China is known for achieving change at an unprecedented speed and scale, and the realm of education is no exception. Total college enrollment surpassed the U.S. nearly a decade ago, and Chinese students are studying abroad in record numbers. Although universities seeking to expand into China’s education sector face many challenges (see Joint-Venture Universities in China, pg. 7), this boom nonetheless offers a wide range of opportunities.
Education consultancies have proliferated, offering young Chinese students college application assistance, test-taking programs and preparation for studying abroad. Meanwhile, many western universities – weary of high costs, low guarantees of enrollment and unclear policies in China – are choosing instead to stay at home and seek innovative new ways to draw these students to them. Beyond university education, executive training and professional skills providers are adapting to changing demands in China in an attempt to capitalize on emerging opportunities.
College prep on the rise
With a record 523,700 Chinese students studying abroad last year, a rapidly growing industry of college entrance preparation consultancies has arisen (see Journey to the West, pg. 18). Because acceptance into elite universities in China is based solely on a student’s score in the national gaokao examination that marks the end of high school, Chinese high school students are not accustomed to practices such as writing self-statement essays, preparing for western examinations like the SAT or GRE or incorporating extracurricular or personal experiences into their college applications.
“On the private industry side, I think it’s a very exciting time for the education space,” says Andrew Sohn of Due West, a Beijing-based education consulting company. When Due West opened in 2009, Chinese high school students were offered little assistance from their schools if they wanted to learn more about studying abroad. But according to Sohn, a huge shift has taken place in the past four to five years. Chinese high schools are increasingly opening international divisions which allow students to diverge from the traditional gaokao track and instead begin preparation for studying abroad. This has contributed greatly to the current wave of Chinese students overseas.
“As China has become more international, a desire from the student side as well as the family side for children to spend a certain amount of time outside of China to become more international and develop a more global view [has become increasingly important],” Sohn says, adding that this has opened up “an opportunity for creative and committed institutions to really be able to engage families.”
Staying at home
This surge of Chinese students studying in the U.S. has been a boon for many universities. Beginning in 2008, the growth rate of incoming Chinese students exceeded 20% for four consecutive years and has since remained above 10%. In the process, Chinese students have become far and away the largest foreign student body in America, growing to well over twice the size of second place India. Foreign students often pay two to three times the tuition rates of in-state students and thus contribute significant revenue streams to universities. Recent data shows that Chinese students now make up nearly one third of all foreign students in the U.S. and contribute US$9.8 billion a year to the economy. With this rapid influx of Chinese students, many U.S. universities have chosen to focus on maximizing gains from this aspect of China’s education boom rather than navigate the rocky waters of overseas expansion.
One such approach is underway at the University of California, Berkeley, which rather than build branch campuses abroad has chosen to create what Chancellor Nicholas Dirks has called “a new form of international hub.” Last year, Berkeley started development of a new 130-acre zone earmarked for a cluster of global centers consisting of partnerships with foreign universities. The goal is to bring global partners to Berkeley, rather than Berkeley going abroad. Describing this vision last year, Dirks said, “As other Western universities have developed branch campuses in places like Abu Dhabi, China and Singapore, they’ve faced persistent questions about whether they can uphold their commitments to academic freedom… At home we are on much more solid ground when it comes to protecting and supporting academic freedom, transparency, different forms of advocacy and political engagement, and protection of intellectual property.”
Opportunities for engaging China’s education boom are not just limited to standard university courses. Targeted skills acquisition and leadership training of senior management and executives is proving profitable for many institutions. Bruce Wiesner, associate dean of executive education at University of British Columbia’s Sauder School of Business, works extensively with Chinese participants in this capacity. Contrary to the trend of major North American universities opting to stay at home, Wiesner notes that an opposite trend is taking place with executive education.
“There are a lot of changes going on in China right now,” Wiesner says. “The last couple of years, what is more broadly called ‘austerity measures’ has affected the ability for Chinese organizations – especially state-owned enterprises – to send management groups overseas for training. So there is renewed interest in delivering training on the ground in China. The market is shifting.”
The increasing demand for such services, Wiesner says, has led many foreign business schools to consider establishing facilities in China. Pursuing this plan too vigorously, however, means that programs lose one of their key elements – the international focus. “You lose the ability to bring people out of their environment, expose them to new thoughts, new environments,” Wiesner says. “It’s really forcing us to rethink our delivery models. It’s a huge opportunity, but we’re going to have to be very market-focused.”
Engaging China’s education boom
The rapid growth of China’s education sector has given rise to a wide range of new opportunities. With the proliferation of online courses offering new modes of educational engagement and the rise of vocational schools (see Vocational Education: Answer to Talent Shortage, pg. 16) demonstrating another means of engaging China’s education boom, the aforementioned sectors only scratch the surface of the possibilities emerging in this realm.
For companies seeking to get involved in this burgeoning sector, opportunities abound. But it is important to remember that education in China is quite different from that of the West. Policies and attitudes toward education vary greatly, and Chinese students are often not seeking the same things as their Western counterparts. “Stay very customer and market-focused. Focus on what it is that the clients want to learn,” says UBC’s Wiesner. “Really understand their market, the challenges that they’re facing in a Chinese context, and not just simply export a North American point of view.”