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Examining the market entry strategies of a university's international expansion into a developing country
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Running head: EXAMINING MARKET ENTRY STRATEGIES 1
EXAMINING THE MARKET ENTRY STRATEGIES OF A UNIVERSITY’S
INTERNATIONAL EXPANSION INTO A DEVELOPING COUNTRY
by
Anthony Michael Lee
______________________________________________________________________________
A Dissertation Presented to the
FACULTY OF THE USC ROSSIER SCHOOL OF EDUCATION
UNIVERSITY OF SOUTHERN CALIFORNIA
In Partial Fulfillment of the
Requirements for the Degree
DOCTOR OF EDUCATION
December 2013
Copyright 2013 Anthony Michael Lee
EXAMINING MARKET ENTRY STRATEGIES 2
Acknowledgements
This dissertation is dedicated to my father, Dr. John Lee, who has truly been an
inspiration and role model to me my entire life. His unparalleled achievements in education and
business taught me the value of persistence, hard work, and determination. Graduating with a
doctorate degree would have never been possible without the love and support of my incredible
father and my wonderful family. I would like to thank my mother, Mrs. Marieanne Lee, my
sister Christianne, my brother Johnny, and my sister Teresa for their unwavering encouragement
in my educational pursuits.
I could not have survived this extraordinary endeavor without the guidance, thoughtful
advice, and mentorship of my dissertation co-chairs, Dr. Mark Power Robison and Dr. Michael
A. Diamond. I sincerely appreciate you challenging me, pushing me, and supporting me
throughout this learning process. I could not have achieved this special accomplishment without
your continuous support. Thank you to Dr. Guilbert Hentschke for agreeing to be the third
member of my dissertation committee and sharing your unique perspectives and educational
expertise.
Heartfelt thanks to my thematic dissertation group, Team R&D, for your ongoing
support, encouragement, motivation and inspiration. Reggie, Anne, Jenn, Martin, Job, Lauren,
and Sarah, it was an honor to share with you the peaks and valleys of the dissertation process.
We truly supported each other and became life-long friends. I'm also grateful to Katie Moulton
and Annalisa Zox-Weaver for their support. And special thanks to my first USC friend, Kelsey
Iino, who kept me positive throughout the program.
EXAMINING MARKET ENTRY STRATEGIES 3
I would like to express my sincere gratitude to my colleagues, Dean George Gliaudys, Jr.,
Dr. George Sayegh, and especially, Dr. John Ahn, who guided me through this arduous process.
Your wisdom and guidance kept me on the road to success. I’m very fortunate to have you as
my mentors.
Finally, this dissertation could not have been completed without the kind support of Dr.
David Wood and Curtin University. I would like to extend my warmest appreciation to Curtin
staff and faculty who so graciously gave of their time to participate in my research study.
Special thanks to Eileen Chan, who thoughtfully set up all 13 interviews, prior to my arrival. I
am grateful to everyone at Curtin University for accommodating my schedule and making my
trip to Perth, Australia a fascinating and memorable one.
EXAMINING MARKET ENTRY STRATEGIES 4
Table of Contents
Abstract 5
Chapter One: Overview Of The Study 6
Background of the Problem 7
Australia's Curtin University 13
SEAMEO RETRAC and SEAMEO RELC 15
Statement of the Problem 16
Purpose of the Study 17
Research Questions 18
Significance of the Study 19
Limitations of the Study 20
Organization of the Study 20
Chapter Two: Literature Review 21
Globalization and Internationalization of Higher Education 21
Higher Education Reform in Vietnam 27
Cross-border Ventures in Higher Education 33
Foreign Market Modes of Entry 37
Research Studies on Market Entry 40
Dunning’s OLI Eclectic Framework 45
International Ventures Outside of Education 46
Conclusion 48
Chapter Three: Research Methods 50
Research Design 52
Population and Sample 53
Interview Protocol 55
Data Collection and Analysis 56
Framework 57
Validity and Reliability 57
Conclusion 58
Chapter Four: Research Findings 60
Overview of Curtin University 62
Research Questions 68
Overarching Research Question 92
Chapter Five: Discussion 96
Summary 96
Research Questions 98
Discussion and Analysis of Curtin University’s Market Entry Strategy 101
Recommendations for Practice 106
Recommendations for Research 108
Conclusion 109
References 111
EXAMINING MARKET ENTRY STRATEGIES 5
Abstract
This study utilizes the OLI-Framework to examine the Ownership advantages, Location
advantages, and Internalization advantages that affect foreign market entry strategy. The
purpose of this study was to examine Curtin University’s market entry strategy for international
expansion into Vietnam through its offshore Master of Arts in Applied Linguistics Program.
Specifically, the study sought to determine the major factors shaping Curtin University’s market
entry strategies, including the competitive marketplace in Vietnam and the regulatory
environment of Vietnam’s higher education sector. This single case study employed qualitative
research techniques, in the form of interviews with Curtin University administrators and faculty
as well as document analysis, to gain a better understanding of the strategies Curtin University
used to set up its Master of Arts in Applied Linguistics Program in Vietnam. Findings from this
study revealed that Curtin University’s offshore strategy was to: recognize its internal strengths
and utilize them appropriately, target a country with an attractive local market on which it could
capitalize, and identify the major challenges in entering a new market and find ways to mitigate
them. Recommendations for universities considering the creation of offshore programs include
assessing their own capabilities, expertise, and capacity, aligning university mission and
objectives with proposed offshore program, facilitating buy-in from key staff members and
faculty toward internationalization efforts, implementing sufficient quality control processes to
protect their brand, and understanding the pivotal role of developing strategic alliances and key
relationships.
EXAMINING MARKET ENTRY STRATEGIES 6
CHAPTER ONE: OVERVIEW OF THE STUDY
The internationalization of higher education has brought more offshore educational
programs and international branch campuses to developing countries than ever. This growing
trend means that many higher education institutions from English-speaking countries are creating
offshore campuses or collaborating with local partner institutions to offer offshore programs.
When entering a new market, a university needs to consider the many factors that will shape its
decision-making process. These factors include what programs to offer, the type of students to
target, and the city or cities in which to launch a cross-border program.
Evaluating the factors for a new market is usually linked to the type of market entry
model being pursued and the approach being taken to the initial process of entry. Market entry
models include cross-border educational ventures such as an international branch campus,
offshore programs, local partnerships, twinning, and franchising. Unless a university plans to
establish a sole venture in the form of an international branch campus, an important way of
entering a new market is to establish a strategic alliance or joint venture with a local partner in
some kind of collaborative cross-border educational venture. With the growth in Western
universities looking to expand and establish educational programs in developing countries,
analyzing and learning from the decision-making process of a university that entered an
emerging market is important and valuable research. Although, several studies have been
conducted on the market entry process for schools establishing themselves in developing
countries, most of this research has focused on China. Vietnam—the country under study in this
project— differs vastly from China culturally, politically, and educationally. Perhaps most
significantly, the regulations for foreign institutions entering Vietnam are remarkably unlike
those of China. Virtually no research shows how to enter the higher education market of
EXAMINING MARKET ENTRY STRATEGIES 7
Vietnam. Without any data to rely on, universities interested in successfully entering Vietnam’s
emerging market face a formidable challenge.
This dissertation offers a case study of Curtin University, an Australian University in
Vietnam; research was conducted to understand the university's decision-making process related
to entering the market in Vietnam in order to offer an offshore Master of Arts in Applied
Linguistics program. Specifically, this research study investigates and analyzes the decision-
making process for entering a new market, choosing the appropriate local partner, engaging in
initial discussions with a partner, and negotiating the terms of the agreement for the strategic
alliance.
Background of the Problem
Globalization and Internationalization
Globalization is different from internationalization. Globalization refers to how the world
is getting “flat” and how many things—chief among them, technology—is bringing the far-
reaches of the world closer to each other. In higher education, globalization emphasizes the
economical, political, and societal forces that push schools toward more involvement overseas
(Altbach & Knight, 2007). These forces get stronger each year, as we witness the rising trend of
internationalization of higher education. Internalization refers to the international activities an
institution undertakes to increase its programs overseas or to add an international component to
its home campus (Altbach & Knight, 2011). Traditionally, most institutions engage in
internationalization through study-abroad programs, sending students to study in other countries
or recruiting international students to study at the home campus. More recently, many
institutions have expanded their international activities to include international branch campuses,
joint degree programs, offshore programs, twinning partnerships, and franchising programs. As
EXAMINING MARKET ENTRY STRATEGIES 8
mentioned previously, Western universities are rapidly expanding overseas and are doing a lot of
business in developing countries by offering these programs to local students. Globalization is
serving this effort: Technology plays a substantial role as whole classes or partial classes can be
delivered online, allowing that students and faculty to interact from anywhere in the world. In
addition, the World Trade Organization, which oversees the General Agreement on Trade in
Services, established parameters that made it easier for higher education to be delivered
internationally (Bashir, 2007). Since becoming a member of the World Trade Organization in
2007, Vietnam has become a more likely destination for offshore programs of Western
institutions.
Institutions engage in internationalization activities in several ways. Some institutions
establish an international branch campus in another country, an enterprise that requires
substantial resources on the part of the home institution because investments in facilities, faculty,
and regulatory requirements can be extensive. Many other institutions will choose to enter the
higher education market of a new country through a strategic alliance with a local institution.
Partnering with local institutions can reduce the fixed costs for a foreign institution, allowing it
to leverage the expertise and resources of the local institution. Foreign institutions are thus able
to utilize the facilities of the local institutions and use its direct experience and knowledge of
regulatory requirements and its intimate understanding of the target market. Strategic alliances
come in many forms, depending on the particular arrangement between the two institutions. A
joint degree or dual degree program can be offered, whereby students receive two degrees (from
the local and foreign institution) upon completion of the program. This type of arrangement
usually means that the faculty of both institutions will teach the program somewhat evenly.
Joint degree programs are not as common in developing countries, because the more respected
EXAMINING MARKET ENTRY STRATEGIES 9
Western degree is always more sought after. Usually strategic partnerships in developing
countries will award only the degree of the institution from the developed country—as is the case
for Curtin University Vietnam, which awards a Master of Arts in Applied Linguistics from
Curtin University to all of its graduates in Vietnam—the same degree awarded to its students in
Australia.
More common in developing countries like Vietnam, offshore programs are being offered
by the strategic partnership. The local institution will provide classroom facilities for the
program being offered by the foreign institution. Usually a mix of foreign faculty and local
faculty are hired to teach the program, and a revenue split is negotiated based on student tuition
fees. Usually the local institution manages all marketing and recruitment activities, while the
foreign institution supplies the curriculum and textbooks. This sort of arrangement is very
common among internalization activities of institutions from developed countries operating in
developing countries. Other arrangements include franchising, in which the foreign institution
solely supplies the curriculum to the local institution, and the local institution offers the program
by carrying out all classroom and administrative activities. This arrangement is not ideal for
foreign institutions, as it affords them very little control over how their curriculum is being
delivered and the type of student being admitted into the program. Another arrangement type is
called twinning, whereby the student can attend his or her first two years at a Vietnam institution
and last two years at a foreign institution and still receive the foreign bachelor's degree after four
years. This dissertation examines the strategic partnership between Curtin University and the
Southeast Asian Ministers of Education Organization, which offers its program entirely in
Vietnam. Curtin University offers an offshore Master of Arts in Applied Linguistics program in
EXAMINING MARKET ENTRY STRATEGIES 10
Ho Chi Minh City, but retains total control of curriculum, program structure, faculty hiring, and
the admissions process.
Motivations for Internationalization
Institutions of higher education have many motivations for engaging in a cross-border
venture. A university may want to increase its visibility on the stage of international education.
As such, this merger can play a major role in raising the brand awareness of a university in a new
market, which could lead to higher enrollment of international students at the home campus.
This effort can also support home students in studying abroad at host institutions, which educates
them to become knowledgeable global citizens (Armstrong, 2007). Another motivator is
additional revenue. Offshore educational programs are becoming a big business and can
generate substantial income for both foreign and local universities. For some institutions, like
Curtin University, the motivation was to establish a global footprint and enhance its international
reputation (Our Future in Focus, 2009). The demand for a Western education such as Curtin's
MA Linguistics Program is very high all over the world, especially where higher education is in
short supply, as in developing countries (Altbach & Knight, 2011).
Students in developing countries act as “buyers” of education, whereas institutions in
developed countries act as “sellers.” This transactional relationship occurs for several reasons.
Most often, developing countries simply do not have enough colleges and universities to serve
their population of local high school graduates who want to pursue higher education. This gap is
what foreign universities fill, engaging in various strategic alliances to offer educational
programs in developing countries. Strategic alliances increase the supply of education to meet
the demand of local students and/or perhaps students from the region, as in the case in Singapore.
Singapore serves its own local students but also many from the Southeast Asia region who study
EXAMINING MARKET ENTRY STRATEGIES 11
abroad there. In such arrangements, international higher education becomes a commodity being
bought and sold by local students and foreign institutions (Altbach & Knight, 2007).
Higher Education in Vietnam
Vietnam's economy has experienced rapid growth for the last several years. The
population of Vietnam is 85 million people. In 1986 the Vietnamese government implemented a
sweeping economic reform called “Doi Moi,” which also included a major education reform for
the country. The ruling Communist party of Vietnam replaced the traditional closed government
structure to a free market economy, which is mainly responsible for the economic growth of
Vietnam over the last 25 years (Harman, Hayden, & Nghi, 2010).
The Ministry of Education and Training (MOET) is the main regulatory body that
oversees the higher education sector in Vietnam. All educational institutions must abide by the
rules and regulations set forth by MOET. Private institutions, in particular, must comply with
admission quotas, curriculum frameworks, and maximum tuition fee ceilings set by MOET
(Harman et al., 2010).
In 1993, the Vietnamese government restructured its traditional higher education system
by establishing a system of large universities, completely abolishing the Communist system of
smaller, specialized colleges for higher education (Harman et al., 2010). One of the goals was to
transform the small entities into large research-oriented universities. Along with this change
came the establishment of nonpublic institutions that allowed private owners of institutions to
enter the higher education system. From 1993 to 2007, the enrollment of students in higher
education in Vietnam grew from 2% to 13% of the college-age population (Harman et al., 2010).
In 1998, the government designated that higher education programs could be offered at a
university or college. They also officially designated institutions that only awarded associate
EXAMINING MARKET ENTRY STRATEGIES 12
degrees as colleges. Universities would be institutions that awarded bachelor’s degrees or
higher. In 2001, a new classification was implemented that defined a community college as a site
that offers vocational training and more formally established the ability to articulate to
universities. Then, in 2004, the government selected 14 universities and defined them as the
major higher education institutions in Vietnam.
The Higher Education Reform Agenda, adopted in 2005 by the Vietnamese government,
pushed for significant expansion of the higher education system by the year 2020. The Agenda
called for an increase in serving the college age group from 13% to 45% as well as requiring a
rise in the percentage of academic staff with doctoral degrees from 15 to 35 by 2020 (Hayden &
Thiep, 2007). The Agenda mandated that research-oriented institutions account for at least 20%
of all institutions and that significant expansion occur in the nonpublic (private) sector—to 40%
up from 13%—by 2020 (Hayden & Thiep, 2007). The Agenda indicates the urgency that the
Vietnamese government began to place on increasing higher education—importantly, for our
purposes, by drastically increasing the presence of private institutions. For foreign universities
interested in developing an overseas market, the educational reform in Vietnam provided an
opportunity to tap into an emerging market in Asia.
In 2007, Vietnam was officially recognized by the World Trade Organization, which
helped the country integrate economically and culturally with many other countries (Welch,
2010). Being part of the World Trade Organization opened up the education sector in Vietnam,
making it easier for foreign universities to offer offshore educational programs there.
The predominant mode of entry for foreign universities’ cross-border ventures in
Vietnam has been a joint partnership arrangement between a foreign university and a local
university. Vietnam has only one truly international branch campus, RMIT of Australia. RMIT
EXAMINING MARKET ENTRY STRATEGIES 13
Vietnam started enrolling student in 2001 in Ho Chi Minh City and subsequently opened a
second campus in Hanoi (Welch, 2010). Twinning arrangements have been in place in Vietnam
since 1994. Twinning authorizes a foreign university to offer an approved curriculum for the
first two years of a bachelor’s program, after which students are required to take the last two
years at the home institution (Altbach & Knight, 2011). One such arrangement is between the
Institute of Social Studies in Hague, Netherlands, with two universities in Vietnam called Hanoi
Economics and Ho Chi Minh Economics University (Fry, 2009). There are also Vietnam-
Belgian Masters programs in place in Hanoi and Ho Chi Minh City. Hanoi University of
Technology offers programs from a variety of countries such as France, Germany, and Singapore
(Fry, 2009). All of these examples signal the increasing trend of foreign institutions entering
Vietnam’s higher education market.
Australia's Curtin University
Curtin University (CU) School of Education first entered Vietnam’s higher education
market in 2006, partnering with a local educational organization to offer an offshore program in
which the degree is awarded solely by CU. Curtin University partnered specifically with the
Southeast Asian Ministers of Education Organization Regional Training Center (SEAMEO
RETRAC) to offer a Master of Arts in Applied Linguistics program in Ho Chi Minh City,
Vietnam. On August 13, 2012, the eighth cohort of students from this program celebrated its
graduation ceremonies. Seventy-one English teachers from Vietnam and the U.S. graduated in
this cohort. Moving forward, the program aims to have two annual cohorts of no more than 40
students per cohort. In total, 423 students have graduated from this program jointly provided by
CU and SEAMEO ("Graduation Ceremony of the Master," 2013).
EXAMINING MARKET ENTRY STRATEGIES 14
Curtin University's internationalization effort in Vietnam is part of a larger global
strategy led by the senior leaders of CU, who place great emphasis on expanding the
international brand of CU worldwide, particularly in the Asia region. With regard to offshore
activities, Curtin's internationalization efforts began in 1986 when a twinning program was
initiated in Singapore. Curtin University currently has three branch campuses outside of Perth,
Australia, where the main campus is located. One branch campus is located in Sydney and two
international branch campuses are in Malaysia and Singapore, respectively. The campus in
Malaysia has the highest enrollment of any branch campus, at 2,114 students. This campus first
opened in 1999 in Sarawak, Malaysia. In addition, CU offers offshore educational programs in
11 countries through 25 active partners (Performance Portfolio, 2008). In 2007, 6,488 students
were enrolled in offshore educational programs offered by CU (Performance Portfolio, 2008).
Curtin University's School of Education program in Vietnam is the only offshore program that
allows students to obtain a Master of Arts in Applied Linguistics degree outside of Australia.
Classes for CU Vietnam are offered through a blended format, whereby curriculum
delivery takes place in person and online. The course takes 12 months to complete and is
delivered in person through four workshops held throughout the year. Classes are taught jointly
by Curtin and SEAMEO faculty members. The program targets mainly English teachers
currently teaching in Vietnam. Because the unique blended format allows the majority of the
coursework to be completed online, students can maintain full-time jobs for the duration of the
program. The tuition for the program in Vietnam is $5,600 USD, which is far less expensive
than the $25,000 USD it would cost to study the same program in Australia. The majority of
students enrolled in the program are local nationals with a small population of expatriates.
EXAMINING MARKET ENTRY STRATEGIES 15
SEAMEO RETRAC and SEAMEO RELC
In its partnership with Curtin University, SEAMEO played a vital role in implementing
the market entry process into Vietnam. SEAMEO is not a university, but, as its website explains,
“a regional intergovernmental organization established in 1965 among governments of Southeast
Asian countries to promote regional cooperation in education, science and culture” (Southeast
Asian Ministers, 2013). SEAMEO has 20 regional centers located across 11 Southeast Asian
countries (Brunei Darussalam, Cambodia, Indonesia, Lao People's Democratic Republic,
Malaysia, Myanmar, the Philippines, Singapore, Thailand, Timor-Leste and Vietnam). Two of
these regional centers were involved in Curtin’s original agreement to offer its Master of Arts in
Applied Linguistics in Vietnam; the SEAMEO Regional Training Center (RETRAC) in Vietnam
and the SEAMEO Regional Language Center (RELC) in Singapore. RETRAC specializes in
educational management, offering language training and teacher training courses and workshops
“serving all SEAMEO Member Countries and enhancing international cooperation and
partnership” (Southeast Asian Ministers, 2013). For its part, RELC supports language teacher
education in partner countries. Together, SEAMEO RELC “provides leadership in the
development of expertise and excellence in the field of language education and promotes
cooperation between and contact among language professionals in the region and beyond”
(Southeast Asian Ministers, 2013).
When its program was established in 2006, Curtin University had partnered with both
RETRAC and RELC through a tripartite agreement. In 2010, RELC left the partnership. At that
time, the arrangement transformed into a bilateral arrangement in which Curtin University and
RETRAC jointly operated the Master of Arts in Applied Linguistics program.
EXAMINING MARKET ENTRY STRATEGIES 16
Statement of the Problem
With the influx of offshore educational programs in developing countries in recent years,
analyzing and learning from the decision-making process of an institution entering a new
emerging market like Vietnam is crucial. Several studies have traced the complex steps an
institution goes through when entering a similar developing country like China (Willis, 2006).
For example, a three-stage process for initial market entry in China was created by Willis (2006),
whose study looked at how institutions evaluate the processes they use to determine how to enter
the Chinese market. Another study looked at similar processes undertaken by foreign institutions
seeking entry into the market in Hong Kong (Willis, 2003). However, no studies have looked
specifically at the market entry process for Vietnam, which differs culturally and politically from
China and Hong Kong.
The Ministry of Education and Training in Vietnam recently established unique
regulations for foreign providers of education, which may greatly impact market entry strategies
for universities from other countries. Previous studies (Willis, 2003, 2006) looked carefully at
how an institution evaluates potential institutions with which to partner. Foreign institutions
looking to enter a new market may face formidable challenges determining even what decisions
need to be made, with numerous variables relating to partner institutions in a local country, such
as location, size, and programs. A foreign institution also must consider the partner school’s
reputation as well as its own. There are pros and cons of partnering with institutions that may
view the foreign university as the more reputable of the two. Some educational institutions may
want to partner only with institutions of comparable size and reputation so that both schools will
view the alliance as one between equal partners. With so many factors in the decision-making
EXAMINING MARKET ENTRY STRATEGIES 17
process for entering a new market, the initial strategy will impact whether the international
venture is a success or failure for the foreign institution.
International market entry models in higher education usually involve sole ventures like
international branch campuses or joint ventures with local institutions. Several factors determine
the entry strategy into a new market. In a country like Vietnam, the more popular route is to
work through a local partner and figure out what entry model to utilize. When forming the
agreement for the strategic partnership, an institution has many options to consider—among
them are franchising, twinning, or joint degree programs. The foreign institution must evaluate
which type of agreement and level of cooperation it wants with the local institution. Whatever
arrangement is decided upon, the foreign institution must ensure it has the necessary resources to
support the strategic partnership. To ensure the success of an international venture in a
developing country, a foreign institution needs to be prepared to make informed decisions about
selecting an appropriate partner, the program or programs to be offered, and the negotiations for
the initial agreement with the local partner.
Purpose of the Study
The purpose of this study was to closely examine the market entry process of an
institution that entered Vietnam's higher education sector. The goal was to identify key factors
that influenced market entry strategy and to understand the reasoning behind the decision-
making process of senior leaders of an institution entering Vietnam.
This single case study of a Western university utilized qualitative research techniques to
gain perspective on the market entry strategies of the senior leaders of the institution. This study
examined the decision-making process behind the market entry strategy of the home institution,
considering factors that impacted the type of market entry model the university chose and why.
EXAMINING MARKET ENTRY STRATEGIES 18
Research included close study of local regulatory requirements, the growth potential of the
market, and investment risks associated with Vietnam—all of which can affect whether a
university chooses to open an international branch campus or to partner with a local institution to
offer a joint program. This study also looked at specific factors that impacted the selection of a
prospective partner. Close attention was paid to major issues surrounding the partner negotiation
that arose during the process and how those issues were resolved. Major external concerns that
were explored included the regulatory environment and the competitive marketplace and its
effects on market entry strategy.
More specifically, this study examined how CU itself carefully studied the market of the
developing country of Vietnam before attempting to enter through an offshore program. Factors
CU considered included size, location, reputation, and resource capabilities of the local partner.
Research was gathered to assess whether Curtin University utilized a complex decision-making
process and how that might have shaped its approach to evaluating a prospective local partner
and engaging in initial discussions to form a strategic alliance. In addition, the study examined
how Curtin University valued relationships with the local institution and how negotiations
transpired that may have addressed critical issues such as revenue share and program structure.
Data from the study shed light on the specific factors that shaped the market entry process of CU
Vietnam and its ability to navigate those factors and implement a successful plan.
Research Questions
Overarching Question:
What was Curtin University's market entry strategy for expanding into Vietnam, and how was it
implemented?
EXAMINING MARKET ENTRY STRATEGIES 19
Sub-Questions:
1. What factors shaped Curtin University's market entry strategies for expanding into
Vietnam?
2. How did the competitive marketplace in Vietnam affect the market entry strategies of
Curtin University?
3. How did the regulatory environment of Vietnam's higher education sector affect the
market entry strategies of Curtin University?
Significance of the Study
As more universities engage in internationalization efforts as part of their global strategy
and to expand their program offerings, understanding how to successfully implement and sustain
an offshore education program in another country is becoming increasingly important. The first
step in offering an offshore program is to evaluate and implement an appropriate market entry
strategy. Several studies have looked at market entry in China and Hong Kong, but this study
will specifically examine the market entry process for Vietnam. Understanding the process an
institution implements to enter an emerging market will help future foreign institutions recognize
and be better prepared to deal with the myriad factors involved in entering a foreign higher
education market, particularly in Vietnam. For institutions considering an international venture
in the higher education sector of Vietnam, the findings of this study can serve as a guide in the
market entry process.
The goal of this research is to identify key factors that influence market entry strategy
and to parse out the reasoning behind the decision-making process of the senior leaders of an
institution entering Vietnam. By explaining the rationale behind the steps CU took in the market
entry process, hopefully the research will serve as best practices for other universities looking to
EXAMINING MARKET ENTRY STRATEGIES 20
internationalize in Vietnam. Given that limited research exists on market entry into Vietnam by
foreign institutions of higher learning, this study is of consequence to the financial and
educational futures of both foreign and local institutions in Vietnam.
Limitations of the Study
This study is limited in having researched only one program in one country. It is specific
to one institution that chose to enter the market of Vietnam and thus may not apply to other
institutions interested in entering the educational market of other countries. In addition, as
discussed above several types of institutions exist with which to partner and several levels of
cooperation can take place with local institutions. This study examined a market entry process
focused on developing a partnership with one local educational institution in Vietnam. The scope
of this study is limited to examining the initial process of market entry and does not include the
viability and success of the decisions made by the foreign institution.
Organization of the Study
Chapter Two will review the literature on international ventures in higher education,
looking particularly at the market entry process in developing countries. A business framework
utilized for the education sector will be closely examined, as it will serve as a lens for the
research study that follows. Chapter Three will discuss the methodology for the study. Chapter
Four presents the results of the study. And, finally, Chapter Five will reflect upon the study,
elucidate best practices drawn from the data, and offer recommendations for future study of
foreign market entry in higher education.
EXAMINING MARKET ENTRY STRATEGIES 21
CHAPTER TWO: LITERATURE REVIEW
This study focused on the implementation of an offshore educational program in the
developing country of Vietnam. This chapter will discuss and analyze the key literature
concerning the internationalization of higher education as well as the factors involved and the
motivations behind the recent rise in internalization activities in education. The efforts of
educational institutions to work across national borders have evolved dramatically in recent
years, indicating globalization’s reach beyond the business sector. This literature review will
look at internationalization activities in Southeast Asia, and review the literature on different
types of offshore programs in which universities become involved and the reasons why specific
structures are chosen over others in particular cases.
Examining the literature on the market entry of internationalization activities in the
higher education sector in Asia will provide a context for examining Curtin University's offshore
educational program in Vietnam. The benefits and challenges to implementing offshore
programs in developing countries will be also analyzed and discussed. Then, the literature
regarding foreign market entry models will be reviewed. Next, an in-depth exploration will focus
on the higher education sector in Vietnam to study major trends that have arisen in recent years,
including the influx of private providers of higher education. This case study of an offshore
Master of Arts in Applied Linguistics program in the developing country of Vietnam seeks to
add to the existing literature on the market entry aspect of internationalizing higher education.
Globalization and Internationalization of Higher Education
Globalization has affected a range of industries, bringing worldwide political,
technological, and economic forces closer together. As such, countries have come to depend on
each other to generate more proficient operations, share more ideas and resources, and
EXAMINING MARKET ENTRY STRATEGIES 22
collaborate on serving new market segments more effectively. These forces have typically
affected other industries more than in higher education. According to Altbach and Knight (2011),
Bashir (2007), and Huang (2007), the trend is now moving toward education and other service
sectors, and globalization is drawing higher education into more international activities than ever
before.
While other industries typically go through globalization by optimizing production and
distribution, higher education has resembled a more classic hub and spoke model (Armstrong,
2007). This format has meant that most institutions send their students and faculty abroad to
study and do research, then students and faculty would return to their home institutions with new
knowledge to contribute. Breaking from traditional study abroad programs, globalization has
helped spur new trends in the internationalization of higher education.
However, as an alternative to a classic hub model focused on offering all educational
programs only at the home campus, implementing and offering offshore programs has increased
in recent years (Bashir, 2007). Several reasons explain this sea change, including the desire to
increase brand image internationally as well as to add a revenue stream to the home institution
(Bashir, 2007; Knight, 2008). Internationalization activities of higher educational institutions
now include many offshore activities such as twinning, franchising, international branch
campuses, joint programs, and offshore programs (Altbach & Knight, 2011). Twinning involves
authorizing a foreign university to offer approved curriculum for the first two years of a
bachelor’s program but requiring the students to take the last two years of course work at the
home institution (Altbach & Knight, 2011). This arrangement offers significant incentives for
foreign students in terms of the convenience of studying for shorter periods abroad and financial
savings.
EXAMINING MARKET ENTRY STRATEGIES 23
According to Altbach and Knight (2011), franchising offers even more convenience and
financial saving to students seeking to obtain a degree from a foreign institution. Franchised
programs use the curriculum and textbooks of the home institution, but teach students entirely in
the host country, usually with local faculty members (Armstrong, 2007). Altbach and Knight
(2007) have noted that the foreign institution typically has final authority on grades and
evaluations but that program delivery is typically the responsibility of the host institution. This
particular arrangement allows local students to obtain a foreign degree at a much lower cost by
never leaving their own country. However, franchised programs are usually of lesser quality due
to several factors, including insufficient oversight by foreign institutions and a low level of direct
engagement with foreign faculty in teaching and interacting with students (Umemiya, 2008).
In recent years international branch campuses have increased substantially in number. As
of December 31, 2011, two hundred international branch campuses were in operation around the
world—a sharp increase from recent years (Observatory on Borderless Higher Education,
2012). International branch campuses are projected to continue growing and reach more than
240 by 2014 (Observatory on Borderless Higher Education, 2012). These findings point to a
growing trend in which most branch campuses are moving to emulate the quality of instruction
and curriculum delivery as their home campuses (Altbach, 2004). This tendency means that
many professors from the home country will teach classes offered at the branch campus. Indeed,
often programs being offered at the branch campus are very similar to those being delivered at
the home campus (Armstrong, 2007). This model usually offers the best option for students who
want to obtain a foreign degree but still live in their own country. Accordingly to Wilkins and
Huisman, (2012), programs at international branch campuses can be quite costly but are still
rather inexpensive compared to traveling abroad to study. Similarly, foreign universities offer
EXAMINING MARKET ENTRY STRATEGIES 24
basic offshore programs in a local country. In contrast to international branch campuses,
offshore programs have minimal facilities and usually consist mainly of classrooms to teach the
courses (Knight, 2006). These offshore programs may also take the form of a joint program in
which a foreign university partners with a local institution. Usually local partners will provide
the facilities, conduct the marketing and recruitment efforts, and offer student support services,
whereas the foreign partner provides the curriculum, textbooks, and instructors to teach the
program (Armstrong, 2007). By sharing resources and expertise, both institutions can benefit by
focusing on utilizing the strengths of each partner.
Curtin University offers an offshore program in Vietnam through partnership with a local
intergovernmental organization called Southeast Asian Ministers of Education Organization
(SEAMEO) in Ho Chi Minh City. CU has full oversight over admissions and curriculum. The
arrangement is that CU uses the facilities of the local partner, and curriculum is delivered by
both CU faculty members flown in from abroad to teach and local SEAMEO faculty members.
Internationalization in Southeast Asia
Huang (2007) has reported that strategic partnerships between foreign institutions and
local institutions are the most common types of internationalization activities in Southeast
Asia. In 2010, Huang (2010) observed that although they are on the rise, international branch
campuses still represent a small percentage of all offshore programs being offered in this
region. Southeast Asia is a prime target for international ventures by foreign institutions because
many developing countries in this part of the world have a high demand for Western education,
according to Chan (2004). Chan (2004) observed that institutions in developed countries such as
the United States and United Kingdom offer academic programs that are highly sought after all
over the world, especially in such countries like Vietnam and China. Institutions in developed
EXAMINING MARKET ENTRY STRATEGIES 25
countries are usually the “sellers” of education, whereas institutions in developing countries are
the “buyers” (Altbach, 2007). The lack of Western education in developing countries opens up a
market for institutions in developed countries to sell their programs to local institutions, which
buy them to fill that need and to offer offshore programs to local students. Local students are
thus able to access Western education from a foreign university without having to leave their
own country.
Countries in the Asia Pacific Region commonly “import” educational programs from
other countries. Importing countries with a significant internationalization activities from
Western institutions include Vietnam, Malaysia, China, Singapore, Thailand, and
India. Countries that export to Asia the most are the United States, United Kingdom, Australia,
and Canada. In addition to being an importer of Western education, Singapore acts as an
exporter of education in this region. The majority of international branch campuses are in China
and Singapore ("International Branch Campuses," 2012), with the latter having several
campuses, including one at the University of Nevada, Las Vegas, which opened up a branch
campus in 2007. China has several partnerships with universities in Belgium, Singapore, and
the United States. Troy State University has an offshore MBA program in Bangkok,
Thailand. In Vietnam, RMIT of Australia has a branch campus that serves over 5,000 students
(Altbach, 2007). In addition, Vietnam has many partnerships between local institutions and
foreign institutions from countries like France, Germany, United Kingdom, and the United States
(Welch, 2010).
This increase in internationalization activities—particularly in Southeast Asia—makes
understanding the market entry process of institutions looking to establish operations in this part
of the world both valuable and exigent. Understanding the steps taken by Western universities
EXAMINING MARKET ENTRY STRATEGIES 26
entering developing countries, such as Vietnam, will make these cross-border ventures more
successful in the future.
Internationalization of Australian Universities
Because this research study focused on Curtin University of Australia, insight into the
internationalization trends of Australian universities—which are quite aggressive when it comes
to offering offshore programs—is crucial. Australia has been a leader in the internationalization
of higher education because cross-border education is a primary focus of most Australian
Universities (McBurnie, 2000). Specifically, thirty-seven Australian universities offer 1,569
offshore programs in over 20 countries (IDP Education Australia, 2008). Over 94,000 students
study in the offshore programs of Australian universities, with the majority in Malaysia,
Singapore, and China (IDP Education Australia, 2008). And the numbers have increased
dramatically over the last 15 years. From 1996 to 2004, the number of students studying in
offshore program of Australian universities has seen a four-fold increase (Ziguras & McBurnie,
2011).
Australian universities have targeted Asia for offshore programs, with over 95% of them
established in this region (IDP Education Australia, 2008). Malaysia and Singapore are the top
two countries importing Australian offshore programs, primarily because their governments have
pushed for Western institutions to set up offshore programs and international branch campuses
there since the late 1990s (Mazzarol, Soutar, & Seng, 2003). Monash University of Australia
and Curtin University both have international branch campuses in Malaysia. Curtin University
also has a branch campus set up in Singapore. As mentioned in Chapter One, Curtin
University—the largest university in Western Australia—places a heavy emphasis on offering
offshore programs. Monash University of Australia shares this internalization mission, as
EXAMINING MARKET ENTRY STRATEGIES 27
evidenced by its aim to double its student numbers through its network of overseas locations by
2020 (McBurnie, 2000). Monash University is one of the largest universities in Australia, with
over 40,000 students enrolled. Both Monash and Curtin enroll a large number of students
through offshore programs in Asia.
Curtin University's branch campus in Malaysia was set up in 1999 in collaboration with
the local government, which is a common arrangement in the implementation of international
branch campuses (Lane, 2011). Similarly, the government of Vietnam was highly instrumental in
the set up of RMIT's branch campus in Ho Chi Minh City (Hayden & Thiep, 2010).
Governments of these countries do not have the capacity to meet the demand for higher
education and thus are eager for Western universities to meet this need. Educating the population
serves to strengthen the future workforce (Altbach, 2011). Vietnam has followed the lead of
Malaysia and Singapore by putting regulations in place with the hope of facilitating the entry of
more Western universities seeking to offer offshore programs.
Higher Education Reform in Vietnam
To fully understand the market entry process of CU Vietnam, tone must first examine the
higher education landscape in Vietnam. The higher education sector in Vietnam has been
evolving for over 25 years, with the most recent development being that more and more foreign
higher educational institutions are establishing a presence there. The increase in
internationalization activities by foreign institutions in this emerging market indicates the desire
to capitalize on the rapidly growing economy in Vietnam, especially with its less restrictive
government regulations established in recent years (Harman, Hayden, & Nghi, 2010). Although
many restrictions still exist on foreign providers of education entering Vietnam, the climate is
EXAMINING MARKET ENTRY STRATEGIES 28
dramatically different than 5 years ago, let alone 27 years ago, in 1985 when no foreign
providers were allowed into the country.
Educational Reform first began in 1986 during "Doi Moi," which translates to "economic
renovation." Vietnam finally opened up its restrictive economy 11 years after the end of the
Vietnam War, in 1975 (George, 2010). This turning point pushed Vietnam toward a more free
market economy, allowing the country to grow economically through free trade with other
countries. During this time, the government began the process of allowing more privatization in
several sectors, including education, and the regulatory environment lessened considerably with
regard to foreign investment (Harman et al., 2010). As the government of Vietnam began to
focus more on its economic growth, improving higher education became a priority. The
government began to see higher education as the foundation to support economic development
and international trade (Hayden & Thiep, 2010). Reforming higher education in Vietnam
involved increasing access for all students through the development of more universities. The
government saw providing a Western education and curriculum as necessary to growth.
In 2005, Vietnam announced a comprehensive plan for the future of higher education in
through the Higher Education Reform Agenda, which outlined massive educational goals to be
accomplished by 2020 (Hayden & Thiep, 2010; Reddy, 2012). This plan includes increasing the
enrollment in higher education to 45% by 2020—a 200% increase in 15 years (Hayden & Thiep,
2010). It also calls for at least 20% of students to be enrolled in selective research-oriented
institutions, with the remaining students attending professional and vocational-type schools. The
Agenda further outlines the need to increase research and development activities of all higher
educational institutions, to reach 25% of overall institutional revenue streams (Hayden & Thiep,
2010). This task is substantial, considering research and development activities currently only
EXAMINING MARKET ENTRY STRATEGIES 29
amount to 2% of revenue. The Higher Education Reform Agenda also wanted to see the number
of qualified faculty holding doctorate degrees double—from 15% to 35% (Hayden & Thiep,
2010) and aimed to reduce the faculty-to-student ratio from 1 to 30 to 1 to 20 to provide more
faculty support to individual students. To reach many of these goals, the Vietnamese government
knew that the private higher education sector needed to be expanded, so part of the Reform
Agenda called for dramatically increasing the private sector of higher education. It
recommended that private universities should enroll at least 40% of all college students by 2020
(Hayden & Thiep, 2010), a sharp increase from the 2010 figure of 13% enrollment by "non-
public" universities. To encourage the privatization of higher education further, the Reform
Agenda called for regulations that would encourage more foreign investment into the higher
education sector in Vietnam (Fry & Huong, 2002). This effort involved revising the current
governance of higher education into one allowing institutions more freedom in curriculum
development, human resources, budgeting, and so forth. In addition, the internationalization of
higher education was a priority (Oliver, Thanh, Elsner, & Phuong, 2009; Reddy, 2012).
Developing a system that enabled more international activities by institutions and improved the
quality of English language education was paramount.
The Higher Education Reform Agenda was a major step in advancing the higher
education sector in Vietnam. According to Hayden and Thiep (2010) and Fry (2009), it
prioritized improving the quality of Vietnam’s universities and colleges, providing more access
to higher education to a greater percent of its population, training its students to be competitive
in a global economy. The Reform Agenda placed a high value on the university's role in
research and development and innovation, and in forging stronger connections to the business
community. Because a lack of resources by the government presented a clear impediment to
EXAMINING MARKET ENTRY STRATEGIES 30
accomplishing its overarching economic goals, the marketization and privatization of higher
education were seen as part of the solution for facilitating growth (Harman et al., 2010). Market
forces push for more private institutions to be established, whether local or foreign, thus
providing greater access to higher education. Competition and an influx of foreign providers
increase the quality of education in order to be competitive with other countries (Harman et al.,
2010). Clearly, this Reform Agenda was a major change that increased the ease with which
foreign institutions could enter the higher education market of Vietnam.
In 2009, the World Bank reported that along with the government of Vietnam's
aspirations in higher education through the Higher Education Reform Agenda, its membership
into the World Trade Organization (WTO) in 2007 had greatly influenced the ability of foreign
providers of education to enter its emerging economy. Knight (2010) has asserted that Vietnam's
desire is to integrate its economy with the rest of the world through its WTO involvement.
According to Knight (2010), this effort of integration by Vietnamese government would allow a
higher level of collaboration between Vietnam and other countries in the area of higher
education. As a WTO member, Vietnam is now bound by the General Agreement on Trade in
Services (GATS) and the provisions that affect Vietnam Higher Education (Knight, 2010). As
Knight pointed out, the goal of GATS is to remove barriers to trade and to promote easier
collaboration between countries (Knight, 2006). As a result, Jie (2010) has concluded, clear
policies and regulations for foreign collaboration help senior leaders of higher educational
institutions make better-informed decisions.
Ministry of Education and Training
Hayden and Thiep (2010) have reported that the policies and regulations of the higher
education sector in Vietnam are governed mainly by the Ministry of Education and Training
EXAMINING MARKET ENTRY STRATEGIES 31
(MOET), which oversees requirements for program structure, curriculum, faculty, and so on.
The Ministry of Finance and the Ministry of Planning and Investment also govern different
aspects of educational institutions (Fry, 2009). The Ministry of Planning and Investment is
important for foreign institutions because it oversees authorization of foreign direct investment,
which may be necessary for foreign universities planning to offer offshore programs in Vietnam.
Although MOET oversees the overall educational system of Vietnam—public and private—two
universities are exempt. The only two national universities, Vietnam National University in
Hanoi and Vietnam National University in Ho Chi Minh, are governed directly by the Prime
Minister's Office (Hayden & Thiep, 2010).
Given their exempt status from MOET, these two national universities have more
freedom when it comes to academic and financial decisions. This status is significant, according
to Hayden and Thiep (2010), because foreign institutions may find it advantageous to partner
with Vietnam National University, if possible, because of its unique exempt status. According to
Fry (2010), MOET has stricter guidelines compared to those of the Prime Minister's Office,
particularly with regard to curriculum, faculty qualifications, new program approvals, and so on,
because MOET oversees national standards for the majority of schools in Vietnam. Vietnam
National University is allowed some flexibility because the decisions made by the Prime
Minister's Office regarding education affect a smaller number of schools (Hayden & Thiep,
2010).
According to Welch (2010), only one 100% foreign-owned educational venture exists in
Vietnam—the international branch campus set up in 2001 by the Royal Melbourne Institute of
Technology (RMIT) of Australia. The first campus by RMIT was established in Ho Chi Minh
City; then, in 2004, a campus in Hanoi was built. RMIT offers undergraduate and graduate
EXAMINING MARKET ENTRY STRATEGIES 32
programs and recently went through a new renovation of 20 million dollars (Fry, 2009). RMIT
has a newly built campus in Ho Chi Minh City that serves 7,000 students and even has a
dormitory to house students from distant cities who move there to study. RMIT is the biggest
branch campus of any foreign educational institution in Vietnam. According to Fraser (2009), the
majority of foreign universities that operate in Vietnam are joint ventures with local universities;
these include the University of Hawaii, Curtin University, Griggs University, Troy State
University, University of Technology in Sydney, and Toulon University of France. Fry (2009)
noted that one of the most popular joint programs involves Harvard University, which offers a
graduate program in Public Policy in conjunction with the University of Economics of Ho Chi
Minh City.
In addition to increasing the capacity for higher education in the country, Welch (2010)
has pointed out, Vietnam was motivated to encourage international ventures like CU Vietnam to
foster international relations with more developed countries, to extend the government's effort to
opening up the education sector to foreign investment, and to improve training of its future
workforce. In this regard, Welch (2010) and Fry (2009) also argued that international branch
campuses are uniquely positioned to meet the needs of both the Vietnamese government and the
emerging higher education market in Vietnam. Understanding the higher education landscape in
Vietnam provides a context for the decisions made by the senior leaders of CU Vietnam. The
regulatory environment has a tremendous impact on the market entry strategy of any university
entering Vietnam.
EXAMINING MARKET ENTRY STRATEGIES 33
Cross-border Ventures in Higher Education
Rationale
To understand the specific case of the market entry process of CU Vietnam, one must
understand the larger rationale behind these cross-border educational ventures. Many
researchers have cited the benefits and reasons for offering educational programs abroad.
Naidoo (2009) found that collaboration between two countries in a joint educational venture
usually strengthened political ties between the partnering countries. DeWit (2002) echoed this
finding, noting that the internationalization activities of foreign institutions improves foreign
policy and international relations, leading to safer standards for national security. Another benefit
is an increase in the labor force through the education of increasingly skilled workers that are
able to contribute to the local economy after graduation (Naidoo, 2009). The enhanced labor
market from offshore programs is a tremendous benefit to host countries (DeWit, 2002).
A more commonly cited benefit of cross-border ventures is the motivation to increase
revenues through higher education expansion. The financial advantages for an institution
engaged in internationalization activities is a major driver for foreign institutions (Altbach &
Knight, 2011). DeWit (2002) found that several financial factors motivated schools to
internationalize, such as increased revenue, growth of the school, and global competitiveness in
the marketplace.
Another benefit of cross-border ventures is developing the capacity for quality higher
education, which is considered poor in developing countries such as Vietnam (Naidoo, 2009).
To satisfy the unmet needs of a country like Vietnam—which has a grossly underserved tertiary
education market—the government works with foreign providers seeking to expand their higher
educational capacity (DeWit, 2002). Many governments in developing countries believe in
EXAMINING MARKET ENTRY STRATEGIES 34
serving the local demand for education without increasing local investment, an aim that can be
achieved through international offshore programs (DeWit, 2002). Some institutions are
motivated to internationalize in order to increase their reputation and prestige in the marketplace.
These institutions usually employ an international strategy to promote their global brand, which
will have a positive effect on its home campus (Altback & Knight, 2011). Many institutions
have academic motivations, seeking to increase the knowledge and cultural awareness of their
students and faculty members.
The motivation for students is that an offshore program provides a foreign degree without
the additional costs of studying abroad. Attending an offshore program saves on airfares, living
expenses, and so on. A degree from a foreign university also improves their employment
opportunities upon graduation (McBurnie, 2006). Lastly, foreign direct investment increases the
job supply for a local nation. New educational ventures generate jobs by hiring local nationals
for administrative positions and academic teaching positions (McBurnie, 2006).
One of the motivations for CU Vietnam is its mission to increase the international
branding of the school. CU has operations in Malaysia, Singapore, and Vietnam, and is focused
on growing internationally. The motivations for any institution expanding abroad will greatly
affect the market entry strategies taken by that institution. As such, recognizing why CU wanted
to expand to Vietnam in the first place will elucidate the decision-making strategies it made
during the market entry process.
Challenges
According to many researchers, developing and operating offshore educational programs
poses several challenges. Chan (2004) has stressed that overseeing and managing offshore
educational programs are quite difficult, with such challenges as finding and keeping
EXAMINING MARKET ENTRY STRATEGIES 35
experienced managers with international experience, which can affect the long-term success of
the offshore ventures. McBurnie (2006) and other experts also pointed to access problems to
education if programs are only able to provide opportunities to students with families wealthy
enough to afford the offshore programs. Another main challenge, according to Knight (2006)
and Green, Eckel, Calderon, and Luu (2007), is quality control and making sure the offshore
program is on par with the program being offered in the home country. To govern the offshore
activities of educational institutions and ensure the quality of the cross-border programs, some
countries—Australia among them—have developed national standards, and more countries are
following suit.
The host country’s regulatory environment can present a formidable challenge that
significantly affects the regulatory requirements of foreign institutions entering the market,
including legal forms, types of partnership, curriculum, and so forth (Willis, 2000). The
difficulty in navigating regulatory policies is particularly evident in developing countries (Welch,
2010). In Vietnam, relationships and experience dealing with the Ministry of Education and
Training are crucial considerations for foreign institutions looking to enter the higher education
market of Vietnam.
Researchers stress that one of the key areas for a success in an offshore educational
program involves understanding the target market. Knight (2006) and Ruby (2009) have
pointed out that developing offshore programs poses significant opportunity costs, challenges,
and risks to any institution interested in this endeavor. Opening offshore programs involves
increased resources on the part of the home institution in the form of time and monetary
considerations (Ruby, 2009). The decision to hire local faculty or to send faculty from the home
country is important, as a lack of awareness of local circumstances can be quite costly when
EXAMINING MARKET ENTRY STRATEGIES 36
considering hiring local faculty. But sending faculty abroad can be even more expensive. Ruby
(2009) has also emphasized that the challenge of getting long-term commitments from faculty
from the home institution can be detrimental to the viability of the offshore program. In
addition, as Knight (2006) has pointed out, hiring local administrative representatives and
financing local marketing efforts to attract prospective students also present significant
challenges. Knight (2006) cited another potential risk for an institution going abroad, explaining
that, if done unsuccessfully, operating an offshore program can hurt the reputation of the home
institution. As a result, researchers and experts alike emphasize the critical nature of fully
understanding the local environment and the target market.
Altbach (2010) concluded that for offshore programs to be successful, they must try to
emulate the same quality of faculty, curriculum, and academic experience provided to students in
the home institution. Exporting the same or a similar type of education to a developing country
can be difficult and costly for the home institution. The benefits and challenges of offshore
programs need to be carefully considered in terms of resource allocation and utilization before a
decision can be made to pursue a cross-border educational venture.
Institutions of higher education can experience many challenges in looking to establish
operations in a foreign country. Some of the challenges that affected the decision-making
strategies of CU Vietnam related to the regulatory environment and the competitive marketplace.
These challenges affected their market entry strategy into Vietnam, and specifically the selection
of an appropriate mode of market entry. The following section addresses the literature on the
different modes of market entry an institution may choose when entering a foreign higher
education market.
EXAMINING MARKET ENTRY STRATEGIES 37
Foreign Market Modes of Entry
When educational institutions enter into cross-border ventures, they face several options
depend on the strategy of each school. This section discusses the literature on foreign market
entry. Different frameworks and models regarding foreign market entry in the education sector
will be discussed. Due to the limited literature in higher education—and to provide additional
context for this study—studies of foreign market entry in other industries that relate to higher
education will also be examined.
The World Trade Organization (WTO), which was established in 1995 and has 153
member countries, authorizes the General Agreement on Trade in Services (GATS) that governs
agreements in the higher education sector between its members (WTO, 1999). The GATS
framework includes four modes of international trade in service industries (Knight 2006). These
include:
Mode 1: Cross-border supply focuses on the service crossing the border,
which does not require the consumer to physically move.
Examples in higher education include distance education and e-learning.
Mode 2: Consumption abroad refers to the consumer moving to the
country of the supplier which in education means students taking
all or part of their education in another country. Examples include traditional
study abroad programs
Mode 3: Commercial presence involves a service provider establishing
a commercial facility in another country to provide a service.
Examples in higher education include branch campuses or franchising
arrangements.
Mode 4: Presence of natural persons means persons traveling to another
country on a temporary basis to provide service. In the education
sector, this would include professors or researchers.
GATS was created as a framework for all service sectors. Knight (2006) wanted to create
something more specific to higher education so she took the GATS framework from the WTO
EXAMINING MARKET ENTRY STRATEGIES 38
and utilized it as a basis for her own framework. Knight (2006) thus created a typology of cross-
border ventures of educational institutions, categorizing each mode of entry more specifically
than GATS. CU Vietnam falls into the Mode 3 category of GATS.
Typology of Foreign Modes of Market Entry in Education
Knight (2006) examined cross-border activities of educational institutions through a lens
of program mobility and provider mobility. Program mobility is the movement of individual
courses or programs from one country to the next through on-site or online learning (Knight,
2006). Provider mobility is the movement of the foreign educational institution to another
country—physically or online—to offer individual courses or programs to local students (Knight,
2006).
Knight’s (2006) typology of program mobility included the following categories:
Franchise, Twinning, Double/Joint Degree, Articulation, and Virtual/Distance. Franchising is
defined as the home institution awarding the degree but authorizing the host institution to deliver
the course or program. Twinning is when the home institution awards the degree but allows the
student to take his or her first year or two of courses at the host institution. The student then
finishes the program in the home country. Double or Joint Degree is when institutions in two
countries collaborate to offer a customized curriculum to the student. The student either receives
a joint degree or a degree from each institution. Articulation is an agreement between two
institutions permitting students to gain credit for taking courses with partnering institutions.
Virtual or Distance is when the home institution delivers its courses or programs through online
learning or other distance methods of educational delivery. Other researchers, such as Armstrong
(2007), Willis (2006), and Bashir (2007), have utilized this typology in their analysis of cross-
border educational ventures.
EXAMINING MARKET ENTRY STRATEGIES 39
Knight (2006) also developed a typology of provider mobility that included the following
categories: Branch Campus, Independent Institution, Acquisition/Merger, Study Center/Teaching
Site, Affiliation/Networks, and Virtual University. A Branch Campus is created when a home
institution establishes a satellite campus in another country to deliver its courses and programs to
the local students in the host country. The degree is awarded by the home institution. An
Independent Institution is created when a foreign provider establishes a stand-alone educational
institution in a foreign country to offer courses or programs to the local students. In this case, the
independent institution has no ties to any institution in the home country of the foreign provider.
An Acquisition or Merger occurs when the foreign institution purchases a local institution to
offer courses and programs. A Study Center/Teaching Site is formed when a foreign institution
establishes a study center in another country to support the student taking its programs.
Affiliation and Networks, the most common provider, are formed when institutions from more
than one country participate in various levels of collaboration to deliver courses and programs
through classroom or distance learning. A Virtual University is the format when foreign
institutions offer courses and programs in other countries through distance education, such as
online classes, and normally without any face-to-face student support services. Knight's (2006)
typology of provider and program mobility provides a lens to look at the foreign market entry of
higher educational institutions. Most of the types of cross-border ventures that Knight
categorizes are similar to mode 3 of GATS, mentioned earlier.
Knight’s research echoes several other studies on foreign market entry by educational
institutions. Examining these studies will help us understand how CU Vietnam entered the
Vietnamese higher education market. Two studies by Willis (2006, 2003) examined market
entry for foreign institutions entering the higher education market in China and in Hong Kong.
EXAMINING MARKET ENTRY STRATEGIES 40
Another study focuses on the foreign market entry modes of US MBA Programs (Czinkota,
Grossman, Javalgi, & Nugent, 2009).
Research Studies on Market Entry
Market Entry Process for China
A study by Willis (2006) provided a context for better understanding the market entry
process in Vietnam. The higher education market in China is—in a number of ways—similar to
that in Vietnam; thus a review of Willis’s market entry framework for the Chinese market can be
helpful in understanding the market entry process in Vietnam.
Willis (2006) introduced a three-stage framework for the market entry process of
educational institutions entering the higher education market in China. Gathering data from over
220 foreign universities that entered the China education market, Willis identified the strategic
market entry process of these institutions and how to form a partnership with a local institution.
Mode 3 of GATS is utilized in China by establishing a commercial presence through partnering
with Chinese institutions. Each stage of the market entry framework by Willis (2006) has a
variety of options that the decision-makers of the foreign universities must carefully consider.
As educational institutions move through each stage, they must make key decisions based on a
variety of factors. In the first stage, foreign universities must survey the variety of partnering
options available and decide on the appropriate local university with which to partner. In the
second stage, key decisions are made about initiating the potential partnership through various
contacting strategies. In the third stage, discussions regarding the terms of the partnership take
place. Strategic decisions are made concerning the type of program to offer and the level of
commitment by the foreign university. Although this three-stage process was formed through a
EXAMINING MARKET ENTRY STRATEGIES 41
study of market entry into China, similar decisions are made when entering other developing
countries, such as Vietnam
Willis’s (2006) Three Stage market entry model reflects the complex decisions a foreign
university must make during the process of entering the Chinese higher education market. The
market entry process for China is highly relevant to the case study of CU Vietnam for several
reasons: Firstly, both governments in China and Vietnam have actively encouraged foreign
universities to offer programs in their countries in recent years; secondly, both countries have a
significant and growing local demand for Western-style education and programs; thirdly, the
regulatory systems at both countries are similar in terms of their central government’s control
over educational institutions; and lastly, local universities in both countries have been highly
receptive to various types of cooperation, including partnership with foreign universities. Given
these similarities between China and Vietnam, studying the market entry process in China may
provide a useful context for examining the market entry of Curtin University Vietnam.
Certainly, one must also to note that the market entry process for Vietnam may employ different
strategies due to the two countries' differences in size, regulatory policies, and economic
development.
Market Entry Options for Hong Kong
Another study on market entry by Willis (2003) outlines the possible options for foreign
universities’ entry to the Hong Kong education market. Although Vietnam is a less developed
country than Hong Kong, the similarities in partnering options in both countries makes Willis's
(2003) research useful in examining CU Vietnam. According to Willis (2003), the higher
education market in Hong Kong allows various options for foreign institutions to enter the
market. The three main options include partnering with Hong Kong universities, colleges, or
EXAMINING MARKET ENTRY STRATEGIES 42
associations (Willis, 2003)—in contrast to China, where the main partnering options are through
local universities (Willis, 2006). Foreign institutions that partner with local universities in Hong
Kong engage in three main types of alliances. Type one is a large-scale umbrella alliance
involving a range of activities, such as research, student exchange, and development and delivery
of courses. Type two is a specific program alliance, which is smaller in scale than an umbrella
alliance and focuses on collaborating on a specific research project or program. Type three of
university partnerships is a course development and delivery alliance that focuses on developing
a specific course or program and is lower in scale than types one or two. Type three
encompasses three options for course delivery in Hong Kong: basic distance education,
augmented distance education (some face-to-face classes), and full on-campus delivery of the
foreign program. The Hong Kong market is not as keen on online classes and prefers delivery
options that have a face-to-face component.
In contrast to partnering with universities in Hong Kong—where large-scale umbrella
alliances are preferred—foreign institutions also partner with smaller colleges to collaborate on
specific courses or programs. The main purpose of foreign universities choosing the option to
partner with smaller local colleges is to develop and deliver foreign degree programs in Hong
Kong. The main delivery option was augmented distance education, which is a mix of online
and in-class instruction. Many foreign institutions preferred partnering with colleges rather than
bigger universities because they felt that colleges were the junior partner in the alliance and
would therefore have less control (Willis, 2003). Foreign institutions also viewed colleges as
more flexible, more cooperative, less bureaucratic, and more enthusiastic than universities in
making strategic alliances.
EXAMINING MARKET ENTRY STRATEGIES 43
Willis (2003) listed the third option for foreign higher educational institutions looking to
enter the market of Hong Kong as partnering with local associations. Associations ranged widely
in size, from small office consultancies to large-scale operations, such as the Hong Kong
Management Association (Willis, 2003). Most foreign institutions, however, partner with larger
associations because they provide more support in marketing, facilities, curriculum, and so forth.
Association differed with universities in several ways. Associations usually promoted foreign
university programs as their core business, whereas universities viewed their own programs as
more important than the foreign degree programs. Associations heavily market the foreign
degree programs but also usually partner with several foreign universities so the programs are
oftentimes in overlapping disciplines (Willis, 2003).
The range of options to consider for foreign universities seeking to enter the Hong Kong
higher education market depends on a variety of factors previously discussed. Each partnering
option must be considered by the decision-makers of foreign institutions seeking to enter Hong
Kong. Previous studies regarding market entry in China (Willis, 2006) and market entry in Hong
Kong (Willis, 2003) are useful in helping contextualize the market entry process for a foreign
university expanding operations in Asia more generally. What follows is a study of business
schools and the factors that influenced their market entry strategy for internationalization.
Market Entry Mode Choice for MBA Programs
Czinkota, Grossman, Javalgi, and Nugent (2009) researched over 100 business schools
offering MBA programs in other countries. The study of market entry modes for MBA programs
engaging in cross-border ventures solely utilized mode 3 of GATS, the mobility of an institution
through a commercial presence in another country (Czinkota et al., 2009). The four types of
market entry included licensing, franchising, joint ventures, and wholly owned investments
EXAMINING MARKET ENTRY STRATEGIES 44
(100%-owned branch campuses) (Czinkota et al., 2009). This study helps identify some key
factors that affect the decision-making strategy in choosing a particular mode of foreign market
entry.
Czinkota et al. (2009) found that the size of the business school had no effect on the
likelihood of an institution pursuing an equity-based venture such as a joint venture or branch
campus mode of entry. Small schools with fewer resources than large schools were not less
likely to choose a joint venture or international branch campus. On the other hand, high levels of
international experience on the part of a business school had a significant effect on schools
pursuing an equity-based venture mode of entry (Czinkota et al., 2009). A business school will
choose this mode of entry because it already has experience forming partnerships and operating
joint ventures. In addition, schools with a greater ability to differentiate their program offerings
will pursue more equity-based ventures as their mode of market entry (Czinkota et al., 2009).
Similarly, schools that offer distinct classroom approaches or advanced technology are more
likely to pursue a joint venture or branch campus. The potential for market growth means that
schools will invest in international branch campuses. In contrast, a greater contractual risk
perceived by a business school will lead to a pursuit of licensing and franchising as the mode of
market entry.
Czinkota et al. (2009) identified various factors affecting the market entry strategy of a
business school that are useful in this case study of CU Vietnam. Their study’s theoretical
framework is Dunning's (1988) OLI eclectic theory of market entry. Dunning's (1988) theory is
the seminal theory on market entry in business literature. By closely examining this theory and
how Czinkota et al. (2009) utilized it as a lens for their study of business schools provides a
richer understanding of foreign market entry strategy.
EXAMINING MARKET ENTRY STRATEGIES 45
Dunning’s OLI Eclectic Framework
The market entry strategy for a university entering a foreign country depends on three
advantages: (O) ownership advantages, (L) location advantages, and (I) internalization
advantages. Dunning's (1988) eclectic theory of market entry articulates the myriad choices
involved in entering and serving foreign markets, such as offering offshore education programs
by American universities. The eclectic theory has been utilized in a number of studies of foreign
market entry mode choice outside the education sector, but Czinkota et al. (2009) were able to
extrapolate it for their study of US MBA programs and their market entry strategies.
According to the OLI Framework, the ownership advantages of a firm factor in whether
an educational institution considers itself multinational. Ownership advantages also include the
ability of an educational institution to handle international expansion in administration,
technological infrastructure, and financial systems. Other ownership advantages include an
educational institution's ability to differentiate its products—or, in this case, its program
offerings as well as its ability to obtain accreditation for the overseas offering and the motivation
level of the administrators pursue overseas markets.
The location advantages of a firm include the main factors of market potential and
investment risk. For educational institutions, this factor relates to whether the target country has
a high demand for higher education and increasing projected growth, and what attitudes the
government has toward encouraging foreign institutions to enter its market. Investment risk for a
location includes the level of political, social, and economic risk, and currency repatriation risk.
A firm’s internalization advantages include the contractual risk and the costs associated
with making and enforcing the contract. This factor includes the firm’s ability to ensure that its
quality of education and academic standards will be maintained in another country. There is also
EXAMINING MARKET ENTRY STRATEGIES 46
the risk associated with protecting the misuse of proprietary knowledge of the university in
overseas programs.
This business framework is useful for analyzing market entry mode choice of foreign
universities. The ownership, location, and internalization advantages of the OLI Framework
provide a clear lens through which to look at what factors influence a school's decision to engage
in a joint venture in higher education, as opposed to entering into a franchising agreement.
Although this framework is limited in that it only serves to analyze market entry mode choices—
rather than looking at the complete process of foreign market entry—it is nonetheless useful for
examining the choices CU Vietnam made in offering an offshore degree program in Vietnam.
Findings from this study were analyzed through the lens of Dunning’s OLI-Framework on
foreign market entry (Dunning, 1988). As will be discussed in Chapter Four, the researcher
examined how the ownership advantages, location advantages, and internalization advantages
systematized in the OLI-Framework impacted Curtin Vietnam’s decision-making strategies.
Due to the scant research on market entry of foreign universities, a discussion on market
entry outside of higher education will follow. Examining business literature on the market entry
strategies of international ventures outside of education provide additional context for this study.
International Ventures Outside of Education
The strategies of international ventures outside of higher education can inform our
understanding of cross-border educational ventures. Pulkkinen and Larimo (2007) examined
international ventures in service industries, describing some companies that target the
international market by launching new ventures in several countries and others that exclusively
focus on expanding in one or two countries. Oviatt and McDougall (1994) provided evidence
that the type of international strategy a firm takes depends on a variety of factors, including the
EXAMINING MARKET ENTRY STRATEGIES 47
characteristics of the firm, such as resource budget and prior international experience, as well as
potential size of the market and the competitive environment. The pull factors are similar in
higher education in terms of high student demand due to the low number of quality institutions in
developing countries (Armstong, 2007; Bashir, 2007). This situation means that the market
potential in developing countries is very high due to low competition. In addition, push factors
for the internationalization of higher education largely depend on the prior experience of schools
with international enterprises and the desire to increase their brand image globally (Huang,
2007). Firms that already have international operations in at least one country are more likely to
expand into others, doing so as part of an overall global marketing strategy (Acedo & Jones,
2007; Reuber & Fischer, 1997). This situation resembles that of universities such as RMIT,
which has many offshore educational programs throughout the world, and continues to expand
its operations globally (Fry, 2009).
Typology of International Ventures
International ventures in business can be categorized in different ways. One typology by
Baum, Kabst, and Schwens (2011) classifies new international ventures across four categories,
which provide an additional lens for cross-border ventures in higher education. The four
categories of new international ventures are Export-Import Start-up, Geographically Focused
Start-Up, Multinational Trader, and Global Start-Up. Global Start-Ups, which serve a vast
amount of international markets and coordinate many activities in those countries, are normally
developed from a highly globally experienced management team and put a high value on growth.
This effort requires an enthusiastic management team with high aspirations to expand.
Geographically Focused Start-ups may coordinate many activities but are usually concentrated
in only several countries located close together. They usually involve managers with significant
EXAMINING MARKET ENTRY STRATEGIES 48
international experience and some type of knowledge advantage, such as in research and
development. Multinational Traders may only choose one or two countries but look to serve a
diverse set of markets, offering different types of products. Product differentiation is key for
them as they are able to offer many variations on the same product, simultaneously meeting
high-end and low-end markets. Export-Import Start-Ups have a low number of international
operations and a limited role in those activities abroad, usually due to their small size and lack of
resources. On the other hand, they are also fairly flexible and nimble, which allows them to meet
changing market demands more quickly than others.
These four types of international ventures are capable of describing the activities of
foreign universities seeking to enter new foreign educational markets. Global Start-Ups could
represent new foreign for-profit universities whose main motivation is growth. Geographically
Focused Start-Ups could represent bigger, more established universities looking to expand
offshore degree programs very heavily in one region, such as Southeast Asia. Regardless, this
typology created by Baum, Kabst, and Schwens (2011) provides additional context for the case
study of CU Vietnam. Because CU Vietnam operates in a country with so many dynamic
changes, examining how higher education has evolved there over the years is important.
Conclusion
Chapter Two reviewed the key literature on the internationalization of higher education,
including the effects on higher education, major factors in organizing offshore programs, and
types of offshore programs. Also reviewed were the higher education environment in Vietnam
and specific educational reforms, major changes in education in recent years, and significant
trends in higher education in Vietnam. This chapter also explored challenges and benefits of
EXAMINING MARKET ENTRY STRATEGIES 49
offshore programs in developing countries, particularly in Vietnam. In addition, the literature
review examined various models related to foreign market entry, with specific case studies in
Asian countries. The literature on market entry in the business literature was also examined for
what it could reveal about higher education market entry.
With limited research to date in the area of internationalization of higher education in
developing countries, particularly in Vietnam, this study underscores the need to critically
examine key factors in organizing and implementing offshore programs and to fully address the
major challenges faced by foreign providers of higher education in developing countries. Chapter
Three will present the methodology used for this study.
EXAMINING MARKET ENTRY STRATEGIES 50
CHAPTER THREE: RESEARCH METHODS
Many higher education institutions from developed countries are expanding their global
reach by focusing on internationalization efforts in developing countries. These institutions are
entering new emerging markets in a variety of ways—creating branch campuses, joint degree
programs, twinning arrangements, and other offshore programs. Developing countries present a
popular target market for a number of Western institutions because they are underserved by local
institutions and have students that often show a preference for Western education (Huang, 2007).
One such country is Vietnam, where Curtin University established a Master of Arts in Applied
Linguistics Program in Ho Chi Minh City. Despite the increase in the number of
internationalization activities by schools in developing countries, this phenomenon is still
relatively new, thus research on how universities enter a new market and the strategies they
employ is still lacking. This study examines the market entry process for the CU Vietnam in
creating an offshore program in the emerging market of Vietnam. The focus is on how the
regulatory environment and the competitive marketplace shaped CU's market entry strategy. The
over-arching goal was to understand CU's strategy behind the market entry process and how CU
implemented it.
Chapter Two offered an overview of the various aspects of foreign market entry of
educational institutions and factors related to internationalization strategies. The literature on the
growing number of Western institutions and their cross-border educational programs in
developing countries was covered, as were the strategies behind the market entry process of
universities entering several countries in Asia.
Dunning’s (1988) OLI-Framework served as the theoretical framework for this study.
This model supported the researcher’s effort to examine and illuminate the location advantages,
EXAMINING MARKET ENTRY STRATEGIES 51
ownership advantages, and internalization advantages that affected CU’s market entry strategy.
As discussed throughout this dissertation, CU navigated numerous factors and potential
challenges, the significance of which Dunning’s (1988) OLI-Framework helps to unpack. Using
Dunning’s (1988) framework helps schematize the process of establishing offshore educational
programs and supports studies focused on understanding the strategies behind university foreign
market entry strategies. This research will inform best practices for other universities seeking to
internationalize in developing countries, particularly in Vietnam.
This research utilized qualitative research methods, which are ideal for case studies, as
they help probe and gather in-depth data more effectively (Patton, 2002). The following sections
will be covered in Chapter Three: research questions, research design, population and sample,
instrumentation, data collection and analysis, framework, and validity and reliability.
Overarching Research Question:
What was Curtin University's market entry strategy for expanding into Vietnam, and how was it
implemented?
Sub-Questions:
1. What factors shaped Curtin University's market entry strategies for expanding into
Vietnam?
2. How did the competitive marketplace in Vietnam affect the market entry strategies of
Curtin University?
3. How did the regulatory environment of Vietnam's higher education sector affect the
market entry strategies of Curtin University?
EXAMINING MARKET ENTRY STRATEGIES 52
Research Design
The research design for this qualitative study was a case study of the Curtin University in
Vietnam. The market entry process of an educational institution is very complex; a case study
method allows for greater exploration of specific details and nuances to the critical factors
involved. Qualitative methods of inquiry helped the researcher gather a wealth of data not
"constrained or limited by predetermined analytical categories" (Patton, 2002, p. 227). This
design allowed the study to uncover new information and data of which the researcher was
previously aware. Utilizing a case study method of inquiry helps the researcher gather rich data
in a systematic process that facilitates a comprehensive analysis of findings (Patton, 2002).
Findings from this case study mainly came from participant interviews with key administrators
and faculty of Curtin University. Other forms of qualitative research data were collected through
observations and document analysis. This case study sought to explicate CU’s market entry
strategy and implementation.
A single case study, which is a form of purposeful sampling, is appropriate for this study
on foreign market entry because it allows the researcher to collect data on many variables and
produces a rich analysis of complex processes (Patton, 2002). Many factors and variables were
involved in the market entry process of CU Vietnam. The case study method is suitable for
research studies that aim to gain a first-hand understanding of processes through descriptive and
explanatory questions (Merriam, 1998). The case study approach is the right choice for this
research study because it allowed access to the perspectives of the senior leaders through direct
interviews.
Curtin University, located in Perth, Australia, oversees the program in Vietnam.
Although the Master’s Program is offered in Ho Chi Minh City, Vietnam, the majority of the
EXAMINING MARKET ENTRY STRATEGIES 53
research was conducted in Perth, is the city in which the senior leaders of the program reside. A
case study methodology allowed data collection and analysis to provide a better understanding of
the decisions made by Curtin University regarding the market entry process in Vietnam and the
strategies behind it.
Population and Sample
The units of analysis for this case study were senior administrators and faculty members
of Curtin University who had knowledge of the Master’s program in Vietnam. This population
included the Deputy Vice-Chancellor International and Dean of International Development for
Curtin University. Other senior faculty members and administrators involved with the initial
launch of the program were recruited to participate as well—among them, administrators and
faculty members who reside in Australia. Data from all participants provided the various
perspectives necessary to fully understand the market entry strategies of Curtin University
Vietnam.
The interview participants for this study are listed below:
1. David Wood, Deputy Vice-Chancellor, International
2. Simon Ridings, Dean, International Development
3. Bronwyn Bartsch, Manager, Curtin International
4. Nigel de Silver, Manager, International Quality and Research
5. Walter Ong, Dean, International Student Admissions
6. Simon Leunig, Program Director of CU Vietnam
7. Paul Mercieca, Program Coordinator of CU Vietnam
8. Toni Dobinson, Lecturer, School of Education, CU Vietnam
9. Ilan Zagoria, Lecturer, School of Education, CU Vietnam
EXAMINING MARKET ENTRY STRATEGIES 54
10. Graham Dellar, Professor, School of Education, CU Vietnam
11. Rhonda Oliver, Professor, School of Education, CU Vietnam
12. Jane Grono, Manager, Contracts and Partnerships
13. Andy Kirkpatrick, Adjunct Professor, Curtin University
Instrumentation
The researcher served as the research instrument for collecting data for this qualitative
research study. The researcher utilized inductive research to gather pertinent information from
the faculty and administrators of Curtin University regarding the decision-making strategies of
the market entry process. Two methods of data collection were utilized in this study:
interviewing and document analysis. Data provided insight into the market entry process,
allowing the researcher to understand the unique strategies undertaken by the senior leaders of
Curtin University.
Documents were also a key source of data, because they are easily accessible and can
complement interview data very well through triangulation (Merriam, 1998). This material
included the website of the Curtin University. Meeting minutes and the Memorandum of
Understanding were also examined to gather diverse sets of data to analyze and triangulate.
Participant interviews were the main method of qualitative research utilized in this study.
To properly understand the emic perspective, or insider's perspective, a researcher may conduct
interviews to gather in-depth insights from their participants (Patton, 2002). Interviewing the
administrators and faculty of CU afforded better access to key information that helped inform the
market entry process of CU in Vietnam. The interview questions for this study were developed
EXAMINING MARKET ENTRY STRATEGIES 55
with the research questions in mind and how they related to each of the three stages for market
entry.
Interview Protocol
The following interview protocol was created with regard to the research questions. An
interview guide approach was taken to ensure main topics were covered and to allow for the
discovery of new topics as well. They were submitted to the University of Southern California
Institutional Review Board for approval before the study commenced. For background, each
participant was asked to describe his or her present roles and responsibilities. The interview
protocol questions followed, but certain questions were omitted due to the varying roles each
participant had during the initial market entry process. The following questions were asked of
the administrators and faculty who had knowledge of the market entry process for Curtin
University Vietnam:
Research Question: What was Curtin University's market entry strategy for expanding
into Vietnam, and how was it implemented?
1. What role did you play when CU first decided to enter the Vietnam higher education
market?
2. What obstacles did CU face during the market entry process? How did CU overcome
these challenges?
Sub-Question 1: What factors shaped Curtin University's market entry strategies for
expanding into Vietnam?
3. What factors were the most important in deciding to enter the Vietnam education market?
4. Why did you choose to offer an offshore program with the local partner as opposed to a
franchising , twinning, or establishing a branch campus?
EXAMINING MARKET ENTRY STRATEGIES 56
5. What factors contributed to the decision to pursue a partnership with SEAMEO?
Sub-Question 2: How did the regulatory environment of Vietnam's higher education
sector affect the market entry strategies of CU Vietnam?
6. How did the regulatory environment in Vietnam shape your decision-making when it
came to your roles and responsibilities during the market entry process?
7. What role did MOET play in shaping CU's decision to partner with SEAMEO?
8. How did the regulatory environment affect your negotiating strategies when finalizing the
terms of strategic partnership?
Sub-Question 3: How did the competitive marketplace in Vietnam affect the market entry
strategies of Curtin University?
9. What factors were important in evaluating the local partner with which you desired to
form a strategic partnership?
10. How did the local competition affect your decision to offer a blended offshore Masters
Program in Applied Linguistics?
11. If you were to start over, would you make the same decisions? Why or why not?
Data Collection and Analysis
Qualitative methods were utilized for data collection in the form of interviews with the
senior leaders of Curtin University and analysis of related documents. Interviews were
conducted in person at Curtin University in Perth, Australia. As previously mentioned, an
interview guide approach was utilized as the interview protocol for this research study. An
interview guide approach ensures that important topics will be discussed but allows for
additional probing and exploring by the interviewer to uncover unforeseen data from the
participants (Patton, 2002). This method not only ensures that the researcher covers all the major
EXAMINING MARKET ENTRY STRATEGIES 57
topics, but also allows the researcher flexibility when interviewing the participants. Using an
interview guide approach for the senior leaders of Curtin ensured that comprehensive data was
collected, including findings pertaining to major factors that affected decision-making during the
market entry process.
Important documents, such as the website and the memorandum of understanding with
local partner SEAMEO RETRAC, were analyzed as part of data collection. Triangulation of
data from document analysis and participant interviews helped determine emergent trends in the
data (Merriam, 1998). Using an interview guide approach helped in analyzing data because
similar questions were asked of all respondents (Patton, 2002). Together this strategy allowed
the researcher to discover trends in the data translated into to common themes in the analysis.
Properly coding data to allow patterns to emerge and deeper analysis to take place is
crucial (Patton, 2002). Data from this study were coded according to the research question and
sub-questions. Potential themes related to market entry included the following: regulatory
environment, local competition, mode of market entry strategy, or negotiation process.
Framework
As previously described in Chapter Two, the framework used as a lens for this study was
Dunning’s (1988) OLI Framework. Using a framework to guide data collection and analysis is
important for any qualitative study (Merriam, 1998). Any educational institution seeking to
expand in a foreign country will need to consider these factors during the process from initial
evaluation of partnering options to finalizing the details of the international expansion.
Validity and Reliability
Validity and reliability issues arise in all types of qualitative research. The researcher
must be aware of these issues in order to employ strategies that will minimize their impact. The
EXAMINING MARKET ENTRY STRATEGIES 58
three main factors that affect the credibility of qualitative research are the extent of rigor in the
methods, the degree to which the data are credible based on experience and expertise, and the
depth of belief that the philosophy of qualitative inquiry is inherently useful (Patton, 2002).
Triangulation supported the rigor of the methods used in this study (Merriam, 1998).
Data from interviews of multiple participants and analysis of various documents were
triangulated to find common themes and patterns. The goal in analyzing data is to ensure
consistent findings through the numerous data sources, which helps alleviate some of the issues
relating to validity and reliability.
Researcher bias was identified before gathering and analyzing data as a way to increase
the credibility of the researcher. The goal of this research was to identify strategies for market
entry into Vietnam. It is acknowledged that the ethnic background of the researcher is
Vietnamese, and although this factor may have helped the study, it is noted that it may also have
created a potential bias. Having recognized this potential researcher bias before the study was
conducted may have made analysis of the data and subsequent findings more credible. Lastly,
Patton (2002) has discussed the usefulness of qualitative research methods of inquiry. The
researcher believes in this philosophy and conducted an in-depth case study analysis of CU
Vietnam to capitalize on the utility of qualitative inquiry.
Conclusion
Curtin University's School of Education in Vietnam was utilized as a single case for this
qualitative research study. The study sought to collect extensive data on the decision-making
strategies Curtin used during the market entry process of its Master of Arts in Applied
Linguistics Program in Vietnam. Intensive interviews with key administrators and faculty were
conducted to collect rich data that was triangulated with data from document analysis of
EXAMINING MARKET ENTRY STRATEGIES 59
materials related to Curtin University Vietnam. Data analysis uncovered patterns and trends that
produced findings for the study. Chapter Four will explain and detail all of these findings.
EXAMINING MARKET ENTRY STRATEGIES 60
CHAPTER FOUR: RESEARCH FINDINGS
This chapter presents the findings of a qualitative research study conducted at Curtin
University in Perth, Australia. Data from this study were collected through participant interviews
and analysis of several important documents. With more universities looking to expand their
programs internationally by establishing offshore programs in developing countries, the process
of Curtin University’s entry into the market of Vietnam through its offshore Master of Applied
Linguistics program offers valuable lessons. Interviews were conducted with 13 key
administrative and faculty members of Curtin University staff and faculty. All of the data have
been compiled, analyzed, and synthesized to present the factors that Curtin University faced
during the market entry process in Vietnam, which began in 2005. This study seeks to enhance
the extant research on foreign market entry strategies of higher educational institutions by
strategically considering the factors that affected the decision-making of Curtin University’s
entrance into Vietnam.
Interviews at Curtin University Australia were conducted over one week in November
2012. All of the interview data were collected in person except for data from one Curtin
University faculty member, who was interviewed over the telephone. Some interviews were as
short as 30 minutes, whereas others lasted up to 90 minutes.
The theoretical lens for this study was the OLI-Framework (Dunning, 1988), a seminal
theory of foreign market entry strategy. The OLI framework utilizes three main determinants that
affect market entry strategy: ownership advantages, location advantages, and internalization
advantages. Ownership advantages comprise several key characteristics of a university, such as
resource capabilities, internationalization experience, and ability to differentiate programs.
Location advantages focus mainly on the following information about the target country’s
EXAMINING MARKET ENTRY STRATEGIES 61
market: economic growth potential, political and regulatory climate, and operational cost
benefits. Internalization advantages come directly from the university’s capacity to manage and
coordinate the activities abroad and its ability to ensure that the quality of education and
academic standards are maintained. In this study, the OLI-Framework allowed the researcher to
better synthesize the data, thus yielding comprehensive findings.
This chapter analyzes the case study in several parts, beginning with a brief overview of
Curtin University and its local partner in Vietnam, the Southeast Asian Ministers of Education
Organization Regional Training Center (SEAMEO RETRAC). Next, the chapter details the
history and structure of the program in Vietnam. A lengthy discussion of the following
overarching research question and sub-questions follows.
Overarching Research Question
What was Curtin University's market entry strategy for expanding into Vietnam, and how was it
implemented?
Sub-Questions:
1. What factors shaped Curtin University's market entry strategies for expanding into
Vietnam?
2. How did the competitive marketplace in Vietnam affect the market entry strategies of
Curtin University?
3. How did the regulatory environment of Vietnam's higher education sector affect the
market entry strategies of Curtin University?
Findings from the three sub-questions collectively address the overarching research question
about Curtin’s strategy and implementation for market entry into Vietnam. A conclusion at the
end of this chapter summarizes the findings from this case study.
EXAMINING MARKET ENTRY STRATEGIES 62
Overview of Curtin University
The researcher learned about Curtin University’s Master of Arts in Applied Linguistics
program in Vietnam through an initial phone conversation in August 2012 with Dr. David Wood,
Deputy Vice-Chancellor of International for Curtin University. The program in Vietnam
intrigued the researcher because of its unique structure and delivery format, in which Curtin
University instructors periodically fly to Vietnam to teach the program in person. Moreover, it
was apparent that Curtin University and Dr. David Wood had extensive experience in the
internationalization of higher education, offering the researcher an opportunity to closely
investigate the market entry process of Curtin University Vietnam. The researcher went to Perth,
Australia, in October 2012 to conduct research and collect data over the course of five days.
Before the trip, the researcher set up the interviews with 13 faculty and staff members
across three departments, all of which had varying levels of involvement in and control of Curtin
University’s offshore programs. The three departments were the Office of the Deputy Vice-
Chancellor, the Humanities International and Marketing Office, and the School of Education.
The Office of the Deputy Vice-Chancellor International oversees all onshore and offshore
programs that Curtin University offers to international students, including the Master of Arts in
Applied Linguistics program in Vietnam. The researcher interviewed the head of this office, Dr.
David Wood, and several of his staff members during data collection. At the time of the
interview, Dr. Wood was the Deputy Vice-Chancellor International, a position that placed all
international affairs under his purview. Until the 2006 entry into Vietnam, Wood officially
served as the Executive Dean of Humanities and was the main supervisor for evaluating potential
partnerships, managing subsequent contract negotiations, and establishing the partnership with
SEAMEO RETRAC.
EXAMINING MARKET ENTRY STRATEGIES 63
The researcher also interviewed the head of the Humanities International and Marketing
Office, Mr. Simon Leunig, whose official title was Dean of International Student Admissions.
His office oversaw the admissions process for all international students enrolled in programs that
fell under the Faculty of Humanities. The School of Education, under the purview of the Faculty
of Humanities, offered the Master of Arts in Applied Linguistics program in Vietnam. All of the
students who had enrolled in this program with SEAMEO RETRAC since 2006 had gone
through the admissions process with this office.
The School of Education at Curtin University offers programs from the bachelor level to
the doctoral level. The Master of Arts in Applied Linguistics is offered by the School of
Education onshore in Australia and offshore in Vietnam. Faculty members of the School of
Education coordinate and teach the program in Vietnam. The researcher interviewed several
faculty members who delivered the program offshore in Vietnam. Several interview participants
also served as the Coordinator of Curtin Vietnam at some point in time, which meant each of
them was the main person who oversaw the program, ensuring that the program was run well
both academically and administratively.
Overview of SEAMEO and its Regional Centers
The Southeast Asian Ministers of Education Organization—known as SEAMEO—is a
multilateral collaboration between the governments of 11 Southeast Asian countries, including
Vietnam and Singapore, working to improve educational cooperation among countries in the
region. The governing body, the SEAMEO Council, consists of Education Ministers from all 11
countries and is collectively devoted to its motto “Leading through Learning.”
Of the 20 SEAMEO regional centers located across these 11 countries, two were
involved in Curtin’s original agreement to offer its Master of Arts in Applied Linguistics in
EXAMINING MARKET ENTRY STRATEGIES 64
Vietnam; the SEAMEO Regional Training Center (RETRAC) in Vietnam and the SEAMEO
Regional Language Center (RELC) in Singapore. When the program was established in 2006,
Curtin University had partnered with both RETRAC and RELC through a tripartite agreement. In
2010, RELC left the partnership. At that time, the arrangement evolved to a bilateral
arrangement between Curtin University and RETRAC, jointly operating the Master of Arts in
Applied Linguistics program.
SEAMEO RELC
SEAMEO RELC, located in Singapore, focuses on the advancement of English Teacher
Education. Its goal is to develop and improve the capacity of the region’s language teachers to
meet the growing demand for learning the English language. RELC offers several programs in
English Teacher Education, such as certificates in Teaching Oral Communication Skills and
Teaching English to Speakers of Other Languages. One of its most popular programs is the
postgraduate diploma in Applied Linguistics, which is offered onshore in Singapore and was
previously offered offshore in Vietnam in collaboration with RETRAC. RELC’s pre-existing
graduate diploma program in Vietnam with RETRAC was a key factor in the subsequent market
entry of Curtin University Vietnam. This joint diploma program began operating in Vietnam in
the early 2000s.
SEAMEO RETRAC
SEAMEO RETRAC, located in Ho Chi Minh City, Vietnam, focuses on developing
educational leadership and management in the region. Its goal is mainly to serve Vietnam and
some of its neighboring Southeast Asian countries, such as Cambodia, Laos, and Myanmar. In
addition to offering educational training courses, workshops, and conferences, RETRAC has
several English training programs, such as the Master of Arts in Applied Linguistics program
EXAMINING MARKET ENTRY STRATEGIES 65
with Curtin University. As mentioned previously, for several years, RETRAC partnered with
RELC to offer a graduate diploma in Applied Linguistics in Vietnam. Then, in 2005, Curtin
agreed to articulate the courses taught in the graduate diploma by RELC into their Master of Arts
in Applied Linguistics program. This arrangement meant that Curtin would accept the four
postgraduate diploma courses taught by RELC as transfer credit toward the MA program, in
effect, fulfilling half of the degree requirements. As will be discussed later, this transfer
agreement was a driving force behind Curtin’s market entry strategy into Vietnam. Eventually,
the agreement with Curtin Vietnam was only between RETRAC, with RELC dropping out in
2010.
Program Structure
The Master of Arts in Applied Linguistics program offered by Curtin University in
Vietnam started in 2006 as a tripartite agreement among Curtin University in Australia,
SEAMEO RETRAC in Vietnam, and SEAMEO RELC in Singapore. Offered in Vietnam mainly
to local Vietnamese students, this program lasts one year and requires the completion of eight
courses. As of February 2013, 11 student cohorts had enrolled in this program. The first cohort
started in 2006, and the cohort most recent to the period of data collection for this study—the
11th cohort—enrolled in February 2013. Each cohort enrolls an average of 30 to 50 students.
The partnership arrangement outlined the duties for each of the partners. RETRAC was
assigned responsibility for administering the program in Vietnam, including collecting
admissions documents from students, marketing and recruiting new students, providing local
student support services, and supplying and operating the facilities. In 2010, RETRAC was
responsible for teaching three of the courses. Curtin University is responsible for providing the
program curriculum (eight courses) required by the master’s program, teaching four of the
EXAMINING MARKET ENTRY STRATEGIES 66
courses (this changed to five courses in 2010), approving all admissions decisions, and managing
quality control of the academics. RELC was mainly responsible for teaching the first four
courses of the degree, until 2010, when it ceased involvement with the program.
Course Delivery
Curtin Vietnam’s Master of Arts in Applied Linguistics program has a unique format,
whereby course instruction is delivered through four workshops in Vietnam held over one year.
Of the four workshops, one usually takes place in February, one in May or June, one in August
or September, and the last one in November or December. Each workshop is one week long and
delivers two courses at the same time. Students take one course in the morning for 4 hours and a
different course in the evening for 4 hours. Each course is delivered over 5 days. Curtin
Vietnam’s offshore Master of Arts program contrasts significantly with the onshore program in
Perth, Australia, where each course is delivered over a period of 12 weeks.
This program’s compacted course delivery method was developed with the instructors
and students in mind. Staffing the program can be challenging, so having instructors fly to
Vietnam one week at a time is more practical than having them stay for longer periods. Further,
students come from all over Vietnam, so traveling to the center of Ho Chi Minh City for one
week is more convenient for them as well.
When the program started in 2006, RELC instructors flew in from Singapore to teach the
first four courses of the program, and Curtin instructors flew in from Australia to teach the last
four courses. Each student who completed the first four courses earned a postgraduate diploma
in Applied Linguistics from SEAMEO RELC. These four courses articulated into the Master of
Arts in Applied Linguistics program with Curtin University, which meant that once students
EXAMINING MARKET ENTRY STRATEGIES 67
completed the subsequent four courses taught by Curtin instructors, they would be awarded the
Master of Arts in Applied Linguistics degree.
This program structure changed in 2010, when SEAMEO RELC was no longer involved
in the partnership. At that point, it became a partnership agreement exclusively between Curtin
University and SEAMEO RETRAC. The instructors delivering the course changed as well.
Because RELC was no longer teaching the first four courses of the program, the new agreement
specified that Curtin would teach five courses and RETRAC would teach three. The structure of
teaching one-week workshops four times a year and two courses at the same time didn’t change.
Student Population
Students enrolled in CU’s Vietnam’s Master of Arts in Applied Linguistics program have
been mainly local Vietnamese students. As of 2013, across the 11 cohorts, a small number of
expatriates from the United States, Canada, the Philippines, and Indonesia have enrolled in the
program. The majority of the students worked as English teachers at the primary or secondary
level, prior to enrolling in the program. They usually hold a bachelor’s degree in English
Language Teaching and are motivated to earn additional teaching qualification. A handful of
students may not have a bachelor’s degree in English Language Teaching, but usually have at
least several years of English teaching experience. Students’ main purpose for enrolling in this
program is to get a promotion or pay raise at their current place of employment. At the same
time, they are very motivated to gain more knowledge and experience in language teaching,
which will equip them with the skills to become better English teachers.
Most of the students face many challenges and obstacles to completing the program. The
majority of the students works full-time and takes time off from work to attend the four
workshops. A significant number of students have two jobs; they may work a government-
EXAMINING MARKET ENTRY STRATEGIES 68
teaching job during the day and teach at a private language school in the evening. In addition to
having family obligations to tend to, many students live in the Mekong Delta and travel a great
distance to attend the workshops in the city. Students who live in remote areas must periodically
cope with natural disasters such as hurricanes and typhoons. These extreme hardships make it
tougher to travel to CU Vietnam’s campus and also may affect their access to the Internet, which
is necessary to doing their work.
Despite these challenges, the majority of students at CU Vietnam persevere and complete
the program by successfully attending the four workshops and passing the eight requisite
courses. This success is largely due to their high levels of motivation to earn a Western
education—not only to gain knowledge and expertise in language teaching, but also for the
recognition and credibility the degree affords them. The local Vietnamese students are extremely
hard working and appreciate the convenience and flexibility of the accelerated structure of the
program because it meets the needs of their schedules.
Research Questions
The researcher used document analysis and interviews to examine the strategies behind
Curtin University’s market entry into Vietnam. The findings from this study were analyzed by
addressing the three sub-questions through the lens of Dunning’s OLI-Framework on foreign
market entry (Dunning, 1988). The researcher examined how the ownership advantages,
location advantages, and internalization advantages discussed in the OLI-Framework impacted
Curtin Vietnam’s decision-making strategies. Data from the three sub-questions collectively
answer the overarching researching question regarding Curtin University’s strategy for and
implementation of market entry process in Vietnam. As such, the sub-questions are addressed
below first; a summation at the end examines the findings for the overarching research question.
EXAMINING MARKET ENTRY STRATEGIES 69
Research Sub-Question 1
What factors shaped Curtin University's market entry strategies for expanding into
Vietnam?
During data analysis, several themes that affected market entry strategy emerged.
Utilizing the OLI-Framework as a lens for the study elucidated the main factors CU’s senior
leaders faced during the decision-making process. An acronym applied to market entry strategy,
OLI involves (O) ownership advantages, (L) location advantages, and (I) internalization
advantages. For this case study, these terms involved the ownership advantages CU possessed,
the location advantages of Vietnam, and the internalization advantages that CU felt it could
utilize.
Ownership advantages represent an educational institution’s ability to handle
international expansion, to differentiate its products, to obtain accreditation, and to inspire the
necessary level of motivation in its administrators. In this category, CU was able to exploit many
of its unique strengths, including building key relationships and providing offshore educational
programs.
In considering location advantages, an educational institution must be assured that the
target country has substantial demand for higher education—with projected growth—and a
receptive attitude about the market entry of foreign institutions. With a growing market, open
and collaborative partners, and increasing student demand, Vietnam met all of the criteria of an
advantageous location.
The third and final category of significance in the framework are internalization
advantages, which involve assessment of contractual risks and costs, maintaining quality of
education and academic standards, and protecting proprietary knowledge from misuse. CU’s
EXAMINING MARKET ENTRY STRATEGIES 70
internalization advantages consisted of its ability to internalize operations overseas and to
maintain standards for its offshore programs comparable to the high quality programs offered at
its home campus in Perth, Australia.
Curtin University’s strengths. Data from the interviews made clear that the experience,
background, and expertise of Curtin University, its staff, and faculty members, were tremendous
advantages in Curtin University’s effort to enter the Vietnam market through its offshore Master
of Arts in Applied Linguistics program. Curtin University’s vast experience in
internationalization activities allowed it to enlist many of its strengths to make decisions that
impacted the market entry process. CU’s strengths include its ability to recognize and leverage
important relationships to achieve its objectives, its leadership team’s appropriate experience in
offering the optimal program for its students, and its capacity to manage the international
expansion administratively, technologically, and financially. These strengths of Curtin closely
mirror the ownership advantages of the OLI-Framework, which stress the importance of having
previous international experience and the ability to leverage those experiences to guide foreign
market entry strategies (Dunning, 1988). Dunning (1988) has also emphasized the ability of
multinational firms to expand in foreign markets, citing the substantial advantages a firm
possesses when its staff and resources are ready and able to support its overseas ventures. This
study’s findings clearly exemplified some of these ownerships advantages.
Crucial relationships. Through analysis of the data, the researcher gained a deeper
understanding of how important relationships were to Curtin University’s market entry strategy.
At various stages of the market entry process, relationships affected several key decisions made
by CU, such as selecting the best country market to target, determining the most efficient mode
of market entry, and finding an appropriate local partner. Many interview respondents credited
EXAMINING MARKET ENTRY STRATEGIES 71
Andy Kirkpatrick—a professor of Language Education for CU who explored different ways to
enter the Vietnam market—with initiating the offshore program in Vietnam in 2005.
In an interview, Kirkpatrick expressed his awareness of RELC’s partnership with
RETRAC, which offered a graduate diploma in Applied Linguistics offshore in Vietnam.
Kirkpatrick had argued for the benefits of partnering with RELC to articulate its graduate
diploma courses into CU’s master’s program. In initial discussions between CU and RELC, the
most important aspect was the close relationship between Kirkpatrick and Nguyen Change, the
director of RELC, which helped initiate the CU-RELC partnership. One CU faculty member
noted in an interview, “Andy was established and well-respected in Asia,” and his relationship
propelled the partnership forward at the time. Kirkpatrick was aware of the importance of his
relationship with RELC and explained the value of such alliances in Asia thusly:
Well, you know I am sure that 90% of the work done in Asia is through friendships and I
understand then there are lots of people who work there for years one way or another so I
had very close friends throughout Asia.
The theme of relationships was evident during other aspects of the market entry process. Having
key relationships—and being able to identify them—was an ownership advantage that became a
crucial part of CU’s strategy. The findings clearly showed that CU targeted RELC for its existing
relationship with RETRAC in Vietnam. RELC and RETRAC were part of the larger SEAMEO
organization but had a deeper relationship, having been partners since 1998. Importantly, trust
had been built over an extended period of time during the course of the relationship—an
advantage evidenced by RELC’s joint management of its offshore graduate diploma in Applied
Linguistics program with RETRAC since 1998. This existing RELC-RETRAC partnership
EXAMINING MARKET ENTRY STRATEGIES 72
made it more attractive to partner with RELC because CU knew that RELC’s long-lasting
relationship with RETRAC would make it easier to initiate a tri-member partnership.
Another key relationship in CU’s strategy was between RETRAC and Vietnam’s
Ministry of Education and Training (MOET), the government entity responsible for regulating
educational institutions including those providing professional teacher preparation programs. CU
leaders knew that SEAMEO was a well-respected educational organization with close ties to
local governments. As will be discussed in more detail later in this chapter, CU staff and faculty
were keen on partnering with RETRAC because it knew that RETRAC’s close relationship to
MOET would facilitate market entry into Vietnam. One of the barriers to entering a country’s
market can be obtaining the proper licenses and approval from government authorities to
legitimately operate a school, but CU knew this effort would be achieved much more easily by
partnering with RETRAC. As CU’s Vice-Chancellor explained, “SEAMEO organizations have
close connections with local government and were able to easily get government approvals.” The
close relationship between SEAEMO RETRAC and MOET was a major reason why CU chose it
as a local partner.
CU senior leaders knew how to utilize their ownership advantage by recognizing
important relationships and the potential to leverage them to their benefit. As Dunning (1988)
has stated, having strong advocates for international expansion at the beginning is a major plus in
foreign market entry. That Kirkpatrick and his counterpart at RELC were clear advocates early
on helped the process move forward quickly. Once Wood became involved, development went
smoothly because he was very keen on expanding CU’s international activities. As a senior
leader of CU, Wood recognized the existing key relationships among RELC, RETRAC, and the
government of Vietnam.
EXAMINING MARKET ENTRY STRATEGIES 73
Experience in internationalization activities. Curtin University’s international experience
with offshore campuses and programs had a pronounced influence on its market entry strategy.
Its vast experience and global focus afforded a clear ownership advantage that guided its
decision-making. As one faculty member explained, decisions made by CU during the market
entry process into Vietnam were based on prior experience creating and operating offshore
programs. Curtin University prides itself on being an international university focused heavily on
serving students from countries all over the world. Curtin University’s website clearly indicates
a central focus on the internationalization efforts as well a commitment to being reputable
internationally. For example, CU’s “Vision for 2030” is to be a recognized international leader
in research and education. The university’s website also touts its current reputation as a
“university with a global outlook.” That CU was providing programs to over 10,000 international
students in onshore and offshore programs at the time of this study is clearly an ownership
advantage that allowed it to more aggressively pursue market entry in Vietnam.
CU’s internationalization experience meant that it had a more flexible and open
perspective on offering programs offshore. As one faculty member noted, “CU’s years of
international experience made them very comfortable in starting more offshore partnership
programs.” CU’s internationalization activities were heavily focused in the Asia region. CU’s
broad experience in Asia meant it had already gained extensive familiarity with the Vietnam
market. Once Kirkpatrick initially proposed this program, CU carefully analyzed the Vietnam
market and was able to identify a growing target market of students and conclude that the
master’s program would fill a definite need. CU’s faculty members were also familiar with the
government of Vietnam; one mentioned during the data collection that “the higher education
environment in Vietnam is beneficial to outside providers because the local government and
EXAMINING MARKET ENTRY STRATEGIES 74
education authorities are encouraging the increase in higher education capacity.” Having faculty
members with experience in the region allowed CU to recognize that Vietnam’s open stance
toward Western education providers made it an ideal place to offer CU’s offshore program. In
addition, CU had wide-ranging experience in selecting local partners, which allowed them to
filter the key characteristics that would make RELC and RETRAC appropriate local partners.
As will be discusses later in the chapter, some important characteristics CU felt that RELC and
RETRAC possessed were their close ties to local government, their breadth of experience in
partnering with Western universities, and a local marketing expertise that helped attract
prospective students.
Capacity to handle international expansion. Another ownership advantage that CU
possessed was its capacity to handle international expansion, which in turn contributed to its
ability to evaluate potential programs. With experience running offshore programs in several
countries, CU had a process in place for evaluating whether a proposed program offering would
be successful. CU’s International Office evaluated each potential offshore program for financial
viability and for the program’s fit in the global strategy of the university. In addition, each
potential local partner was assessed, in accordance with the Collaborative Education Services
policy of Curtin University. This policy was an assessment check that all potential partners (or
collaborators) must go through. This involved examining a potential partner’s governance
structures, management capabilities, financial resources, and quality management systems. Its
experience and background in partnering with foreign institutions enabled RETRAC to pass
these evaluations. RETRAC was chosen as a CU partner also because it was a part of SEAMEO,
a stable and well-respected organization. Several respondents spoke very positively about CU’s
administrative capacity to evaluate potential partnership opportunities thoroughly and carefully.
EXAMINING MARKET ENTRY STRATEGIES 75
CU was also able to ensure the academic integrity of an offshore program. Quality
assurance is one of the most challenging issues in operating such programs. Because it had
previous experience monitoring programs abroad, CU was able to guarantee that the quality of
education being delivered was comparable to its onshore programs. More details on CU’s
quality assurance measures will be discussed later in this chapter.
CU identified the unique location characteristic and market advantage of Vietnam in its
inherent appeal the country held for CU faculty. As one administrator pointed out, Vietnam is a
popular Asian vacation destination for Australians. CU faculty members in the Humanities
Department were already keen to teach in an offshore program because of their desire to support
the internationalization of CU programs; but the attractiveness of Vietnam increased their
motivation. The capacity to send teachers thus served as a key feature on the administrative side.
Kirkpatrick had this component in mind when he initially proposed this program to faculty
members. Likewise, as Toni Dobinson, a professor involved in the early stages of the
partnership, noted, “Several of the instructors were quite excited about the prospects of teaching
in Vietnam.” This illustrates the importance of faculty buy-in. Having the support of the faculty
to launch the program in Vietnam was a significant ownership advantage that CU tapped into.
In possessing the infrastructure for international expansion, CU knew that offshore
programs required less work and preparation because certain processes were already in place.
Another great example of its built-in capacity was CU’s admissions process. The admissions
process could have presented significant challenges, because prospective students often reside
quite far from the centralized admissions office in Australia. CU had an efficient process in place
for admissions and knew exactly what it had to do and what duties it required of its partners. As
such, students applying for admission to CU Vietnam were able to receive timely admissions
EXAMINING MARKET ENTRY STRATEGIES 76
decisions even though admissions approvals came from Curtin’s Humanities International
Marketing Office (HIMO) in Perth, Australia.
Negotiation expertise. As mentioned by several staff and faculty members, crucial skills
for international expansion include the ability, experience, and expertise to negotiate terms with
local partners. CU’s previous experiences in developing offshore programs gave it an advantage
in negotiating partnerships with RELC and RETRAC, allowing it to handle the process in a
simple and straightforward way. CU’s negotiation strategy meant it knew precisely what points
to emphasize, what requirements to demand of its local partner, and what concessions it would
accept. RELC’s and RETRAC’s previous experiences with foreign partners also helped make the
negotiation process run smoothly. Interviews with administrators of CU and RETRAC indicated
that they were both were very pleased with the major points of the finalized agreement, such as
allocation of duties for each partner and financial compensation figures. The advantage of
utilizing one of the main strengths of CU—its capacity for international expansion—was quite
evident during the initial negotiation process because CU knew very clearly how to structure the
partnership agreement to its liking.
Emerging market of Vietnam. Examining the decisions CU made during the process of
entering the market of Vietnam, the researcher noted that several characteristics of the target
country clearly affected its market entry strategy. According to the OLI-Framework, location
advantages are a critical factor in how to enter an overseas market. It states that a firm should
carefully consider the major features of the target location, such as market potential, level of
investment risk, and governmental attitudes toward foreign companies (Dunning, 1988).
Interview data revealed that the emerging market of Vietnam held several location advantages,
such as its steadily growing economy, the motivation of local partner SEAMEO RETRAC to
EXAMINING MARKET ENTRY STRATEGIES 77
internationalize—and its strong willingness to partner with a foreign university like CU—and
increasing student demand for a Western education. These location advantages motivated CU to
enter this market and guided many of its decisions throughout the process. The unique
characteristics of Vietnam, its potential partners, and its prospective student population—and
how they impacted the market entry strategy of CU—will be discussed in the following section.
Growing economy. A recurring theme throughout interviews with CU administrators and
faculty members was Vietnam’s market potential. Several interviewees mentioned that Vietnam
was a “hot market to attract international students.” The appeal of the Vietnam market definitely
contributed to the decision to offer the master’s program there. As Dunning (1988) has
mentioned, a clear location advantage was the growth potential of the local market, which
Vietnam clearly exhibited based on its substantial yearly economic growth at the time. Vietnam
was seen as a positive entry market because of its population growth and the noteworthy increase
in foreign companies entering the marketplace in recent years. One respondent mentioned that
Vietnam was considered the “number one market in Southeast Asia.”
Grossly underserved market. Vietnam’s higher education system is already at full
capacity, making it extremely difficult for students to attend local colleges because they must do
well on national exams to get accepted after finishing high school. One respondent explained
that it is very difficult to attend a public university unless you are an exceptional student. The
hurdles are quite challenging even at the bachelor’s level, and the master’s programs are even
tougher to gain acceptance into.
Government attitudes. Another location advantage of Vietnam was the Vietnamese
government’s attitude toward a potential foreign university entering its market. Vietnam’s
Ministry of Education and Training (MOET) expressed an eagerness to increase access to higher
EXAMINING MARKET ENTRY STRATEGIES 78
education for its citizens. One respondent mentioned that during the initial market entry process,
MOET had passed several decrees aimed at encouraging foreign universities to offer offshore
programs in Vietnam. Moreover, in recent years, corporate regulations regarding direct foreign
investment had become less stringent. Governmental authorities in Vietnam, as one faculty
member expressed, wanted more schools to come to Vietnam in order to increase the English
language capacities of its people. The government’s growing desire for its citizens to acquire
English language skills meant more English teachers were needed; thus, MOET was more likely
to endorse CU’s Master of Arts in Applied Linguistics program because it provides teachers with
English language instruction. This location advantage guided CU’s decision to offer the MA
program with RETRAC in Vietnam.
Reach of SEAMEO. Of the several location advantages in the emerging market of
Vietnam, one of the most important was the credibility and experience of CU’s local partner,
RETRAC. As mentioned previously, RETRAC is part of SEAMEO, a well-respected multi-
lateral government organization connected across the Southeast Asian region. These alliances
meant that RETRAC had existing relationships with other regional chapters of SEAMEO, such
as RELC in Singapore. The affiliation between RELC and RETRAC was a key factor in getting
CU Vietnam initially established. The agreement began as a formal relationship among all three
organizations (CU, RETRAC, and RELC). In addition to its broad reach in the region, SEAMEO
RETRAC had a close relationship with MOET. Furthermore, CU faculty explained that
RETRAC’s attitudes toward higher education were similar to those of the Vietnamese
government, which had great interest in bringing in more Western education opportunities.
Increasing market demand. Vietnam’s rapidly growing market was a prominent location
advantage that CU wanted to exploit to increase its presence in the region. The supply of local
EXAMINING MARKET ENTRY STRATEGIES 79
public and private colleges was scarce—and continues to be so today—compared to the total
number of high school graduates. A faculty member who had traveled to Vietnam several times
mentioned the country’s dire need for more colleges and universities, and that the influx of
foreign providers of higher education was still not sufficient to meet market demand. Also
noteworthy is that students in Vietnam prefer a Western higher education to the education
provided by local public universities. This partiality offers a significant advantage to Western
institutions like CU and motivated CU to make a significant commitment to setting up CU
Vietnam.
Another factor that increased market demand was the availability of government
subsidies. Many potential students worked, at the time, for the government of Vietnam, and
substantial government subsidies were available for students wishing to attend CU Vietnam’s
master’s program because of government appreciation and support of programs that increase
English language skills. According to one faculty member, several students mentioned that
paying lower tuition for the program was a huge incentive for entering the program.
Governmental financial support for education clearly increased the demand for the types of
programs CU Vietnam planned to offer. For its part, CU recognized that government financial
assistance would serve its efforts to recruit students for the program.
The student demand factor that bore the greatest influence on CU’s decision to enter the
Vietnam market was its awareness of an already sizeable population of students eager to enroll in
the proposed master’s program. This demand was a direct result of the existing partnership
between RETRAC and RELC of Singapore. As mentioned previously, RELC had been offering
a graduate diploma in Applied Linguistics since 1998 with RETRAC in Vietnam. That the
program CU planned to offer in Vietnam accepted the units from RELC’s diploma program as
EXAMINING MARKET ENTRY STRATEGIES 80
transfer credit increased the likelihood that graduates would want to enroll in CU’s Master of
Arts in Applied Linguistics program. Along these lines, David Wood mentioned, “CU was
anxious to offer this program because we knew there were plenty of RELC diploma graduates in
Vietnam that would have strong interest to apply to our program.”
Focus on academic integrity. Throughout the data collection process, the researcher
noted a persistent focus on having quality standards in place to ensure the academic integrity of
the program in Vietnam. The majority of the respondents spoke very proudly about how the
academic rigor of the program at CU Vietnam was equivalent to that of the program at the home
campus. Wood and Kirkpatrick, along with several faculty members, spoke about how the initial
negotiation of the curriculum stipulated regular quality control and assessment throughout the
program—which included regular trips to Vietnam by the CU program coordinator to observe
and evaluate the delivery of the courses by all faculty members, including RELC instructors.
Grades were also checked for consistency by reviewing samples of student work. That
RETRAC welcomed and encouraged this type of oversight and monitoring by CU was a positive
sign to CU leadership that both partners concurred on the importance of quality assurance.
A prime example of CU’s quality assurance focus is the thorough process potential
partners must undergo to become approved partners. Every partner is evaluated through CU’s
Collaborative Education Services Policy, which is in place to ensure that offshore operations
with a partner are established and maintained in accordance with Curtin University’s
commitment to high quality academics. Potential partners are evaluated based on their ability to
ensure that the proposed program will be comparable in quality to programs delivered in
Australia. This is evaluated through a potential partner’s business plans, financial statements and
forecasts, quality assurance checklists, and legal and compliance reports.
EXAMINING MARKET ENTRY STRATEGIES 81
A clear theme throughout interviews was the importance of assuring that all partners—
including SEAMEO—uphold the academic integrity of the programs. Quality was ensured
through both annual audits of the each offshore program as well as regular "moderation checks"
by Curtin faculty regarding all grades assigned and student work submitted. The CU program
coordinator would examine student work to ensure consistency in quality of work submitted by
students and grading assigned by faculty members. Curtin faculty from the home campus taught
half the program offered in Vietnam, which meant that at least half of the courses had a
guarantee of quality. CU closely monitored the other half of the program—which consisted of
courses taught by RELC instructors. As mentioned previously, CU currently teaches five of the
courses whereas RETRAC teaches three of them. CU’s extensive experience monitoring
offshore programs was a huge advantage to ensuring that the program was being delivered
according to its high standards.
Dunning (1988) referred to the “internalization advantages” of a firm as its ability to
“internalize” operations abroad for services being offered. Understanding what parts of the
operation can be offered and controlled by a firm entering a foreign market is crucial. CU is able
to internalize a sizeable portion of the course delivery by sending faculty to teach half the
courses in the program. As mentioned above, CU is still able to monitor the other half closely
enough to ensure the quality of education and academic standards, which meant it could enter
into the partnership and retain significant control over the delivery of its product, which, in this
case, is the curriculum. CU had the intellectual property and was able to firmly monitor and
protect its brand. The ability to minimize the risks associated with the possible misuse of
proprietary knowledge—and the costs of protecting it—gives a firm or university a tremendous
EXAMINING MARKET ENTRY STRATEGIES 82
advantage in negotiation. CU recognized this advantage and was able to propose a program
structure and curriculum that fully met its desired goals.
Research Sub-Question 2
How did the competitive marketplace in Vietnam affect the market entry strategies
of Curtin University?
In examining the competitive marketplace in Vietnam, this study identified several
related factors that affected CU’s market entry strategy, most of which related to the unique
location advantages Vietnam possessed. Dunning’s (1988) OLI-Framework outlines location
advantages as factors directly relating to the market growth potential of the host country. CU
recognized and utilized Vietnam’s vast growth potential through several key features of the local
marketplace. This section will critically analyze the advantages of Vietnam’s local marketplace,
including its competition, overall higher education market, potential local educational partners,
and desires and perceptions of the prospective target students. Curtin’s ability to compete in the
competitive marketplace, in light of these factors, will also be discussed.
Effects of emerging market of Vietnam on competition. Analyzing the overall market
and its competition is crucial to assessing a given marketplace. As previously noted, the
majority of respondents mentioned that the vast potential of the overall growing market of
Vietnam was a key benefit of establishing an offshore program there. The country’s general
economic climate is receptive and encouraging to Western universities seeking to offer programs
to local students. This climate is ideal for foreign universities looking to enter the market
because regulations are less stringent, and the barriers to entering the market are low. But low
barriers to entry can lead to increased competition, as many universities seek to reap the benefits
of globalizing their programs (Dunning, 1988). Notably, Vietnam has its own motivations in
EXAMINING MARKET ENTRY STRATEGIES 83
generating an amenable environment for such education programs: developing and mobilizing its
intellectual capital. A number of Western universities entered the Vietnam market during this
period, although total numbers of foreign universities active in Vietnam remains low at about 30
(Ministry of Education and Training, 2009).
Current competitors in the market. When first considering entering Vietnam, CU had
already conducted extensive analysis of the local market and of the costs involved in importing
the program across national borders. CU carefully studied the competition in Vietnam to ensure
that the new venture would be financially viable and would fit with CU’s internationalization
strategy. Several members of CU staff mentioned the institution’s strong emphasis on increasing
offshore programs but also explained that each program needed to be financially sustainable in
its own market. This requirement meant that examining the competitive landscape was an
absolute necessity, as David Wood mentioned several times in his interview. Specifically,
Professor Kirkpatrick stated that CU had looked carefully at what programs were being offered
in Vietnam, and by which universities. From his research, Kirkpatrick found no competitors
offering a program comparable to what CU wanted to offer in Vietnam. Indeed, CU was one of
the few universities offering a Master of Arts in Applied Linguistics from a Western institution,
and the first to have instructors from the home campus fly in to teach part of the program.
Moreover, Professor Paul Mercieca mentioned that only a few universities—such as RMIT of
Melbourne, Australia, and the University of New South Wales—offered similar programs in
Vietnam, but they were not specific to linguistics like CU’s program.
Access, communication, and proximity were also crucial factors. In addition to being one
of the few universities in Vietnam offering an MA Linguistics program, Professor Dobinson
mentioned that CU had a geographic advantage because its home campus was located in Perth—
EXAMINING MARKET ENTRY STRATEGIES 84
on the west coast of Australia—rather than on the east coast, in Melbourne, like its competitor,
RMIT. This more proximate location meant that CU and RETRAC were in the same time zone,
thus facilitating collaboration. Scheduling phone conferences or answering email was much
simpler for faculty, staff, and students involved in CU Vietnam, allowing them to interact with
each other and to continue dialogues beyond the classroom setting. This convenience bore out
when CU faculty members flew back to Australia after delivering a course and wanted to
correspond with students in Vietnam. It also made a big difference when the staff of CU Vietnam
wanted to communicate with their counterparts in Australia regarding important issues like
admissions decisions.
Additionally, flights from Perth are significantly less expensive than flights from
Melbourne. Having the home institution in Perth served as a substantial location advantage for
CU, affording the flexibility to send instructors from the home campus to teach at CU Vietnam.
As Mercieca mentioned, RMIT utilized a different model, hiring more instructors based in
Vietnam, because flying teachers in from Melbourne, Australia, was too costly.
Availability of strong partners. While analyzing the competitive landscape of Vietnam,
several senior leaders of CU emphasized the importance of having strong partners when entering
a new market. Senior leaders explained that CU’s strategy was to invest less in its own brick-
and-mortar facilities and more in collaborating with local partners. CU sought local partners who
were easy to work with, had experience working in joint programs, were strong in marketing to
prospective students, and had sufficient facilities to operate the program. Fortunately, they knew
that RETRAC was strong in all of these areas. As mentioned previously, RETRAC had
extensive familiarity with partnership programs with other universities offering programs to local
EXAMINING MARKET ENTRY STRATEGIES 85
students. This know-how provided a competitive advantage over other possible local partners
and was a factor in attracting CU to pursue a partnership with it.
Another positive influence on the potential partnership at the time was RETRAC’s
expertise in marketing and recruiting. For instance, one of the most important considerations in
entering a new market is assuring that the proposed program can attract enough students to help
sustain the program financially, especially in the early stages of a new program. Although this
effort was greatly served by the amount of interest CU knew it would have from the RELC
graduate diploma students, CU also knew that RETRAC was quite adept at marketing. Several
faculty members who taught in the program commented on RETRAC’s great track record in
Vietnam—with numerous successful Western universities as partners due to its expertise in
promoting name recognition, raising profiles, and establishing solid reputations, all of which
inevitably increases enrollment in the institutions. CU also knew that RETRAC had the
marketing capability to sustain several programs already in place, so it felt confident about
launching a new program with it. During data collection, several respondents stressed the
importance of this advantage, explaining how comfortable CU was in establishing a joint
program with RETRAC, believing that the alliance would be an enduring one.
Potential market size. When examining competitive environment factors that affect
strategy and decision-making, looking closely at the potential students for the proposed program
is imperative. As David Wood and Simon Ridings mentioned, examining immediate demand for
a program is crucial, but so too is ensuring that a steady flow of students is ready to enroll for the
long term; such was the case when CU examined the market. Although the marketplace was
seeing increasing competition, the volume of students demanding higher education was so
substantial that the supply of higher educational providers—although mounting at the time—still
EXAMINING MARKET ENTRY STRATEGIES 86
did not meet the demand of local students. This finding closely corresponds with the
aforementioned description of the emerging market of Vietnam, whereby the economy’s
continuous growth in recent years had been driving the demand for more higher education, thus
promoting initiatives and cultivating a receptive environment to active partnerships between
local entities and universities abroad. Simon Ridings mentioned that before entering any new
market, CU thoroughly researches and conducts analysis of the demographics of the potential
students. Examining the local market made CU more likely to make the decision to partner with
RETRAC because CU’s research showed sufficient student demand for the program.
Curtin University’s differentiating strengths. As mentioned previously, CU conducted
extensive market analysis prior to entering the market of Vietnam, looking carefully at existing
joint programs between Western universities and local partners. By analyzing the competition,
CU identified a gap in programs that were contextually sensitive to the local environment. For
instance, Andy Kirkpatrick mentioned the need to customize offshore teacher training programs
to local Asian conditions. Similarly, Paul Mercieca noted that one error made by many other
Western universities was importing the curriculum from the home location without tailoring it to
the offshore environment. This openness and flexibility considerably strengthened CU,
impacting its curriculum design for the eventual master’s program at CU Vietnam.
CU revised the curriculum, ensuring it was customized for students living in Vietnam and
tailoring it to be directly relevant to the students and their working environment, as many of
them were training to become professionals in language teaching in Vietnam. As another faculty
member commented, the program in Vietnam was developed to have direct significance for the
English teachers in the program—yet another benefit of working with a great partner like
EXAMINING MARKET ENTRY STRATEGIES 87
RETRAC. Collaborating with RETRAC was simple because of its deep familiarity with the local
market and insight about what the students valued in a master’s program.
Customized Curriculum. One emphasis in the curriculum was on meeting the students’
desires to have a convenient and quality education. CU addressed issues of quality by creating
and offering a localized and relevant curriculum to local students. In addition, having instructors
from the home university teach the program was a meaningful differentiating strength for CU.
Students were eager to have live lectures in-person with Curtin instructors because they value
close interactions and relationships with faculty. The convenience of the program also served as
a significant incentive for students to enroll in the program. CU was able to design a program
that met the scheduling needs of the students. As Toni Dobinson expressed:
One strength was offering a program that was convenient for working adults and those
living in remote areas. Some teachers have two jobs, so they’ll do the government
teaching job and then they’ll go off at about 4:00 or 5:00 o’clock to do working private
language school maybe up to 10:00 at night.
The decision to offer a more convenient program was based on market research. As discussed
earlier, CU proposed a curriculum that required students to go to class in person only one week
at a time for each course. Because CU’s target market was English teachers, its goal was to
create a program that was flexible and would maximize their time off. This aspect was highly
attractive to prospective students because they did not have to take much time off from work,
and the curriculum offerings fit their busy schedules.
The Curtin University Test of English. Another decision driven by the competition was
CU’s choice to offer its own English proficiency exam. One of the biggest challenges in the
marketplace was the English proficiency level of the students. All prospective students must
EXAMINING MARKET ENTRY STRATEGIES 88
prove their English abilities for the program by taking a standardized exam like IELTS or
TOEFL. So another way that CU distinguished itself from the competition was by administering
its own English proficiency exam, called CUTE, or Curtin University Test of English. Taking the
CUTE was more convenient than taking other exams like the IELTS, which other competitors
require. As several faculty members expressed, the local students found the admissions
processes at other universities to be quite onerous, so CUTE eliminated one important step for
prospective students, a well-received modification.
The competitive marketplace bore a significant influence on the decisions CU made
throughout the market entry process. Market research results gathered by CU regarding the
competition, the potential local partners, and the target market of prospective students drove
many of their decisions regarding curriculum, program structure, and partner selection. CU
chose RETRAC as a partner because of its expertise and experience in partnering with Western
universities. CU’s curriculum content was unique and relevant to the professional needs of local
students. In addition, CU created a very flexible program that easily complemented the
schedules of students and kept its quality high by having CU instructors teaching it.
CU was able to exploit many of Vietnam’s location advantages by recognizing its unique
characteristics and utilizing them. Dunning (1988) has described the main location advantages
of the OLI-Framework as a target country’s economic growth trend and market size potential.
For CU’s purposes, the specific advantages in Vietnam’s economic and market potential include
limited competition, valuable local partners, and a steady flow of present and future student
populations.
CU conducted a close study of all factors, securing a strong local presence, assessing the
climate of competition, and assuring attentiveness to the local culture and the specific needs of
EXAMINING MARKET ENTRY STRATEGIES 89
the student population. Moreover, CU recognized that Vietnam’s receptivity to its program and
the student demand for higher education would make a perfect fit with the advantages of the
services it had to offer in terms of expertise, established curriculum, and high quality staff.
Research Sub-Question 3
How did the regulatory environment of Vietnam's higher education sector affect the
market entry strategies of Curtin University?
Examining the regulatory environment of Vietnam’s higher education sector revealed
several factors that affected CU’s market entry strategy. The attitudes of the Vietnamese
government, including those of the Ministry of Education and Training, shaped many of the
decisions CU made during the market entry process. The majority of the findings suggested that
the government had a more accommodating and welcoming attitude toward foreign direct
investment and foreign providers of higher education in particular. Dunning’s (1988) OLI-
Framework focuses on market potential as a primary location advantage, but also stresses that
this factor should be evaluated in the context of the target country’s political climate. The
government of Vietnam exhibited a welcoming climate for Western providers of education by
promulgating regulations that would expand foreign direct investment in higher education by
foreign universities. Data collected in interviews with the staff and faculty of Curtin University
showed that Vietnam’s regulatory environment greatly affected many decisions made by CU,
including country selection, local partner selection, and program structure.
Regulatory environment of Vietnam. When examining the regulatory environment and
its effect on CU’s market entry strategy, several key related areas must be considered—among
them, the different government bodies of Vietnam and their attitudes toward foreign investment
in education, recent regulations or decrees set forth by the Vietnamese government, and the local
EXAMINING MARKET ENTRY STRATEGIES 90
partner’s ability to help navigate this unique setting. These key areas regarding the regulatory
environment of Vietnam emerged from the data analyzed through the interviews. Several staff
members of CU mentioned how Vietnam was an ideal country market to target based on the
government’s attitude about encouraging foreign direct investment. Deputy-Vice Chancellor
David Wood mentioned that entering the Vietnam market at that time was ideal because the
government highly encouraged foreign universities to invest in the country. Wood further
mentioned that his team ultimately chose to expand in Vietnam, instead of China or another
country, because its internal market research showed that Vietnam was more open to foreign
providers of education. CU prioritized that investments in a new offshore program would not
waste resources and that its efforts would ultimately be fruitful. This aim made it extremely
important that a new program be approved to launch and not be held up by regulatory issues.
The Vietnam government’s mandate to increase the capacity of higher education by 2020
generated an advantageous political climate for CU. As Professor Paul Mercieca mentioned,
Vietnam’s higher education market is grossly underserved. This reality meant that MOET would
create rules and regulations that would encourage more foreign universities to offer programs in
Vietnam and increase the higher education capacity in the country. Professor Kirkpatrick
mentioned that the rules on foreign direct investment were becoming less stringent, making it
easier for foreign universities like CU to invest in Vietnam’s higher education market.
Kirkpatrick further noted CU’s recognition that laws regarding investment and corporate
ownership had become more relaxed in recent years.
In addition, in the government of Vietnam was in midst of launching an initiative focused
on raising the English proficiency level of all its citizens. Wood mentioned this key point:
“English is very important to the country, Vietnam is moving towards a situation where it seeks
EXAMINING MARKET ENTRY STRATEGIES 91
to teach as much of the English language as it can” to its population. This reality made offering
an MA in Applied Linguistics ideal, as the central purpose of the MA in Applied Linguistics is to
train English teachers to more effectively teach English. Professor Dobinson noted that Vietnam
was considering requiring all English teachers to have master’s degrees, pointing out that this
mandate would make it easier for CU to offer its MA in linguistics. CU’s MA program in
Applied Linguistics would directly contribute to increasing the capacity of the English language
by educating local English teachers.
CU also compared entering Vietnam to entering the markets of other countries. For
instance, Professor Mercieca mentioned that Vietnam regulations were much easier to “crack”
than those in a country such as China. He explained that Vietnam had fewer regulations to
negotiate in terms of setting up a program and dealing with joint ventures. Wood echoed these
comments, explaining that Vietnam was a natural partner because of its strong push to increase
the capacity of higher education. CU’s strategy was to target a country that was open and willing
to accommodate foreign universities and to offer a program that local students needed but that
was also heavily supported by the local government.
Strong partner: SEAMEO RETRAC. Vietnam’s regulations regarding international
branch campuses are quite vague and complicated. Thus, rather than encouraging international
branch campuses to establish themselves there, Vietnam encourages foreign universities to
partner with local institutions, which was one reason that CU decided to run the MA program
through a partnership with RETRAC. Although the government ultimately supports programs
like the one offered by CU Vietnam, schools still have to face considerable bureaucracy during
the market entry process. By partnering with RETRAC, CU did not have to navigate the
regulatory system on its own. The regulatory environment was a key reason that CU chose to
EXAMINING MARKET ENTRY STRATEGIES 92
partner with RETRAC. Professor Merceica expressed that a major benefit of choosing RETRAC
as a partner was because of the latter’s close relationship with MOET. RETRAC’s strong
alliance with MOET facilitated processes such as getting government approvals and licenses. As
Professor Dobinson also mentioned, having the right partner would lessen the challenges of
dealing with the government of Vietnam. CU understood that partnering with RETRAC would
help the process run more smoothly in the long run, as it was RETRAC’s responsibility to deal
with the government, while CU focused more on the academic side of course and curriculum
delivery.
In addition, CU Program Director Simon Leunig cited some minor requirements that
would slow the process—such as having contracts in both languages—but explained that,
overall, Vietnam was much more efficient than other countries. Wood also explained that
RETRAC’s good reputation in Vietnam probably helped move things along more quickly. CU
ultimately agreed to partner with RETRAC because it understood that, given the local regulatory
environment, having a strong partner was critical.
Ultimately, before entering the Vietnam market, CU made informed and calculated
decisions about planning, operating, and evaluating an offshore campus. Considering entry from
international and local angles, assuring quality of education delivery by using seasoned Curtin
faculty, having established communication and support systems and strategies, and entering
partnerships that facilitated the navigation of Vietnamese regulations and legislation all went far
in offering CU’s program to an eager student market.
Overarching Research Question
This case study sought to answer the following question: What was Curtin University's
market entry strategy for expanding into Vietnam, and how was it implemented? Answering this
EXAMINING MARKET ENTRY STRATEGIES 93
research question required study across multiple fields of inquiry. CU had to formulate an
extensive strategy before entering the Vietnam market so that implementation would take place
as efficiently as possible. Although its own previous experience in developing education links
smoothed its entry into Vietnam, CU certainly had to contend with unique location-specific
challenges. Even institutions seasoned in forging these partnerships have a steep learning curve
when seeking to establish themselves in unchartered international territory.
Any institution seeking to establish an international program must consider the
expectations, educational needs, bureaucratic and political climate, and cultural particularities of
the potential host county. Host countries want access to education from established and
prestigious institutions that can guarantee academic quality, whereas foreign institutions want to
increase enrollment, promote and facilitate educational opportunities, and develop new revenue
sources. For both entities, the entry strategy involves managing a complex mixture of
government regulations, business interests, and education delivery strategies, which inevitably
presents some challenges.
In this case study, Vietnam was looking to fortify its workforce and to increase the
availability of English language education (which could ultimately serve some its own economic
goals), whereas CU was primarily interested in expanding its internationalization efforts into an
emerging market. A crucial early step in CU’s approach was forging valuable partnerships that
allocated expanded academic offerings to one side and infrastructure and facility support to the
other. Together, these partnerships sought to meet the demand for higher education. Also
fundamental to CU’s method was careful study of the demographics, politics, and established
educational offerings of its new environment. By making sure it had productive alignment with
EXAMINING MARKET ENTRY STRATEGIES 94
Vietnam, CU was able to promote and import the strengths of its unique program and to leverage
the strengths of its home faculty to create a viable program.
Conclusion
Document analysis and participant interviews with 13 key administrative and faculty
members of Curtin University provided rich data to analyze and formulate findings for this
qualitative research study. The overarching research question regarding Curtin University’s
strategy behind the market entry process and its implementation was answered by the findings
triangulated through the 3 sub-questions. The process that Curtin University undertook to offer a
unique offshore program in Vietnam required CU’s senior leaders to make several key decisions
in selecting their market entry strategy. Dunning's (1988) OLI-Framework provided a theoretical
lens through which to examine the different factors and advantages that affected CU's strategy.
CU clearly held various ownership advantages that served it well while establishing an
offshore program in Vietnam. CU's expertise in internationalization and its experience with
offshore programs allowed it to take more risks. The location advantages of Vietnam's growing
economy and emerging market were key factors that guided CU's decision-making as well. In
addition, CU’s ability to ally with SEAEMO RETRAC cultivated a prosperous partnership
because CU was able to take advantage of RETRAC's local expertise and close relationship with
MOET. Finally, the internalization advantages that CU was able to leverage included its ability
to maintain a high-quality learning environment similar to that of its counterpart in Australia.
CU's experience and expertise in international higher education allowed it to internalize many of
its offshore operations and to recognize the many unique features of Vietnam from which it
could benefit. Overall, Curtin University’s ownership advantages and Vietnam’s location
advantages highly influenced strategic decisions made by CU staff and faculty behind the market
EXAMINING MARKET ENTRY STRATEGIES 95
entry strategies for the Vietnam market, ultimately facilitating the development of a mutually
beneficial educational opportunity.
EXAMINING MARKET ENTRY STRATEGIES 96
CHAPTER FIVE: DISCUSSION
Through the lens of a qualitative case study of Curtin University’s offshore Master of
Arts in Applied Linguistics program in Ho Chi Minh City, Vietnam, this study examined the
strategies and implementation of a university’s market entry process into a developing country.
The internationalization of higher education has increased significantly in recent years,
particularly in the form of offshore programs being offered by Western universities in emerging
markets like China, India, and Vietnam (Altbach & Knight, 2011). Specifically, Australian
institutions like Curtin University have been very active in the Asia region for some time.
Unfortunately, research has not kept pace in understanding the factors that affect the market
entry strategies of Western universities expanding internationally through offshore programs.
Western universities, American institutions among them, are increasingly looking to add a
revenue stream by becoming more active abroad; however, entering a new target country market
can be quite difficult. Many challenges may arise during the market entry process, such as
understanding the local competitive marketplace and navigating the complex regulatory
environment. The purpose of this study was to examine the strategies behind Curtin University’s
market entry process in Vietnam to inform other universities facing similar decisions to
internationalize in Vietnam. The findings from this study will help foreign institutions recognize
and be better prepared to deal with different factors that are involved with entering a foreign
higher education market.
Summary
Chapter One provided a synopsis of and context for offshore educational programs,
elucidating the dearth of studies on university foreign market entry strategies. The chapter
enumerated motivations for expanding programs internationally, including the need to build a
EXAMINING MARKET ENTRY STRATEGIES 97
global brand presence as well as to cultivate an additional revenue stream to strengthen a
university’s finances. A foreign market entry strategy requires a university to make many key
decisions. Most frequently, strategies involve choosing the mode of market entry that makes the
most sense for the institution. The two most popular and resource-intensive modes of market
entry a university may engage are establishing a branch campus or partnering with a local
institution to offer the offshore program (Armstrong, 2007). Other important decisions include
assessing the type of students the university should target, selecting the appropriate local
institution with which to partner, and optimally structuring a proposed offshore program. The
process a university faces in entering a new market in a developing country can be quite
complicated; therefore, understanding the strategy behind the various decisions involved can
offer constructive and replicable lessons. To this end, this study closely examined the method
Curtin University engaged in setting up an offshore master’s program in Vietnam.
Chapter Two provided further background on factors affecting market entry strategy by
looking more deeply into the literature surrounding this topic. A more complete picture of a
foreign market entry strategy was presented through a review of literature pertaining to key areas
of the internationalization of higher education, including major factors in organizing offshore
programs, types of such offshore programs, and the rationale and motivations behind foreign
market entry. Chapter Two also thoroughly examined Vietnam’s higher education market,
especially recent regulations surrounding the investment and expansion of foreign universities in
the local market. Australia’s history of internationalization by many of its universities was
discussed to provide a context for Curtin University’s breadth and depth of experience abroad. A
review of the literature indicated that little research had been conducted on the foreign market
EXAMINING MARKET ENTRY STRATEGIES 98
entry strategy of universities. As such, this chapter also looked at research from business
literature that has addressed the foreign market entry strategy of organizations.
Dunning’s (1988) OLI-Framework served as the theoretical framework for this study.
Dunning’s framework discusses the location advantages, ownership advantages, and
internalization advantages that affect market entry strategy. Because myriad factors impact how
an offshore educational program can be established, the need for a study focused on
understanding the strategies behind a university’s foreign market entry strategy was significant.
Chapter Three explained how the researcher utilized Curtin University Vietnam as a
qualitative case study. The qualitative research method is ideal for a case study because it helps a
researcher probe and gather in-depth data more effectively and to better facilitate a
comprehensive analysis of findings (Patton, 2002). Data from 13 interviews with Curtin
University’s staff and faculty were synthesized to determine emerging patterns and themes that
helped explain its market entry strategy. Data were coded and analyzed according to Dunning’s
(1988) OLI-Framework on foreign market entry, which emphasized the ownership advantages
(O) Curtin University possessed during the market entry process, the location advantages (L) and
unique benefits offered Vietnam, and the internalization advantages (I) Curtin’s was able to
assume regarding the operations overseas.
Research Questions
Chapter Four discussed the findings with respect to each of the study’s research
questions. Data collected from the interviews and documents were analyzed through the OLI-
Framework and explained through relevant ownership advantages, location advantages, and
internalization advantages. The findings for the research questions are answered below,
according to the themes that emerged from the analysis.
EXAMINING MARKET ENTRY STRATEGIES 99
Overarching Question
What was Curtin University's market entry strategy for expanding into Vietnam, and how was it
implemented?
Research Sub-Question 1
1. What factors shaped Curtin University's market entry strategies for expanding
into Vietnam?
Curtin’s internationalization experience and expertise in setting up offshore programs
guided many of its decisions during the market entry process. Prior experience in offering
offshore programs throughout Asia allowed it to make informed decisions regarding its mode of
market entry, partner selection, and program structure. Curtin University also had extensive
knowledge of how to build key relationships and negotiate the terms of an agreement, which
served it well during the market entry process. Another factor in Curtin’s strategy was its ability
to recognize the location advantages of Vietnam’s growing market, its open and collaborative
local partners, and the country’s increasing student demand. All of these features contributed to
Curtin’s decision to choose SEAMEO RETRAC as a local partner in Vietnam and to offer a
convenient program to local students who appreciated the flexibility of the program. Curtin
University’s ability to internalize many aspects of the operations overseas also influenced market
entry strategy. The university was able to send faculty abroad to teach half of the course
offerings in Vietnam and to put quality control measures in place to maintain a level of academic
standards comparable to its home campus. Crucial to market entry was Curtin University’s
capacity to expand internationally, to staff programs itself, and to monitor programs sufficiently.
Moreover, CU had extensive experience on both the academic and administrative side of running
an offshore program.
EXAMINING MARKET ENTRY STRATEGIES 100
Research Sub-Question 2
2. How did the competitive marketplace in Vietnam affect the market entry
strategies of Curtin University?
For Curtin University, one of the most significant characteristics of Vietnam’s local
marketplace was its lack of competitors. Very few programs resemble Curtin’s Master of Arts in
Applied Linguistics; moreover, other programs available to local students targeted students
interested in going to school full time. These competitive factors guided Curtin’s strategy to
pursue students who were working as full-time English teachers and would value the
convenience of studying while employed. Catering to working professionals, Curtin launched an
accelerated and flexible program consisting of four one-week class sessions—a unique program
in terms of format. The availability of strong partners influenced Curtin’s market entry strategy
as well. Because most programs were offered through a local partner, having a colleague such as
SEAMEO RETRAC—with extensive experience in cross-border collaborations—was ideal.
Curtin chose RETRAC, instead of other potential local partners, because it was easy to work
with, had prior experience with partnerships with Western universities, and was strong in
marketing to local students. At the time that Curtin was investigating Vietnam as a location for
its offshore program, Vietnam’s competitive marketplace indicated a growing trend among
students searching for higher education, particularly from Western institutions. Curtin also noted
that the overall market of Vietnam’s students was growing. Increasing student demand,
combined with the lack of higher education providers in the marketplace, presented an attractive
opportunity for Curtin to offer its offshore MA program in Vietnam.
EXAMINING MARKET ENTRY STRATEGIES 101
Research Sub-Question 3
3. How did the regulatory environment of Vietnam's higher education sector affect
the market entry strategies of Curtin University?
The local regulatory environment had a significant effect on Curtin’s market entry
strategy. The government of Vietnam, including the Ministry of Education and Training
(MOET), had adopted a more open and collaborative mindset by establishing policies that
encouraged more foreign direct investment, especially those favoring foreign higher education
providers. The government passed investment laws reducing the requirements for foreign
institutions seeking to invest locally. In addition, the policies regarding foreign universities
offering programs in Vietnam had become less stringent. This more receptive regulatory
environment facilitated Curtin University’s decision to enter the Vietnam market. In all, the
Vietnamese government’s motivation to expand the country’s higher education capacity
contributed to Curtin’s decision to set up an offshore program in Vietnam. In addition, the
government set a mandate to increase both the English language proficiency level of its
population as well the number of qualified English teachers. This directive bore an impact on
Curtin’s decision to offer the MA in Applied Linguistics, which prepares and trains future
English teachers, thus closely aligning with the government’s mandate. In addition, partnering
with SEAMEO RETRAC was appealing because it knew how to tactfully navigate the
regulations based on its close relationships to MOET. RETRAC’s solid reputation in Vietnam
was something Curtin recognized and capitalized on.
Discussion and Analysis of Curtin University’s Market Entry Strategy
Curtin University’s plan for entering the market of Vietnam focused on three major
strategies. The first strategy was to recognize their internal strengths and utilize them
EXAMINING MARKET ENTRY STRATEGIES 102
appropriately. Curtin University’s second strategy was to target a country with an attractive
local market on which it could capitalize. CU’s last strategy was to identify the major challenges
and find ways to mitigate them. The following paragraphs describe in detail the three major
strategies Curtin University utilized during the market process and how it was implemented.
Strategy #1: Recognize its internal strengths and utilize them appropriately:
Curtin University’s first strategy focused on its internal strengths, which include its
abilities, expertise, and capacity to operate an offshore program successfully both
administratively and academically. Curtin demonstrated a strategic model for entry that enabled
it to offer an offshore program featuring curriculum delivery by Curtin faculty who traveled into
Vietnam periodically to teach part of the courses. Although Curtin was able to keep this program
running, sustaining it presented definite challenges. Fortunately Curtin had the capability to do
so. It is worth noting that Curtin administrators mentioned the possibility of expanding into
other major cities in Vietnam, but ran into a barrier in its ability to staff the expansion programs
with qualified professors. This stumbling block offers a valuable lesson for universities looking
to internationalize, indicating the importance of assessing their own capabilities before deciding
how to proceed and what to pursue. Institutions must prudently examine their current operations,
evaluate their capacity to expand, and if they decide to partner, evaluate what responsibilities
they should expect on behalf of the local partner.
Having insight about all of these internal factors before pursuing the partnership was
essential to the overall process—especially the negotiating stage. One of the advantages of the
Curtin University/ SEAMEO RETRAC partnership was that Curtin recognized the experience
that both these institutions had with prior joint educational ventures; this insight helped to
establish clear expectations up front and an explicit delineation of duties. As one senior staff
EXAMINING MARKET ENTRY STRATEGIES 103
member of Curtin mentioned, the negotiation process went smoothly because Curtin knew what
to expect, what to ask for, and what to give up. Knowing how much it could internalize
operations abroad—such as teaching some courses on its own—was a distinct advantage in
Curtin’s negotiations as well. Nonetheless, teaching offshore was not a necessity, but knowing
whether the university had the capacity to do so was crucial.
Along with having the capability and capacity to launch an offshore program, Curtin
University made sure that all levels of leadership supported the mission of internationalization
before moving forward. This support included overall endorsement by the university and, more
importantly, by the head of the International Department, who served as the driving force behind
all new cross-border efforts taken on by the university. Having the administrative leader on
board significantly facilitated the approval and implementation of the offshore program. In
addition, it was important to obtain faculty support for the new offshore program, because
faculty members were responsible for the curriculum and offshore teaching. The key component
was that getting everyone on board decreased any apprehension about expanding internationally,
thus ensuring that the quality of education being delivered abroad was consistent with programs
being offered at the home campus. Quality assurance is imperative, as faculty and university
leaders are always looking to protect the integrity of their academics and of the school brand as
well (Knight, 2006). As such, regular quality checks must be firmly in place. To this end, Curtin
University’s strategy showed the importance of peer and faculty observations and evaluations,
curriculum reviews, and grading moderations taking place at least once a year, if not more.
Curtin University also understood how crucial it was to align the mission of the school
with the objectives of the proposed program. CU knew it was important that everyone at the
university contributes to this goal, as the efforts of many departments are required to ensure that
EXAMINING MARKET ENTRY STRATEGIES 104
such programs run effectively and efficiently. University leadership, faculty, administrators, and
admissions all needed to collaborate for any proposed offshore program to be successful, which
meant that the mission must align with that of the local partner as well. Fortunately for CU,
SEAMEO RETRAC had the same focus on international education and high quality, which
served the partnership well. RETRAC welcomed the quality assurance measures that CU had in
place because it wanted to ensure a credible program for the local students in Vietnam.
Curtin University also realized its strength in cultivating strategic alliances and
relationships. A university wishing to expand abroad must keep this factor in mind in almost
every aspect of foreign market entry. Key to its market entry process was Curtin’s ability to
leverage existing relationships to maximize new ones. Many of its decisions were guided by and
supported through this network, including choosing which country to target and with whom to
partner. One of the main reasons CU chose its local partner was the partner’s close relationships
with the Vietnamese government. Universities looking to engage in cross-border educational
programs must tap into existing relationships, as such connections smooth the progress of market
entry, expediting the process and making it less complicated. Curtin knew that if key
relationships—such as those with potential partners are not available—institutions must cultivate
new relationships and develop them, as CU did when it was first introduced to the leaders of
RETRAC.
Strategy #2: Target a country with an attractive local market it could capitalize on:
Curtin University’s strategy to target Vietnam was based on its growing economy,
increasing need for higher education—particularly English Teacher education—and lack of local
competition. Vietnam was an emerging market that had thrived economically for several years
before Curtin decided to create its offshore program. This climate was significant to Curtin
EXAMINING MARKET ENTRY STRATEGIES 105
because the other choices it was considering at the time were not as favorable. China’s market
was growing, but its regulatory hurdles greatly discouraged Curtin. Other countries in Southeast
Asia that Curtin was considering—such as Thailand and Indonesia—were not growing as
steadily as Vietnam.
Curtin University also recognized that Vietnam’s higher education market was grossly
underserved; lacking sufficient higher education providers to serve its growing population.
Curtin determined that this reality would make it easier to capitalize on this market. The
government of Vietnam encouraged foreign universities to offer programs there, especially those
that would help increase the English proficiency of its people. For this reason, offering the
Master of Arts in Applied Linguistics program was a natural fit. Curtin University’s Linguistics
program prepares students to become English teachers. Because there was a lack of foreign
universities offering similar programs, Curtin University knew that offering its programs would
be very enticing to prospective students.
Strategy #3: Identify the major challenges and find ways to mitigate them:
Two major challenges in entering any new market are understanding the local market,
especially in terms of marketing, and having the experience to navigate the regulatory
environment. Several times during the interviews, the senior leaders of Curtin University
underscored the great importance of financially sustainability. Although Curtin’s goal for
establishing the offshore program in Vietnam was more for building its international brand and
reputation and not necessarily for profit, the university still could not lose money—which meant
that local expertise in marketing and recruiting students was essential. Curtin University
recognized this need and it was one of the key reasons SEAMEO RETRAC was chosen as a
partner. At first, the incentive to partner with RETRAC was the base of potential students who
EXAMINING MARKET ENTRY STRATEGIES 106
graduated from RELC’s diploma program, which already articulated into Curtin’s Master’s
program. But, Curtin also made sure to evaluate RETRAC’s ability to continue to market its
programs for the long-term. This capacity became more evident once Curtin saw the vast
experience that RETRAC had in joint programs with other western universities. The success of
those programs indicated that RETRAC was adept at local marketing and recruiting. Curtin was
able to utilize RETRAC’s local expertise to minimize this challenge.
In addition, in numerous interviews Curtin staff and faculty cited obtaining appropriate
licenses and approvals to operate legally as a significant challenge inherent in operating in a new
country. The regulatory environment of Vietnam was a concern because of Curtin’s limited
experience in operating in the country. This factor was also a point of emphasis when Curtin
evaluated RETRAC as a potential partner. Fortunately, attaining this access was one of
RETRAC’s strengths, as it had extensive experience partnering with foreign universities and also
had a close relationship with the Ministry of Education and Training. Curtin made sure that the
agreement outlined RETRAC’s responsibility in handing regulatory matters, including licenses
and approvals. This service helped mitigate the regulatory challenges posed by market entry.
Recommendations for Practice
For universities seeking to enter the market in Vietnam, several factors make it an
attractive option. Because the country has limited local capacity for higher education, MOET’s
policies are open and encouraging to western universities that want to operate locally. In
addition, the demand for higher education in Vietnam continues to grow. In 2006, Vietnam’s
participation rate in higher education was only 16%, but by 2011 Vietnam achieved 24%
participation rate in higher education--which is low compared to some other countries in
Southeast Asia such as Thailand at 48% and Malaysia at 42% (World Bank, 2011), but
EXAMINING MARKET ENTRY STRATEGIES 107
demonstrates the strength of the market. In addition, setting up an international branch campus
is difficult, so finding the right local partner with which to offer an offshore program is
imperative. This structure is probably the best choice for most institutions, as it minimizes risk
and financial exposure while avoiding capital expenses such as facilities. At the same time, one
of the most important factors to consider when offering offshore programs is the level of control
the home university retains, especially when it comes to curriculum and instruction. When
offering offshore programs in any country, the balance of risk and control needs to be evaluated
carefully. Larger institutions may be able to take on more risk and contribute more to the
partnership—such as flying in home faculty—but smaller institutions may have to cede control
on the delivery of curriculum. Partnering with the right local institution affords the appropriate
level of control needed to protect the brand and credibility of the school and program. These
areas are important to the success and integrity of any offshore program so universities must pay
close attention to these significant factors affecting market entry strategy.
Based on the findings from this case study of Curtin University’s entrance into the
Vietnam market, the following are recommendations for universities considering the creation of
offshore programs:
1. Assess own capabilities, expertise, and capacity
2. Align university mission and objectives with proposed offshore program and local
partner
3. Facilitate buy-in from key staff members and faculty toward internationalization efforts
4. Implement sufficient quality control processes to protect the university brand
5. Understand the pivotal role of developing strategic alliances and key relationships
6. Consider market mode of entry that provides control but minimizes risk
EXAMINING MARKET ENTRY STRATEGIES 108
7. If considering a local partner, evaluate carefully division of responsibilities
8. Find a partner with experience in local regulatory matters and has marketing expertise
9. Thoroughly research target country and local student market
While the points above emerged from analysis of Curtin University’s experience in Vietnam,
they provide important guidelines with broader relevance for any university considering
expansion into a new country.
Recommendations for Research
Although based on a single case study of an Australian University’s market entry strategy
into the country of Vietnam, this research yielded useful information for Western universities
seeking to expand internationally by establishing offshore programs in developing countries.
This case study’s analysis highlighted factors that affected the decision-making process behind
foreign market entry. As more universities look to internationalize through cross-border
partnerships, more research is necessary on the market entry process into other developing
countries. Understanding how the competitive marketplace affects market entry strategy into
other target countries is crucial for any university looking to expand abroad. Each country has a
different local market of competitors and a unique student demand. Case studies focused more
on the regulatory environment of different countries would add to the depth and breadth to
market entry research. Higher education regulations differ drastically in different markets.
This study focused on a university with vast experience in internationalization and a local
partner that had a parallel experience with cross-border programs. Research on the market entry
strategy of an institution with less experience in offshore programs and one with less capacity to
internalize operations abroad is still needed. Researching a university that offers a more common
program like business as opposed to linguistics may be more relevant to a greater number of
EXAMINING MARKET ENTRY STRATEGIES 109
institutions. Further comparison of the strategies that Curtin University employed in Vietnam to
universities entering other developing countries would fill the gap in research on foreign market
entry strategy. Comparing case studies from western universities entering different countries
would be quite useful to see which specific strategies would be beneficial across borders and
which only provide country-specific advantages. Also, a longitudinal study, evaluating the
success of these offshore programs and the contributing factors would be quite valuable. In
addition, closer examination of how programs and partnerships evolve would complement this
study. In the case of Curtin University, SEAMEO RELC and SEAMEO RETRAC, a three-
member collaboration eventually evolved into a partnership with just only two members. So,
understanding the reasons why such relationships change over time may shed some light on
some strategies for sustaining a program rather than just implementing one.
Conclusion
The development of offshore programs by Western universities in developing countries is
increasing. Finding new revenue streams and becoming more recognized internationally have
motivated leaders of institutions to engage in cross-border programs. There is a dearth of
research focused on foreign market entry strategy.
Various factors affected Curtin University’s entry process into Vietnam. The decisions
made by Curtin leaders were driven by the characteristics of the local competitive marketplace
and the complex regulatory environment. The theoretical lens of Dunning’s (1988) OLI-
Framework demonstrated that CU’s market entry strategy was highly influenced by its unique
ownership advantages, the location benefits of Vietnam and its market, and the internalization
rights that Curtin was able to assume. Curtin’s vast experience setting up offshore degree
programs and its expertise at negotiating cross-border partnerships offered noteworthy
EXAMINING MARKET ENTRY STRATEGIES 110
advantages for CU, allowing it to recognize the benefits of Vietnam’s emerging market and
economy, its collaborative local partners, and increasing student demand. The internalization
advantages that Curtin took the greatest advantage of was its ability to fly teachers in from the
home campus to deliver the curriculum and, at the same time, maintain a high quality program
comparable to the one offered at its home campus.
EXAMINING MARKET ENTRY STRATEGIES 111
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Abstract (if available)
Abstract
This study utilizes the OLI-Framework to examine the Ownership advantages, Location advantages, and Internalization advantages that affect foreign market entry strategy. The purpose of this study was to examine Curtin University’s market entry strategy for international expansion into Vietnam through its offshore Master of Arts in Applied Linguistics Program. Specifically, the study sought to determine the major factors shaping Curtin University’s market entry strategies, including the competitive marketplace in Vietnam and the regulatory environment of Vietnam’s higher education sector. This single case study employed qualitative research techniques, in the form of interviews with Curtin University administrators and faculty as well as document analysis, to gain a better understanding of the strategies Curtin University used to set up its Master of Arts in Applied Linguistics Program in Vietnam. Findings from this study revealed that Curtin University’s offshore strategy was to: recognize its internal strengths and utilize them appropriately, target a country with an attractive local market on which it could capitalize, and identify the major challenges in entering a new market and find ways to mitigate them. Recommendations for universities considering the creation of offshore programs include assessing its own capabilities, expertise, and capacity, aligning university mission and objectives with proposed offshore program, facilitating buy-in from key staff members and faculty toward internationalization efforts, implementing sufficient quality control processes to protect university brand, and understanding the pivotal role of developing strategic alliances and key relationships.
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Lee, Anthony Michael
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Examining the market entry strategies of a university's international expansion into a developing country
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Rossier School of Education
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Doctor of Education
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Education (Leadership)
Publication Date
10/08/2013
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