JOINT VENTURE PRESENTATION

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JOINT VENTURE PRESENTATION

• OECD forum
• 12 October 2004

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JOINT VENTURES GROWING THE FUTURE

• Jenny Hannan
• Group General Manager Education
• Insearch, University of Technology Sydney

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Overview

• History of Insearch UTS and joint ventures
• The education environment
• Joint ventures
• Motivation for developing a joint venture
• Joint ventures the basic necessities
• Joint ventures marriages made in heaven?
• Critical success factors
• Benefits

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History Insearch UTS joint ventures

• Recent awards
• 2003 National Education Exporter of the Year
  Award
• 2002 NSW Exporter of the Year Award
• 2004 UTS Human Rights Award
• Insearch UTS
• Controlled entity of the University of Technology
• 1987 began delivery of education programs
• 1991 introduced the pathway model for
  international undergraduates to articulate to
  university programs.
• - Pathway program principles access to
  education, internationalisation and recognition
  of prior learning.
• 1994 Joint venture with Shanghai university to
  establish the Sydney Institute of Language and
  Culture SILC. 1994 200 students and a single
  program. 2004 2,700 students will multiple pre
  and undergraduate programs.

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History continued...

• 1994 Joint venture with International
  Development Program (IDP), the Australia Centre
  ChaingMai, Thailand
• 1994 Joint venture with IDP, the Australian
  Centre, Medan
• 2002 Joint venture with IDP, Australia Centre
  for Education and Training (ACET), Ho Chih Minh
  City, and ACET Hanoi
• 1996 Joint venture with the International Office
  of the University of Technology to publish IELTS
  preparation books and run the UTS IELTS testing
  centre
• 2003 Joint venture with the Australian
  Broadcasting Commission, ABC Asia Pacific, for a
  26-part series on IELTS broadcast across Asia and
  the subcontinent with www text and sound linkage

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History continued...

• 2003 Insearch and UTS contract with the
  government of Vietnam for the delivery of
  lower-secondary teacher training in Vietnam as
  part of an Asian Development Bank project. The
  project involves the delivery of the UTS Masters
  of Education degree in collaboration with Hanoi
  University of Education, Universitat Potsdam and
  the University of South Australia.
• 2004 Joint venture with the University of Essex,
  UK

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and the future

• 2005 Joint venture with the Beijing Language and
  Culture University and the University of
  California for an English language training
  institute in Beijing, planned opening in March
  2005 with 200 students.

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The Education Environment

• 1980s
• Australian government funded study for
  international students decreased
• Growth in global trade had implications for
  internationalising the education system
• Inadequate education infrastructure
• Australian international education in1990s
• Growth in transnational education delivery
• - 18.3 in 1996
• - 26.9 in 1999
• Growth in transnational programs
• - 200 in 1996
• - 500 in 1999

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The Education Environment cont.

• 2000 and beyond
• 2001 1,000 partnerships in existence (AVCC,
  2001)
• 2002 transnational study 36 of the
  international student population (IDP, 2002)
• 2025 transnational study predicted to grow to c.
  44 of the international student population
  (DEST, 2002)

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English language and transnational study

• Predictions are that by 2010, 76 of the global
  demand for English
• Speaking destinations will be absorbed by
  countries in Asia,
• Particularly China and India
• (Joint IDP and British Council report, Vision
  2020 Forecasting
• International Student Mobility April 2004)

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Joint Ventures
The growth in transnational education is a key
driver for education joint ventures. Global
access to education is a political priority and a
key driver for joint ventures One of the
real threats to the future is that 85 percent of
the worlds population has inadequate provision
in education infrastructure.
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Joint Ventures and the scale of commitment

• Type of relationship Example Scale of Commitment
• no relationship No commitment
• one-off transaction delivery of one course
• co-development allianceonline consortia /
  national branding
• minor-equity alliance public-private
  partnerships / franchises
• shared-equity alliancejoint ventures
• merger / acquisition High commitment

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Motivation for developing a joint venture
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• The following areas need to be considered when
  forming a joint venture
• Capital
• Branding
• Expertise
• Resources
• Cultural
• Legal
• National/local government support

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Joint ventures the necessities

• (From Delloitte. Its Down to Business with the
  Reality of Growth,
• Guide 2)

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• Success in a joint venture depends on the choice
  of JV partner.
• Successful choice depends on
• The partners sharing similar objectives
• The partners commitment to making the JV work
• A reward from the relationship, and
• An equal share in the risks and rewards.

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• If there is a fit with your organisation and the
  prospective partner
• Financially
• Operationally
• Legally, and from a
• Governance / regulatory perspective
• If you have researched your potential partners
  track record in
• Maintaining relationships
• Resources to commit to the venture, and
• History of long-term commitment
• then the building blocks for an alliance are in
  place.

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Joint Ventures Marriages made in heaven?
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• Two quotes
• Breakdowns in business alliances in Australia
  will outstrip marital
• Breakdowns by 50 in five years.
• - Walter Dinale
• Leader Deloittes Growth Initiative
• Quite simply, where there was a mismatch between
  the Australian
• University and the overseas education provider on
  the primary objectives
• and vision for the relationship, deterioration
  and potential termination in
• the relationship often occurred
• - Heffernan Poole
• Catch Me Im Falling Key Factors in the
  deterioration of offshore
• educations partnerships.

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Critical Success Factors

• Assuming that financial, legal, and regulatory
  elements are stable, the two critical factors
  are
• Communication
• Shared goals and vision

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Communication and shared vision

• High levels of internal commitment communicated
  clearly and consistently, including
• Involvement of senior management
• Involvement of link departments (eg. Library,
  student administration, academic staff)
• Appointment of a relationship manager
• Creation and propagation of protocols and
  responsibilities

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Benefits

• There must be real benefits for both partners. If
  the partnership is
• successfully established, it will provide
• Shared financial commitment
• Shared risk
• Growth
• Mutual learning professional development
• Increased research capacity
• Widening markets / programs / opportunities

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Thank you