goingglobal-2_-_6d_-_alan_olsen

Document Sample
goingglobal-2_-_6d_-_alan_olsen Powered By Docstoc
					      Benchmarking International Operations of UK Higher Education Institutions:
                     Structures, Policies, Costs and Efficiencies

Alan Olsen, Director, Strategy Policy and Research in Education Limited, Hong Kong Special
                               Administrative Region of China

                                             Abstract

This session presents key findings from the 2005-06 UK International Office Benchmarking
Survey, commissioned by Hobsons plc, to promote discussion around the current situation,
and best practice, in international student recruitment. This type of research has been carried
out in Australia for several years and a similar model is now being employed in the UK.
Delegates attending this session are able to compare their own approach against the
benchmarks provided and are encouraged to reflect on such questions as:
•   how much is spent on international student marketing, enquiries and admissions?
•   how does this change across different source countries?
•   what conversion rates are experienced for each level of study?
•   how is responsibility for international activities shared across the institution?


This first UK benchmarking study of international operations was undertaken by Strategy
Policy and Research in Education Limited www.spre.com.hk, an Australian-owned company
in Hong Kong. SPRE Limited has undertaken similar benchmarking studies with Australian
universities. Hobsons plc in London commissioned SPRE Limited to undertake the UK study,
and worked with SPRE to identify and make contact with universities in the UK.

Benchmarking at its simplest is a means of comparing one’s performance with one’s peers.
For an education institution, it is the collection of information about an aspect of the
institution’s operations in a way that enables comparisons to be made. The results of the
comparison can then highlight where improvements are needed, where the institution can
learn from others and where problems have to be investigated.

UK universities in 2006 were invited to participate in a benchmarking study on eight specific
aspects of their international operations:
•   the functions and structures of International Offices
•   admissions policies and procedures
•   the costs of international operations as a proportion of on campus international student
     revenue
•   the staffing of marketing, enquiries and admissions
•   costs of recruiting for key source countries
•   recruitment channels and conversion rates from applications to offers to commencements
•   international student services
•   international student mobility.

The focus is on international students on campus in UK. The scope of the study does not
include international students in off-campus/distance/flexible mode, and does not include
international students at offshore campuses.

Universities were invited to participate in all eight aspects, or to cherrypick those aspects
where they wished to participate. Figures were for 2005/06. Questionnaires were distributed
and key terms were defined. A total of 18 universities participated




                                                   1
Each participating university in September 2006 received an individual report and in each
individual report, individual responses were highlighted. Each individual report was different
and no participant’s individual responses were reported to any other participant.

Benchmarking in Australia

Benchmarking of international operations has taken place regularly in Australia since 1998,
and the study went national in 2002. It is conducted each year by the Australian Universities
International Directors’ Forum (a sub group of the Australian Vice Chancellors’ Committee).
Of the 38 universities who are members of AVCC, 34 participated in the 2005 study,
conducted in 2006. Some findings from that study were presented at the Australian
                                                              1
International Education Conference in Perth in October 2006 .

Functions and Structures of International Offices in UK Universities

All eighteen participating universities reported having an International Office.

Three of the eighteen International Offices have Total or Lead responsibility for all four core
functions of marketing, enquiries, admissions and student services. In Australia, the
equivalent figure is 23 of 34 International Offices.

Nine of eighteen international Offices in the UK have Total or Lead responsibility for
marketing and enquiries. One International Office has responsibility just for marketing.

The eighteen universities were asked about the location within their structures of the four core
functions of marketing, enquiries, admissions and student services, whether these functions
are located in the International Office, in another central unit of the university or decentralised
to academic units such as faculties. Responses are in Table 1.

                                          Table 1
                     Location of Core Functions: Numbers of Responses

                                                  International      Other Central      Academic
                                                      Office             Unit             Units
Lead responsibility for international
marketing                                                      17                   1                1
Initial responsibility for international
enquiries                                                      10                   8                4
Lead responsibility for international
admissions                                                      7                   8                5
Responsibility for support services to
international students in the first instance                    8                   9                3

Admissions Policies and Procedures

An issue for admissions staff is the extent to which there is delegation to centralised
admissions staff, in the International Office or in other central units of the university, to make
offers without reference to staff in academic units of the university.

All eighteen participating universities responded in this area of the study
•     in twelve universities, admissions staff are able to make some offers without reference to
      staff in academic units
•     in six universities, admissions staff are able to make offers for all or most undergraduate
      courses, not requiring assessment of portfolios, without reference to staff in academic
      units


1
    http://www.idp.com/aiec/pastpapers/article82.asp




                                                 2
•   in six universities, admissions staff are able to make offers for all or most postgraduate
    coursework programmes, not involving assessment of portfolios, without reference to staff
    in academic units
•   there are no universities where offshore partners are able to make offers for places on
    campus in UK without reference to the university
•   in one university, recruitment agents are able to make some offers for places on campus
    in UK without reference to the university
•   there are no universities where outsourcing partners are able to make offers for places on
    campus in UK without reference to the university.

A further issue for admissions staff is Deposits, whether the university has a policy of
requiring payment of all or part of the first year’s fees as a deposit before an international
student arrives in the UK to commence studies
•   Twelve universities have a policy to require payment of all or part of the first year’s fees as
    a deposit before an international student arrives in the UK to commence studies
•   In three universities this policy is consistent for all international students at all levels of
    education across all source countries
•   In two universities the policy varies by level of education and source country
•   In three universities the policy varies by level of education
•   In four universities the policy varies by source country.

International Office Costs

Marketing, enquiries, admissions and student services can be seen as the four core functions
in an international student programme.

But, in UK universities, admissions for international students and student services for
international students often are located outside the International Office. International Offices
have Shared or No responsibility for admissions in twelve of eighteen responses and Shared
or No responsibility for student services in eleven of eighteen responses.

This leaves marketing and enquiries as the core functions of International Offices in UK
universities and, in terms of International Office Costs, what is benchmarked is the cost of
marketing and enquiries as the core functions of international offices. These results cannot be
compared with those in Australia where, in terms of International Office Costs, what is being
benchmarked is the cost of marketing and enquiries, admissions and student services.

In the UK study, fourteen of the eighteen participating universities responded in this area of
the study, reporting both International Office costs and the budget for income from
international on-campus student fees. This enables benchmarking of International Office
costs as a proportion of international student fee income.

These fourteen universities reported aggregate income from international on-campus student
fees in 2005/06 of £169.02 million. Including commissions, International Office budgets in
2005/06 aggregated to £10.05 million or 5.9% of income.

Chart 1 shows Cost % Including Commissions. It shows the range of the 14 responses, the
average of the 14 responses (9.3%) and the median response (6.3%).




                                                   3
                                                   Chart 1: Cost % Including Commissions


                                     6.3%               9.3%




                           0%                      10%                      20%               30%           40%



There are clear economies of scale.

                            Chart 2: Size of International Student Program and International Office Costs

                           40%
 Cost incl Commissions %




                           35%
                           30%
                           25%
                           20%
                           15%
                           10%
                            5%
                            0%
                                 0                 10               20 Revenue £ million 30          40       50


The Staffing of Marketing and Admissions

Sixteen UK universities reported an aggregate 143.2 staff in 2005/06 dedicated to the
marketing of the university to prospective international students who will study on campus in
UK, whether the staff are in the International Office, in other central units of the university or in
academic units of the university such as Faculties, and an aggregate 15,593 commencing
students. In aggregate, it takes 9.2 marketing staff to achieve 1,000 commencements.

Chart 3 displays Marketing Staff per 1,000 Commencements. It shows the range of the 16
responses, the average of the 16 responses (12.3) and the median response (8.0).

                                            Chart 3: Marketing Staff per 1,000 Commencements


                                      8.0               12.3




                           0                  10               20                     30            40       50



Each staff member in UK dedicated to marketing achieves 108.9 commencements per year,
around one every two days. The comparable figure in Australia is 212.7 per year, one every
day.




                                                                        4
Sixteen UK universities reported an aggregate 158.3 staff in 2005/06 dedicated to the
processing of applications for admission to the university on campus in UK, whether the staff
are in the International Office, in other central units of the university or in academic units of
the university such as Faculties, and an aggregate 15,593 commencing students. In
aggregate, it takes 10.2 admissions staff to achieve 1,000 commencements.

Chart 4 displays Admissions Staff per 1,000 Commencements. It shows the range of the
16 responses, the average of the 16 responses (13.8) and the median response (11.1).

                   Chart 4: Admissions Staff per 1,000 Commencements


                    11.1         13.8




     0                 10                 20                 30                40                   50



Each staff member dedicated to admissions achieves 98.5 starts per staff per year, one every
2.5 days. The comparable figure in Australia is 176.2 per year, one every 1.4 days.

Costs of Recruiting for Key Source Countries

If salaries, publications and scholarships are regarded as fixed costs that generally do not
vary across countries, then commissions, travel, advertising, exhibitions and freight are
country costs that do vary across countries.

Commissions, travel, advertising, exhibitions and freight in aggregate provide a measure of
the country cost of recruiting students from a source country.

Thirteen UK universities reported on country costs, including six universities who were able to
report on costs in UK as a source country.

For these thirteen universities, the country costs in 29 countries/regions aggregated to £5.23
million, including £2.93 million in commissions. From these 29 countries/regions, the thirteen
universities recruited 12,407 international students in 2005/06 at a country cost of £421. This
country cost in 2005/06 included commission of £236. This commission in 2005/06 of £236
per student is the commission for every international student recruited, not just those on
whom a commission was paid.

The UK country cost of £421 per student compared with the Australian country cost of $1,193.
The UK commission cost of £236 per student compared with the Australian commission cost
of $857.

For all thirteen universities in aggregate, Chart 5 on the next page displays Country Cost of
Recruitment by Source Country. It shows the country cost of recruitment, including
commission cost, for each of the 29 source countries/regions in the study, in order of the size
of the country/region as a source country/region.




                                                5
                          Chart 5: Country Cost of Recruitment by Source Country


 £1,000

                                               £855
   £900                                                                                                                                                 £867
           £838                                                         £843                                                                                £840

   £800

                                   £698
   £700
                                                                                                                         £634
                                                                     £568
   £600
                                                              £543
                                                        £494                                                £499                      £504
   £500
                                                                                                                   £433
                             £391                    £405
   £400
                          £313                                                      £296          £312
                                                                                           £286
   £300 £279                                                                                             £259
                                            £211
                                        £194
   £200
                                                                                                     £126
   £100                                                                                                                         £56
                    £26                                                        £16                                                                £23
                                                                                                                                             £0
     £0
                 UK


                 HK
       dd A
                     a




       Sr rea




        Vi a
         Tu a
                     a




                     il
       Th pan




       ng ay
                  ria


                  an




       Ma nam
                     e




      In itius



        Oc we
       Ma tan




                    d




         N da




        m a
         Ca ka




         Ru h
          Gh a


        ng y
       Pa ast




                    o
         Me ia
         Ni ia
                 in




                ny
                 di




                an




                az
                or




     Zi esi
                   i


     Si rke
               an




               es




               xic
     Mi US




               ss
                 s




                n
    Ba orw
              an
              iw




             na
             ge




               b
            lay
            Ch

             In


           leE




             ea
            Ko
           kis




            ap




            Br
           Ke
          lad
           Ja
           ail




             n
          ba
           et
          ur
         Ta




          iL




        do
For all thirteen universities in aggregate, Chart 6 displays Cost of Recruitment by Source
Region, for each of the nine source regions in the study.

                                   Chart 6:Cost of Recruitment by Source Region


  £800
                                                             £708
  £700
                                             £593
  £600

  £500
                                 £390
  £400
                                                                                                                                 £313
  £300
           £211                                                                                   £224          £222
  £200
                                                                              £95
  £100
                                                                                                                                                        £23
    £0
               UK            NEAsia         SEAsia          SthAsia         Americas         Europe             Africa     Middle East            Oceania


For all thirteen universities in aggregate, Chart 7 on the following page shows Cost and
Yield: Country Cost and Number of Commencements for the top fourteen source
countries/ regions, those that were the sources of more than 200 students in 2005/06.

In Chart 7, the countries in the bottom right hand quadrant are those which are large source
countries for UK with relatively low country costs. Ideally, all source countries would be in the
bottom right hand quadrant with China and, more or less, the USA.




                                                                       6
           Chart 7: Cost and Yield: Country Cost and Number of Commencements
                                                           £1,000


                                                               £900
                              Taiwan                   India
                Sri Lanka
                                                               £800


                                   Malaysia                    £700

        Korea
                                                               £600
                      Thailand
                                                               £500
    0           Japan       500                1,000               1,500   2,000   2,500           3,000
                  HK                                           £400
                                   Pakistan
                                       Middle East             £300
                                                                                           China
                 UK
                                  Nigeria                      £200

                                                               £100

                                                       USA
                                                                 £0


From the analysis of country costs and commission cost, the average commission cost per
commencing student in the UK is £236 per student compared with the Australian commission
cost of $857.

There is a difference in cultures about commissions. In the UK, thirteen universities reported
12,407 commencements in 2005/06, with commission paid on 3,094 or 24.9%. In Australia:
eighteen universities reported 43,190 commencements in 2005, with commission paid on
24,435 or 56.4%.

Recruitment Channels and Conversion Rates: Applications/Offers/Commencements

Universities were invited to benchmark conversion rates, from applications to offers to
commencements, by level of study, or by recruitment channel, or by both level and channel.

In total twelve universities provided data for 2005/06 by level of study, enabling, for each level
of study, benchmarking of conversion from applications to offers, conversion from offers to
commencements and conversion from applications to commencements.

In aggregate at all levels in these twelve universities, 81,812 applications resulted in 51,099
offers and 11,237 commencements. Overall, 62.5% of applicants received an offer, 22.0% of
those who received an offer commenced and, as a function of those two results, 13.7% of
applicants commenced.

In 2005/06, twelve UK universities processed 7.3 applications to get a commencement. In
Australia in 2005, 32 universities processed 3.8 applications to get a commencement.

For a UK university, there are six recruitment channels.

International students can be recruited from UK: through the university’s own pathway
programmes in UK, directly from UK with no agent or through an agent in UK.




                                                                  7
Or international students can be recruited from overseas: through the university’s own
pathway programmes overseas, directly from overseas with no agent or through an agent
overseas.

This analysis looks first at the size or relative importance of these recruitment channels.

In total eleven universities were able to provide analysis of the size or relative importance of
recruitment channels, including just five universities who were able to identify numbers of
students recruited from the UK channels. The analysis by size or relative importance covers
7,114 commencing students.

Of these 7,114 commencements, 565 students (7.9%) were recruited in UK and 6,549
students (92.1%) were recruited from outside UK.

Chart 8 shows, for the sample of commencing students in this analysis
•   7.9% of international students were recruited from UK and 92.1% from overseas
•   63.9% were recruited directly, with no agent and 2.7% were recruited through pathways
•   33.4% were recruited through agents.

               Chart 8: Recruitment Channels: Size or Relative Importance



                                                UKPath
                                              60%

                                              50%

                                              40%

                   OSDirect                   30%                          UKAgent

                                              20%

                                              10%

                                               0%




                   OSAgent                                                 UKDirect




                                                OSPath


These results are very different from a sample of 56,772 commencing students in 25
universities in Australia in 2005, where
•   40.3% of international students were recruited from Australia and 59.7% from overseas
•   31.7% were recruited directly, with no agent, and 14.5% were recruited through pathways
•   53.8% were recruited through agents including 15.4% through IDP offices in Australia and
    overseas.




                                                8
In terms of the efficiency of these recruitment channels in converting from application to
commencement, just five UK universities, with 3,317 commencing students in 2005, were
able to provide analysis.

Chart 9 looks at the efficiency of conversion from application to commencement for each
recruitment channel, without any regard to the volumes for each channel. The relatively
smaller pathway channels are, as expected, the most efficient in conversion from applications
to commencements, and the relatively larger channels are less efficient in conversion from
applications to commencements.

                    Chart 9: Conversion Rates by Recruitment Channels


                                                UKPath
                                              70%

                                              60%

                                              50%

                                              40%
                   OSDirect                                                UKAgent
                                              30%

                                              20%

                                              10%

                                               0%




                   OSAgent                                                 UKDirect




                                                OSPath



The pattern in Australia, in 23 universities with 54,409 commencing students in 2005, is
remarkably similar.

International Student Services

In fifteen universities in UK in 2005/06, 159.7 staff provided international student services to
27,353 international students, a caseload of 171.3 students per staff member, or 5.8 staff
members per 1,000 international students.

The caseload in Australia in 2005, in 33 universities with 133,442 international students, was
255 students per staff member, or 3.9 staff members per 1,000 international students

Chart 10 for UK displays International Student Services Caseloads in terms of number of
student services staff members per 1,000 international students. It shows the range of the 15
responses, the average of the 15 responses (9.6) and the median response (6.0).




                                                9
             Chart 10: International Student Services Staff per 1,000 Students


                           6.0                       9.6




     0        2        4           6      8         10      12       14       16       18          20


International Student Mobility

In eleven universities in UK in 2005, there were 26.95 (fte) staff dedicated to international
student exchange programmes involving 3,270 exchanges (incoming exchanges plus
outgoing exchanges) in 2005/06, a caseload of 121.3 exchanges (incoming exchanges plus
outgoing exchanges) per staff member, or 0.82 staff members per 100 exchanges.

The caseload in Australia in 2005, in 32 universities reporting 9,780 exchanges (incoming
exchanges plus outgoing exchanges) was the same as in UK, 122.1 exchanges (incoming
exchanges plus outgoing exchanges) per staff member, or 0.82 staff members per 100
exchanges.

Chart 11 for UK displays International Student Mobility Caseloads in terms of number of
international student exchange staff members per 100 exchanges (incoming exchanges plus
outgoing exchanges). It shows the range of the 11 responses, the average of the 11
responses (1.2) and the median response (0.8).

           Chart 33: International Student Exchange Staff per 100 Exchanges


              0.8            1.2




    0                  1                  2                 3                  4                    5



Next Steps

2005/06 was the first year of benchmarking international operations in UK higher education
institutions. Eighteen universities participated, there have been lots of gaps, but perhaps also
lots of useful data. Eighteen universities have received reports. There has been a
presentation at the British Council’s second Going Global Conference.

Hobsons plc and SPRE Limited are committed to replicating the study in 2006/07, perhaps
with a 30 June 2007 deadline, perhaps with a larger number of participants.




                                               10