UNITED KINGDOM

Transnational education at the heart of international business strategy
Universities increasingly pursue transnational activities in an effort to develop their market reach. Transnational education, which encompasses all the activities that allow a student to study in a country other than the one of the awarding institution, has gained attention and has been subject to various debates.Probably the most debated area has been about the role of transnational education in the future development of the international student market.
On the one extreme are those who consider transnational education as a direct substitute for international student mobility and argue for its elimination on the basis of a zero-sum effect. On the other side of the debate are those who consider transnational education as the future driving force for exporting higher education services.
So far there has not been solid evidence as to which of the two is true. The complexity and dynamic nature of transnational education activities along with the lack of consistent and extensive data are some of the factors that perplex and hinder research on this issue.
OBHE research
The extent to which transnational education acts as a substitute for international student mobility was explored in a research project commissioned by the Observatory on Borderless Higher Education, OBHE, in the United Kingdom.
The research deployed a mixed methods approach combining quantitative data from UNESCO and the Higher Education Statistics Agency, HESA, and qualitative evidence from interviews with key people in transnational education host countries.
The countries included in the research were Malaysia, Singapore, Hong Kong and China, which represent over 50% of the UK transnational education market.
The research explored the outbound mobility of students from these countries towards the UK and compared it with trends in the number of students in UK transnational education.
Also, the outbound mobility destination countries were investigated in an effort to establish an understanding as to how transnational education development has affected the attractiveness of the UK as a destination for internationally mobile students.
Building local capacity
Across the different countries, data show that outbound mobility has either declined or slowed, with the exception of China where it has increased significantly. Also, data show that inbound mobility has increased in the key host countries of UK transnational education.
The UK has maintained its position as one of the top international destinations for students in all countries of the research. Contrary to this, there is evidence to show that Australia has been impacted as a destination of international students, particularly those from Singapore and Malaysia.
Overall, quantitative and qualitative data show a distinct role and identity of transnational education versus international student mobility.
Transnational education does not seem to act as a direct substitute for international student mobility. Instead, outbound mobility declines in most UK transnational education host countries as a result of coordinated government efforts to increase the capacity of their higher education systems.
However, the extent to which students would consider substituting international mobility for transnational education will be subject to various contextual factors.
Specifically, a substitution effect would depend on: 1) the gap between demand and supply for higher education; 2) the recognition and integration of transnational education in the formal higher education system of the transnational education host country; and 3) the physical presence of the awarding institution.
This means that in different phases of an offshore higher education market lifecycle, transnational education might substitute for international mobility due to the wide gap between supply and demand. Nevertheless, this would be a short-term phenomenon.
As supply grows, students’ decision-making will be based more on pull factors (for example the reputation of awarding institutions, employability, quality) and less on push factors (for example insufficient capacity in the domestic higher education system).
Additionally, the recognition and integration of transnational education activities in the domestic higher education system play a significant role in its attractiveness as a choice for prospective students.
Hedging bets
Students in transnational education host countries where supply exceeds, or covers, demand for higher education, tend to prefer more direct contact with the awarding institution.
This implies that as supply grows, partner-supported delivery – such as a franchise – becomes less attractive in comparison to the physical presence of the awarding institution – for example, in the form of international branch campuses.
The decline in the growth of outbound mobility towards the UK is not related to transnational education alone, but is more of an inevitable outcome of capacity-building policies in countries that send international students, primarily in Asia.
This will continue to occur as countries in Asia continue to build their higher education system capacity and quality. This is something that is supported by macro-economic stability and a prosperous employment market in these countries.
There is evidence to show that the UK will continue to be a top destination for international students, but the size of its inbound student market could stagnate, if not decline.
So it is not a question of transnational education replacing international student mobility but rather of UK universities hedging their bets against anticipated stagnation of the international student market by using transnational education to participate in the capacity-building efforts in the source countries of international students.
However, this requires transnational education to be considered carefully as part of a well thought out international business strategy rather than as a peripheral activity. This involves exploring the current phase of the market lifecycle as well as longer term market developments in transnational education host countries.
Another key factor for the long-term success of transnational education activities is the ability of the awarding institution to dedicate resources to supporting the future development and transformation of its transnational education operations so as to respond to market lifecycle conditions.
The report concludes with a developmental process policy model that captures these dynamics.
* Dr Vangelis Tsiligiris is college principal of the College of Crete, Greece, and a researcher in cross-border higher education. He curates the topic Cross Border Higher Education and leads the Linkedin group Transnational Higher Education. For more than 10 years he has been engaged in setting up and leading transnational partnerships involving UK and other European universities. Email: tsiligiris@hotmail.com. The OBHE report is available here.