Academic Joint Ventures
Ensuring the Business Aspects are Successful
Co-Authors
Steven D. Berkshire, EdD, MHA Regis University
Peter Bemski, PhD Regis University
14th Annual World Forum
Colleagues in Jesuit Business Education
International Association of Jesuit Business Schools
Business and Education in an Era of Globalization:
The Jesuit Position
July 20-23, 2008
Academic Joint Ventures – Ensuring the Business
Aspects are Successful
Steven D. Berkshire, EdD, MHA Regis University
Peter Bemski, PhD Regis University
Introduction
As with any business partnership between an U.S. corporation and a Latin American corporation, universities that partner to offer academic programs must consider the financial and operational aspects of such partnerships. This paper deals with international partnerships between universities as laboratories for collaboration between businesses. The elements that make for a successful joint venture go beyond the academic issues of content and how that content is delivered to students.
This paper deals with the business and inter-university relationships in developing and implementing joint or collaborative degree programs between universities. It does not deal with traditional exchange programs or dual degree programs where one of the universities is the dominant institution at which the students actually earn the degree.; rather the collaboration here deals with the joint development and offering of curriculum by the institutions as equal partners that leads to the awarding of a joint or collaborative degree.
Regis University, founded in 1877, is one of twenty-eight Jesuit universities in the United States. The university enrolls more than 16,000 students who study at its Denver, Colorado campus, seven other regional campuses and online via distance learning. The University has developed relationships with the University of Ulster in Northern Ireland, the National University of Ireland in Galway, Ireland, and ITESO in Guadalajara, Mexico as well as other relationships with schools in other parts of the world. This paper concentrates on the relationships with the Ulster, Galway and ITESO for purposes of the research model.
The University of Ulster is the major university in Northern Ireland and is part of the higher educational system in the United Kingdom. Ulster is similar to Regis University in that both have multiple campus that serve diverse populations and both have extensive online educational programs. The National University of Ireland in Galway is involved in extensive educational partnerships throughout Europe and in Asia as well as providing extensive continuing education degree programs for working adults within the country. ITESO, located in Guadalajara, Mexico, is a Jesuit university as is Regis University. ITESO offers a significant number of academic and continuing professional development programs for working adults and via its distance education programming. ITESO participates in an extensive network of schools throughout North and Latin America as well as in Europe and Asia.
Literature
The educational literature has a great deal of research concerning the traditional student exchange programs between international universities as well as study abroad, and dual degree programs, yet there is little about the development and operation of jointly developed and operated degree programs. The dual degree programs in the literature tend to be collaborations where one of the universities offers the degree (typically the U.S. partner) and the other school provides students. In many cases these dual degree programs allow the students of either school to transfer a specific number of courses into the other degree and to take courses at each school. But the students are usually considered degree seeking at the dominant partner in the relationship.
What needs to be looked at is how we develop and ensure that both the U.S. school and the school in the other country is a full and equal partner in the collaboration. One such partnership that seems to signal such a change is the joint partnership between the British Council and the nation of Brazil. In an article describing this partnership Canto and Hannah (2001) stated that “(e)quality in the provision of funds has a practical and symbolic significance …, signifying that this is a collaboration that sets out to replace traditional north-south relationships of donor and recipient with genuine academic partnerships” (p. 27.) What the authors were trying to say and what seems to be needed in developing such international collaborations is that there is a need for mutual respect and participation where both organizations bring similar or complementary skills and resources to the table as opposed to the traditional model which typically has the U.S. or European university providing the actual educational opportunities at the U.S. school with the majority of the students coming from the other country.
What their paper attempts to do is examine the relationship between the U.S. school and the Latin American school in a different light. Canto and Hannah (2001) paraphrased Altbach (1981) in which Altbach commented on the dilemma third world universities then had in gaining recognition even though academic performance and research in the third world had improved greatly over the years since World War II. It seems that the perception was that the institutions in the U.S. and Europe have the monopoly on knowledge and the third world is in need of that knowledge. Such attitudes continue and have limited cooperation and collaboration. Canto and Hannah believe that since the late 1970’s schools in the U.S. and Europe have entered into horizontal partnerships that include three elements: “(a) the existence of previous knowledge of the other partner to establish realistic expectations” which came from Samoilovich’s work in the 1990’s, “(b) the genuine sharing of each other’s experiences” which they got from work done by Balan in the 1990’s, and “(c) the application of each other’s knowledge rather than a one-way transfer” of knowledge from the dominant school, which came from work done by Bor and Shute in the 1990’s. (2001, p. 32.)
Some issues identified by Canto and Hannah (2001) include:
- having a clear understanding of each partner’s strengths and weaknesses,
- having a great deal of trust in each other,
- low levels of conflict
- an equal partnership where both partners are respected for what each brings to the relationship,
- recognizing that language can be a barrier, and
- having respect for each school’s cultural differences.
Canto and Hannah (2001) also looked at three links that need to be considered. These are linguistics, sociology, and technology. Each of these needs to be considered when developing a partnership where both schools play an equal role in developing the academic curriculum and planning the business model for operations. This was re-enforced by Shaw (2006) who speaks to the importance of understanding political environments in each country as well as within each institution involved in the partnership. He further commented that the “(s)tability of a joint venture refers to the longevity of the relationship, and it is dependent, in part, upon the combination and communication between the…partners” (p. 439.)
Shaw (2006) also identified barriers that must be considered in developing partnerships in the academic arena. These tend to support what Canto and Hannah (2001) noted in their research. Shaw spoke to financial support, division of work and control, conflict, cultural differences, and environmental factors (p. 442.)
An interesting fact is that international joint ventures have declined in number over the past decade (Popper, 2002) and while Popper is speaking generally about multinational companies, she notes that much of the decline is because the partners have different interests. Popper’s comments tend to support the discussion above concerning issues to be watchful about when developing collaborations between U.S. or European universities and their counterparts in Latin America.
Chowdhury and Chowdhury (2002) comment that it is important to develop “synergy among the partner firms (p. 52.) They further speak to the symmetric firms having an incentive for forming the partnership in the need to increase demand (p. 57.) If this is translated into an educational partnership, then the goal may well be to increase demand for higher education in one or both countries – or at least the demand for an education from the partner schools.
Finally Nadler and Nadler (1990) speak to the need to consider the human resource requirements in joint ventures. They commented that “the variation in cultural norms from country to country should be recognized and understood” (p. 71) when considering human resource issues. Each partner may have different skills and knowledge to lend to the collaboration and this needs to be understood and planned for. Nadler and Nadler further noted that both partners in a joint venture must understand that each partner may lack some human resources capacity and that may need to be developed.
Lessons Learned from Regis University and its Partners
Relationship Building
The literature clearly noted that one of the keys to success with international collaborative ventures is the development of relationships (Canto & Hannah, 2001, Shaw, 2006, Popper, 2002, Chowdhury and Chowdhury, 2002, and Nadler & Nadler, 1990.)
Based on an analysis of the international collaborations between Regis University, Denver, Colorado and the three international partners introduced earlier, relationship building probably is foremost in those elements that ensured success and when not fully developed, resulted in failure.
Prior to starting to develop any academic programs with ITESO in Guadalajara and the National University of Ireland in Galway (NUIG) both schools spent considerable time getting to know each other. In the case of NUIG the partnership began with senior officials at both schools meeting through a third party and then simply exploring potential opportunities over a couple of years. The same occurred with ITESO. Representatives of both schools first met through a conference sponsored by AJCU and AUSCAL in Guadalajara and then about a year later at an IAJBS educational conference. That led to further contacts and visits. During these meetings and social contacts, both parties got to know the people and their cultures, and developed a trusting relationship. In the first case, these contacts led to the formation of a joint Irish Studies program online between NUIG and Regis University. The program was designed to be small in order to develop a working relationship and has continued. Later that program led to the development and implementation of an online graduate degree in software engineering. The relationship at ITESO resulted in implementation of a joint MBA degree where students from both schools can earn an additional degree from each by taking core courses at the home institution and then a series of courses at the other. This relationship is now allowing ITESO and Regis University to look at moving into a jointly offered degree for the rest of Latin America.
An example of a program that probably failed because the relationship was not adequately developed before trying to implement a program was the joint MS degree in International Management between Regis University and the University of Ulster in Northern Ireland. Here the decision to move forward was made very quickly by the top administrators in each school. No time was allowed for the faculty of each university to get to know each other and work together before planning. This resulted in miscommunications about curriculum, policies, culture in each country and the schools themselves, as well as other administrative issues. When the numbers of students did not materialize in the beginning, it was easy to simply terminate the agreement.
Relationship building in any business venture is vital to the success of the venture. In higher education it may be even more important since the success of the joint venture or collaboration depends on people entirely. The strength of the Regis-NUIG relationship is a personal one between a couple of individuals at each institution that has led to other personal relationships between faculty and staff at each school. While there is a common language, there are still differences in culture and framework. ITESO is a Jesuit university as is Regis University so there was an existing bond, yet it was the development of the personal relationships between faculty and staff at both schools that ensured a successful partnership.
Financial Issues
Financial issues can be a deal-breaker if not handled appropriately in any joint venture, but perhaps even more so when working across international borders. The development of a strong trusting relationship will help both partners work through conflicts that may arise concerning who contributes what financial and physical resources and how expenses are accounted for.
The relationship with ITESO was assisted by a grant from the First Data/Western Union foundation that provided monies to do some conferences in Mexico for civil sector workers and organizations with ITESO and others taking a leadership role in Mexico. The grant also provided dollars to start planning a certificate (diploma) program in the civil sector area and for bringing some faculty from ITESO to Regis during the summer intensives the University holds each year. From this beginning the business and management faculties began talking about the joint MBA concept which later developed into the current offering between the two schools.
There are a number of ways to develop the business plan that can impact the financial resources needed for the successful implementation of the collaborative effort.
One model is to simply have each school pay for its own costs and then split the revenues generated. This avoids the problem of determining methods for allocating expenses. Each institution decides what budgetary expenses should be included in the project. It may also avoid the problem of costs at one location being more or less than the other. One disadvantage may be that the model relies on each to equitably support the operational expenses. If the collaboration is online there probably needs to be some formula for the online production and hosting of the courses. Sharing the revenues also has advantages and disadvantages. It does assume that there is some equity in the numbers of students recruited by each partner; otherwise, it is possible one school is contributing more than the other.
A second model is to still have each school budget its own expenses, but have each school keep the revenues it generates through its own recruiting efforts. This model might include each school compensating the other when a student takes a course(s) from the other school. Or each school simply keeps the revenue it generates. The advantage to this model is that it is clear and each school is separately at risk. The disadvantage is that assuming costs are equal in most cases, one school may generate more revenue than the other one and therefore the partnership might be uneven.