit university and a for-profit university can be considered to be peers.
The recent agreement also indicates that there are discussions regarding Liverpool setting up onsight programs at one or more of the Laureate Institutions. It would be interesting to know how the Laureate management thinks about handling brand management if some of their campuses get “co-branded” in this way. However, the existing academic and administrative infrastructure at these campuses would make it easy and effective for Liverpool to set up very visible branch campuses by outsourcing administrative and teaching modules to Laureate while retaining curricular and quality control modules.
Finally, those who have also read the post Interesting activity at the for-profit/non-profit interface: Kaplan will certainly have noticed that the University of Liverpool is also involved in a number of projects with Kaplan. Kaplan and Laureate are following very different strategies as they globalize, and the involvement of Liverpool with both is indicative of the breadth and variety of approaches that Liverpool is taking in its own efforts to globalize. Certainly, some of Liverpool’s initiatives will work out better than others, but they are doing the right thing in this rapidly changing world - experimenting.
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How quickly times have changed! Now with all the new legislation pending for for-profit colleges that could hurt them, I wonder how Kaplan has coped? Finding the right accredited online college for each student is key to the first step of education success.
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Posted by: University Bound | February 23, 2011 at 11:49 AM