risk and reward in international student recruitment”

ICEF Berlin

“Risk and Reward in International Student Recruitment”

©All material strictly copyright Barton Carlyle 2014 Berlin, 2014

Strategic Risk 2

Risk & Reward

Strategy

Recruitment

Developing Strategy 3

External Forces:Global Student Mobility

Education system dynamics

Economic conditions

Immigration/visa regulations

Student choice

Technology

Rankings

Competition

Internal Forces:Culture of organization/provider

Resources

Curriculum

Reputation & rankings

Technology Infrastructure

Internatiionalization goals

Staff capability/experience

International PositioningMarketing/branding

Partnerships

Recruitment Plan

Metrics

Communications

Risk Management 4

Corporate perspective suggest that Strategic risk is…

“everything, every obstacle, every

issue that has the potential to

materially affect the achievement

of our strategic objectives.” Dr. Georg Klein, Siemens AG

Source: Deloitte survey (2013)

“Risk is uncertainty, but we have to take risks to get to our

goals, especially during changing times”. Sandra G. Carson, VP, Enterprise Risk Management and Compliance, Sysco Corporation

Risk Management 5

“Reputation risk is now the biggest risk concern, due in large

measure to the rise of social media, which enables

instantaneous global communications that make it harder for

[companies] to control how they are perceived in the

marketplace”. Deloitte 2013.

Risk Management 6

Market • Environment

uncertainty

Portfolio• Business

Model Uncertainty

Strategy• Industry

uncertainty

External ec, pol, social

and physical environment

Legislation

Demographics

Capabilities

Programs and services

Organisational flexibility,

technology, competitive

strategy

Effects of competition

Customer behaviour

Technological innovation

(industry level)

Risk Management 7

Portfolio Risks Strategic Risk

ProgramsPricing

Channels

Competition

Student Mobility Trends

Soc-EcImpacts

Strategy Delivery

Market Risks

Environment

Can’t control:

Understand and navigate through market research and market

intelligence systems

Business Model

Can control:

Portfolio of programs and services, choice of

mediators

Industry

Can influence:

Benchmarking, best practice, collaboration,

professional assocs

Risk Management: Risk Profile 8

1) Assess appetite for risk….

2) Consider how this varies by

market

3) Evaluate real activity

4) Consider how this varies

from perception of risk

appetite

5) Produces understanding of

risk profile

Mission and Vision, Growth targets, portfolio balance, Offshoring interest, senior management capacity

Strategic Plan

Relevance to global issues, learning and career outcomes, range of curricular methodologies

Programs

Govt partnerships, agent networks, sponsor links, research collaborations (Univs), institutional collaboration, offshore offices

Partnerships

Patterns of communications, digital and social media capabilities, alumni networks, staff networks, study abroad

Reach

Market intelligence and market research investments, patterns of competition

Market understanding

Trends, Market dependencies, market development capabilities

Enrollment patterns

9Risk Management: Risk profile

Risk: What’s your profile? 10

Managing Risk

Strategic Market Structural Reputation Program Management Financial

TYPES OF RISK IN IEM

11

Managing Risk Put together a risk register:

Simple spreadsheet

Describe the issue

Describe the potential impact of the risk

What will warn you that this risk is out there?

Quantify the impact

Quantify the probability/likelihood

Assign a value (product of impact x likelihood values)

How often will you monitor?

What actions will you take to mitigate the risk?

Who owns it?

Managing RiskWhat type of risk?

Risk/Issue?

Potential impacts?

Triggers/warnings?

Impact VH/H/M/L (# or %)

Probability VH/H/M/L (# or %)

Risk Value

Monitoring Actions

Mitigating Actions

Impact x probability = risk value

VH/L VH/M VH/H VH/VH

H/L H/M H/H H/VH

M/L M/M M/H M/VH

L/L L/M L/H L/VH

Imp

act

Probability/Likelihood

Managing Risk: Risk Mapping

Key # %

VH Very High 5 100

H High 4 80

M Medium 3 60

L Low 2 40

VL Very Low 1 20

Adapted from KPMG sources © Barton Carlyle 2014

Managing Risk: Risk Mapping

Sovereign market risk

Example: Government of China decides to cap

numbers of students studying internationally to give

preference to the development of domestic provision

Challenges – How exposed are we to the China market (how reliant on

Chinese students)?

How much advance warning?

Will there be a list of approved programs? Are we well placed

(reputation and presence) to be on it?

Can we predict scale of income loss?

How do we go about mitigating this risk?

Examples of Risk approach

15

Managing RiskWhat type of risk?

Risk/Issue?

Potential impacts?

Triggers/warnings?

Impact VH/H/M/L (# or %)

Probability VH/H/M/L (# or %)

Risk Value

Monitoring Actions

Mitigating Actions

VH/L VH/M VH/H VH/VH

H/L H/M H/H H/VH

M/L M/M M/H M/VH

L/L L/M L/H L/VH

Imp

act

Probability/Likelihood

Managing Risk: Risk Mapping

Key # %

VH Very High 5 100

H High 4 80

M Medium 3 60

L Low 2 40

VL Very Low 1 20

Adapted from KPMG sources © Barton Carlyle 2014

Managing Risk: Market Research

Evidence for your strategy and implementation decisions:

18

• Global trends

• Competition drivers

• Calculate Market Share

• Potential

Markets

• Channel choice

• Support segmentation decisions

• Understanding student choice

• Retention

Channels

• Market choice

• Costs of recruitment

• Monitoring impact and ROI

• Branding

Strategy

Managing Risk: Market Research 19

SStrengths

WWeaknesses

OOpportunities

TThreats

Role of Market Intelligence

Managing Risk: Market Research 20In

tern

al

Strengths Weaknesses

Ext

ern

al

Opportunities Threats

21

ICEF/i-graduate Annual Agent Barometer

i-graduate Annual ISB (International Student

Barometer)

Managing Risk: Market Research

MARKET SCANNING

Managing Risk: Scenario Planning 23

Risk Strategy

Risk profile

Future proofing

Risk reporting

Risk Mitigation

Strategy delineates risk appetite

Positioning research and risk mapping generate risk profile

Scenario planning supports future orientation

Reporting supports active risk management

Mitigation actions diminish or eliminate possible impact of risks

Mitigation actions adjust strategy and support realignment of risk profile

24Scenario Planning“Scenario planning is not so much actively

predicting the future as it is about

understanding the…environment and the

nature of the risks that environment can

give rise to. Insights gained from

scenario planning should equip

organisations to recognize and respond to

significant emerging threats and

opportunities, and in the process building

enhanced…competitiveness, resilience

and agility”

KPMG Australia 2011 https://www.kpmg.com/AU/en/IssuesAndInsights/ArticlesPublications/Documents/Manage-the-future-through-scenario-planning-v3.pdf

25Scenarios: What if?

Sorting out market exit

26Scenarios: What if?

Fraud and security issues

27Scenarios: What if?

Reputational issues

28Scenario Planning

Map basic trends and driving forces

Find key uncertainties

Use important or critical and unpredictable driving forces

Distill to two forces/factors

Identify factor extremes and check for plausibility

Map these onto an x/y axis

Define scenarios and plot to grid

29Scenario Planning

Possible Topics

Disruption to possible student flows

Impacts of technology

Rise of market entrants and/or competitor disruption

Pathway provision impacts on ESL market?

Summary: Managing Risk Develop a risk management strategy:

Understand your institution’s risk appetite

Map your risk profile

Develop your risk register

Incorporate risk assessment in your international strategy

Use scenario planning to inform risk management

Mitigate risk – using market research for an active market

intelligence program

There are opportunity risks – estimate the risk of doing

nothing as much as you manage the risk of doing something!

Pamela Barrett, Director Barton CarlyleE: pamela@bartoncarlyle.comT: (44) 7788 600 388www.bartoncarlyle.com

THANKS

For your participation!