June 1, 2011

Building private self financing Higher Education

Quite a number of self financing professional education institutes are coming up all over India as per the plans of the government to expand this sector to enhance the enrolment from current 13 percent to 25 percent by 2015. Such institutes are regulated by AICTE, UGC and the afflicting universities to check the quality standards. I don’t wish to comment on the effectiveness of the mechanism in this piece as I would like to address the larger issue of institution building.

Generally most businesses, at least in India, are inspired by the success stories of the pioneers & current leaders of the sector. Therefore when private engineering colleges came up in south India they tried imitating the systems practices of the popular government run institutes. Following the south region, such activity began in North India in late 1990s peaking in the period 2000-2004. Unfortunately most new institutions did not focus on upgrading the value offer over the existing ones as is the normal practice in business but took a narrow profit seeking view of the entire process. Consequently students enrolled themselves at the nearest, cheapest institute with the objective of acquiring the degree without going through the rigor of learning process.

India has been saddled with ever new institutes that showcase work in progress campuses, relaxed classroom environment with security of getting the paper called a degree that promised to unlock the doors of high flying careers annexed through hook and crook. Each new institute had no problem of filling the allotted seats till 2009 so the process kept on uninterrupted. Scene changed after 2009 as even the established institutes faced with falling admission numbers and stagnant revenues.
Large education management groups have deep pockets that enable them to bombard media to create an impression of being a market leader in their region & domain. But the large number of single campus institutes do not have the financial muscles to factor in the media spends. Let us first investigate the reasons of fall in admission to professional higher education in India.

There is a general agreement that lack of academic excellence at new higher education institutes is the prime culprit in driving students away from higher education. It’s followed closely by the lack of new available jobs for the fresh graduates. Some institutes believe that poor branding of their institutes is also responsible for the crunch. These are the points on which there is a general agreement amongst the players. Interestingly all these point to a traditional product led approach followed by people at the helm in these education enterprises.
Most important factor responsible for decreasing admissions into higher education could be traced to stagnation of land prices across India. The spike in land prices during 2002-2007 generated large surplus incomes for the semi urban areas which allowed them to send their children to expensive higher education institutes. Post 2009 there is lull in land prices has forced the households to cut back expenditure on education leading to students preferring low cost diplomas over high cost professional degrees.

Branding an higher education organization in such a scenario requires strategic alignment to the students profile in the particular region. Mass media advertising is great source of recall but has limited value in building an education brand. An intensive institute wise analysis would be required to carve an effective branding. A general list of factors that lead to creating powerful brand is as give below;
1. Infrastructure beginning with the entrance
2. Quality of the staff & faculty
3. Proximity to the centre of industry & trade
4. Curriculum & quality contents in classroom
5. Industry interaction
6. Transport system
7. Technology base
8. Global exposure

1 comment:

Ashish Arora said...

Great analysis, I believe "differentiation" holds the key to survival in this war for survival of higher education institutes. The differentiation can be anywhere, right from student intake to pedagogy to I distrust alliances to placements. I am strong follower of your thoughts, hope to meet you whenever I am in Chandigarh next time, keep the good work.

Regards,

Ashish Arora

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