Internationalization as Mergers and Acquisitions

Abstract

This study investigated the various emerging forms of internationalization and how senior international affairs officers describe their motivations and rationales for implementing these activities. Based on interviews with senior international officers at 30 international offices in U.S. public universities, this study identified and classified increased entrepreneurial activities in the forms of acquisitions and mergers.

Keywords

international exchange programs internationalization of higher education strategic institutional management of internationalization globalization and international higher education cross-border delivery of education

U.S. higher education has become increasingly internationalized over the past decades. In the 2012-2013 academic year, an all-time high of 819,644 international students were studying in the United States, about 7% higher than the year before (Institute of International Education [IIE], 2013) and more than 250% higher than three decades ago (Bhandari & Chow, 2011). The number of U.S. students studying abroad for academic credit has also reached a record high, totaling 283,332 during the 2011-2012 academic year, 3 times the number two decades ago (IIE, 2013). Robust growth in U.S. students studying abroad and in foreign students studying in the United States is expected to continue with major initiatives to further strengthen international participation. As an example, the IIE’s Generation Study Abroad initiative supports the goal of doubling U.S. study abroad enrollments by 2020.

Whereas educational motives have historically driven international higher education activities, revenue generation is becoming increasingly important (Knight, 2004). During 2012, international students contributed US$24.7 billion to the U.S. economy (IIE, 2013) with more than 70% of financing coming from outside the United States (IIE, 2013). The substantial revenue stream from international students has been used to counteract diminishing state support for higher education. Meanwhile, growing public expectations of higher education institutions (HEI), and intensifying competition among these institutions, are also driving the search to identify alternative sources of revenue (Clark, 1998; Slaughter & Leslie, 1997), including via international engagement. Over time, international activities have not only grown (Olcott, 2009) but also changed (Mazzarol, Soutar, & Seng, 2003). Forms of international delivery have increased and diversified through joint and dual degrees, online courses, and international branch campuses, to name a few examples. With such changes in international education, the responsibilities of HEI international offices have also expanded beyond traditional student exchange.

Some scholars believe that international higher education is at a crossroads between pursuing its traditional education-based mission versus seeking to generate profits (Altbach & Knight, 2006; Lee, 2013). Although some have raised concerns about how entrepreneurialism might be influencing internationalization, empirical research on this topic is lacking. In particular, evidence regarding the perceptions of international education leaders lacks systematic exploration. Thus, this study investigated the various emerging forms of internationalization and how senior international affairs officers describe their motivations and rationales for implementing these activities.

Literature Review

The history of international offices in U.S. higher education can be traced back to the advent of international student advisors in the early 20th century. The original international student advisors were faculty, but gradually that role was assigned to administrators, as occurred at Oberlin College in 1910 (Cornell Cosmopolitan Club, 1913, as cited in Glazier & Kenschaft, 2002). On-campus international student advising grew throughout the 1910s and 1920s, but then international student mobility to the United States slowed dramatically in the 1930s and 1940s during the Great Depression and World War II (Glazier & Kenschaft, 2002).

The global international higher education market developed considerably following World War II, representing the beginning of large-scale higher education internationalization (Mazzarol et al., 2003). This period saw the professionalization of international education with the creation of the National Association of Foreign Student Advisors (NAFSA), in 1948 (Glazier & Kenschaft, 2002), as well as the growth of campus-based study abroad programs. On-campus international offices sprang up to facilitate students’ study abroad experiences and to integrate these programs into students’ formal academic curricula (Hoffa, 2000). Strong growth in the internationalization of U.S. higher education continued through the last quarter of the 20th century and into the early 21st century, and international offices grew correspondingly. The responsibilities of international offices expanded as HEIs increased their international activities and centralized many of them in international offices.

Since the 1990s, the academic environment in which international offices operate has evolved markedly. The expansion and diversification of higher education have challenged HEIs to play greater roles in society (Clark, 1998). Meanwhile, public support for higher education, measured on a per-student basis, has diminished (Carbone & Winston, 2004) whereas the U.S. higher education industry has become more competitive (Slaughter & Leslie, 1997). Universities have reacted to these changes by pursuing alternative sources of revenue, including international students (Slaughter & Leslie, 1997; Slaughter & Rhoades, 2004).

Revenue Generation in International Education

The dearth of empirical research on the intersection between internationalization and entrepreneurialism is concerning in light of heightened speculation that projects abroad are motivated more by profit than academics (Knight, 2005, 2012; Scott, 1998). In addition to revenue generation, other economic factors, such as brain gain and capacity building,¹ have become more significant in internationalization (Vincent-Lancrin, 2009). Revenue generation occurs primarily through international students paying full tuition fees as well as the development of for-profit international education programs (Vincent-Lancrin, 2009). The United States, Canada, the United Kingdom, New Zealand, Australia, Denmark, the Netherlands, Singapore, Malaysia, and Hong Kong are among the countries most actively pursuing revenue-generating forms of internationalization (Vincent-Lancrin, 2009). HEIs in these countries engage in international entrepreneurialism by setting tuition based on market rates, franchising their programs abroad, hosting international programs on their home campuses, and opening campuses abroad (Vincent-Lancrin, 2009). English-speaking countries have historically been most successful in attracting international students, but an increasing number of non-English-speaking countries are now offering English programs in an effort to attract students (Jon, Lee, & Byun, 2013; Organisation for Economic Co-Operation and Development [OECD], 2013).

The substantial commercial implications of international education have attracted the attention of the World Trade Organization (WTO), which regulates international trade in higher education through the General Agreement on Trades in Services (GATS). GATS aims to establish a level and fair playing field for the international higher education market by allowing all 145 WTO member countries to lodge complaints against other nations that erect barriers to the free trade of education services (Knight, 2003). The WTO reviews complaints and may require the offending country to change its practices. U.S. complaints have resulted in the elimination of several foreign regulations (Knight, 2003), including those requiring that

foreign educational providers may only instruct non-citizens (Turkey and Italy);

only citizens may head educational institutions (Taiwan); and

foreign educational providers must partner with domestic universities (China).

Because GATS applies only to issues that directly affect international trade, it does not address, for example, the internationalization of domestic curriculum. It does, however, cover international delivery of education, such as

higher education services supplied internationally (e.g., via distance education programs);

student study abroad for part or all of a degree;

a foreign provider’s commercial presence abroad, such as a branch campus; and

the international travel of higher education employees for employment, such as temporary teaching or research appointments (Duke, 2002).

International student recruitment

Research on internationalization and entrepreneurialism in higher education has focused on how the desire for revenue has driven international student recruitment, particularly in such countries as the United States (Burn, 2002), the United Kingdom (Burn, 2002; Hawthorne, 2012), Canada (Burnett & Huisman, 2010), Australia (Burn, 2002; Walters & Adams, 2001; Welch, 2012), Finland (Cai & Kivisto, 2011), and the European Union (Hawthorne, 2012). Because in U.S. state universities, international students pay the same rates as out-of-state students (Burn, 2002), cuts in public appropriations, especially since the 2008 financial crisis, have encouraged recruitment of both types of high-tuition-paying students (Hawthorne, 2012). The high demand for and benefits of international enrollment have led many U.S. states to lift their caps on the number of international students their universities can enroll (Hawthorne, 2012).

Changes in the international student market

The United States dominates the international student market, hosting 17% of all international students (OECD, 2013). Although the United States does not have a well-coordinated national strategy to attract international students, the appeal of individual institutions along with the availability of resources and opportunities in the United States drive foreign enrollment. Many international students are drawn to the United States by the global reputation of its higher education system, as U.S. universities routinely dominate top-20 lists in international rankings of quality. The highly regarded Shanghai ranking of universities worldwide lists 17 U.S. universities among its top 20 (Shanghai Ranking Consultancy, 2013).

The U.S. market share of international students, however, has declined from 23% in 2000 to 17% in 2011 (OECD, 2013). Three developments threaten the dominance of the United States and other Western countries. First, sending countries such as China (especially Hong Kong), Singapore, and Malaysia are expanding their higher education capacity (Asteris, 2006), offering many students who traditionally would have gone abroad access to high-quality, domestic HEIs. HEIs in many non-English-speaking countries are emulating foreign universities by offering instruction in English and utilizing curricular design and quality assurance procedures based on Western models (Asteris, 2006; OECD, 2013). Consequently, students in these countries will be more likely to pursue degrees in their homeland or in regional alternatives closer to home.

Enticed by the financial benefits that international students offer to both HEIs and national economies, several non-Western countries are beginning to actively recruit international students. Thus, countries that are increasing domestic capacity—particularly Hong Kong, Singapore, and Malaysia—are also recruiting international students (Asteris, 2006). Singapore hopes to increase international student enrollment by 250% in 10 years (Harmon, 2006). As new providers enter the international student market, traditional Western destinations face greater competition for students.

Finally, new technologies are threatening the dominance of traditional hosting nations. Private companies such as Person and Thompson and the Apollo Group are increasingly attracting students to their web-based programs (Asteris, 2006). These companies have the ability to reshape the international student market, as students become able to access foreign education without leaving home. The impact of such companies on the international student market remains to be seen; for example, many students travel abroad not only for academic reasons but also to develop competency in another culture and language. The United Kingdom is already acting to counter web-based competition by strengthening the British higher education brand and making traditional, face-to-face higher education in Britain more attractive to foreign students by, for example, loosening right-to-work regulations for students (Asteris, 2006).

International students’ impact on national economies

In addition to generating revenue for HEIs through tuition fees, international students contribute to local and national economies (Asteris, 2006; Bhandari & Chow, 2011; Welch, 2012). Not only do international students pay for tuition and living expenses, but visiting family members contribute additional revenue. The financial and economic impact of international students in the United States is substantial. Among the US$22.7 billion international students contributed to the United States in 2011 (IIE, 2012), Chinese students contributed US$4 billion, Indian students US$3.3 billion, and South Korean students US$2.2 billion (Bureau of Economic Analysis, 2012).

Other entrepreneurial activities in internationalization

International student recruitment is the most common and best researched approach to entrepreneurialism. Hudzik and Stohl (2012) also cite “contracts abroad on a cost plus or high overhead return basis” (p. 73) as another revenue-generating international activity. Heyl and Tullbane (2012) point out that senior international officers must show that new international activities, beyond student recruitment, are “at worst, revenue neutral” (p. 117). Study abroad, traditionally not a revenue-generating activity, is expected to become increasingly entrepreneurial as, for example, HEIs charge students home tuition for programs abroad that cost significantly less (Burn, 2002). This controversial practice prompted an alumnus to file a lawsuit against Wheaton College for charging approximately US$21,000 in Wheaton tuition, room, and board for a program that cost US$4,439 less.

Another innovation are pathways programs that allow students to begin their university education in their home country then transfer to a host institution abroad (Adams, Leventhal, & Connelly, 2012). Similar are dual degree agreements in which students take courses at two different institutions in two different countries and earn a degree from each institution. The curricula at both schools are coordinated to complement each other and leverage the unique strengths of each participating institution. Both pathway and dual degree programs are beneficial to U.S. HEIs in that they serve as a recruiting mechanism for international students. For example, a dual degree agreement between U.S. and Chinese HEIs turns the Chinese institution into a recruiter for its U.S. partner when it promotes the program to Chinese students. The U.S. HEI benefits from receiving out-of-state tuition from Chinese visiting students and diversifying its student body, whereas the Chinese HEI offers a program that attracts U.S. students. International student recruitment by this means may be more efficient than direct recruitment abroad, as it saves U.S. institutions the travel costs associated with the latter.

The creation of branch campuses abroad is another emerging trend, driven in part by opportunities for income and access to foreign markets (Becker, 2009; Garrett, 2004). When host and home national governments work together to set up a branch campus, their motivations may be different, with the home government tending to serve private interests and the host country the public good (Lane & Kinser, 2011). The profit orientation of branch campuses has also created tension with traditional academic values and standards (Shams & Huisman, 2012).

Universities are also increasingly reaching out to international alumni, seeking funds to support international students or international faculty, or to strengthen an international component of the curriculum (Taylor, 2004). Nurturing such alumni tends to require frequent travel overseas, so having a physical presence abroad can open doors to more funding opportunities. HEIs may also be able to raise funds from foreign corporations or from domestic companies that target foreign markets (Taylor, 2004).

Critiques of Entrepreneurialism in International Education

Concerns have been expressed regarding the increasing influence of entrepreneurialism in international education. A 2005 survey of HEIs in 95 countries conducted by the International Association of Universities found that the commercialization and commodification of educational services is one of the major perceived risks associated with internationalization (Knight, 2007). The heightened profit motivation may threaten the academic values that traditionally have driven internationalization (Green, Marmolejo, & Egron-Polak, 2012), particularly when the two objectives conflict. The same concern has been raised more generally in higher education, specifically that as HEIs prioritize revenue generation, traditional academic priorities lose influence in the decision-making process (Slaughter & Rhoades, 2004).

Opportunities for revenue generation through internationalization may also shift the historical missions of HEIs. Whereas many HEIs were founded to serve their local or regional communities, financial incentives are encouraging them to look beyond their borders for students. Oxford University, for example, announced in 2005 that it would reduce admissions of British and EU students while increasing seats for international students who pay higher tuition rates (Marginson & van der Wende, 2009). Oxford justified this change as not merely financially motivated but as also creating a more multicultural learning environment.

Academic Capitalism

The theoretical framework for this study is academic capitalism, or the marketization of higher education in the late 20th and early 21st centuries. Marketization has manifested through increased connections of HEIs to external resources, the commodification of goods and services, and private-sector influences on campus (Slaughter & Rhoades, 2004). According to academic capitalism, the public space in which universities operate is being redefined, and so are appropriate behaviors within that space. As campus entities, such as international offices, are pressured to find alternative revenues to replace state subsidies, greater resource dependency (Pheffer & Salancik, 1978) has the potential to reshape the rationales and strategies of internationalization.

Previous research has demonstrated how university administrators interpret the public nature of higher education and work in that context. One study, however, has suggested that higher education leaders are reconceptualizing the public good as coexisting with private, economic gains (Hensley, Galilee-Belfer, & Lee, 2013). Furthermore, early-career student affairs professionals are increasingly being socialized within the framework of “student affairs capitalism” (Lee & Helm, 2013). For example, these professionals reported that senior staff pressured them to engage in more market activities (e.g., fundraising, seeking donors, creating advertisements), sometimes at the expense of assisting students directly. Given this trend toward reshaping higher education in terms of financial outcomes and interests, this study examines the views of senior administrators in what is arguably the most rapidly changing university sector, international affairs.

Within HEIs, international offices act as catalysts for campus internationalization and are responsible for monitoring the quality and integrity of a campus’s international activities (Knight & de Wit, 1995). At the same time, many differences exist between international offices on different campuses. The internal and external environments of an HEI affect where the international office exists within the HEI and how it fulfills its responsibilities (Knight & de Wit, 1995). Because the international office guides many of the international strategies and activities of an HEI, this is the locus of the present research. The research questions were as follows:

Research Question 1: What are the various entrepreneurial strategies and activities within U.S. international student offices?

Research Question 2: To what extent are these strategies and activities economically motivated?

Method

Senior international officers (SIO) at 30 international offices (IO) in U.S. public HEIs were recruited for interviews. The sample was obtained through a combination of typical case sampling (designed to create a sample that represents average members of the population) and intensity sampling (designed to create a sample that represents the phenomenon under study; Marshall & Rossman, 2006). As Table 1 shows, the institutions sampled represented all regions of the country and a range of sizes: 5 large (35,000 or more students), 3 medium-large (27,000-34,999 students), 9 medium (14,000-26,999 students), 8 medium-small (7,000-13,999 students), and 5 small (fewer than 7,000 students).

Table 1.

Characteristics of Institutions Sampled.

HEI/SIO	Region	Size	International students	U.S. students studying abroad
1	Southwest	Large	13,300	1,387
2	West	Medium	196	145
3	Southeast	Medium	954	1,009
4	Northeast	Small	36	331
5	Southeast	Medium-small	80	172
6	Southeast	Small	130	239
7	Southeast	Medium	184	1,030
8	Midwest	Large	4,509	2,589
9	Midwest	Medium-small	630	75
10	Southeast	Medium	238	415
11	Southeast	Medium-small	591	330
12	Southeast	Small	55	165
13	Southwest	Medium	926	409
14	South	Medium	1,821	576
15	Northeast	Medium-small	53	537
16	Northeast	Medium-large	4,911	550
17	Northeast	Small	158	489
18	Southwest	Large	2,664	2,064
19	Southeast	Large	3,088	2,025
20	Midwest	Large	4,714	1,939
21	Southeast	Medium	1,304	637
22	Northeast	Medium	564	144
23	West	Medium-large	1,145	447
24	South	Medium-small	800	480
25	Southeast	Medium	844	65
26	West	Medium-large	1,411	684
27	Southeast	Medium-small	115	172
28	Northeast	Medium-small	136	200
29	Southeast	Medium-small	112	187
30	Southeast	Small	120	175

Note. HEI = higher education institution; SIO = senior international officer.

The interview protocol was developed from the literature with particular attention to the academic capitalism framework. The interview protocol addressed the entrepreneurial strategies and activities of the office, how the office is funded, the external forces that influence its actions, and how the SIO balances budgetary and educational priorities. The protocol was then piloted to three international affairs employees and revised for clarification.

Thematic analysis was applied to the transcribed interviews. Thematic analysis involves identifying patterns throughout the data to address the research questions (Braun & Clarke, 2006). Transcriptions were carefully read and reread until categories of meaning were found in the interviews, at which time, codes were created and applied. The preliminary codes of activities, strategies, guiding forces, funding, and entrepreneurialism were developed and used to organize the information obtained in interviews. Additional sub-codes were used to further organize the initial codes and to better address this study’s research questions. Themes, or categories of meaning among the codes, were then identified and that addressed the research questions of this study.

Findings

Most of the staff in international offices are dedicated to maintaining and supporting existing students, scholars, and programs, although in some respects, the degree of emphasis on these activities has shifted. Activities in this category include oversight of education abroad programs (e.g., management of partnerships abroad, coordination of faculty-led programs, and student advising). International student and scholar services typically involve support services, such as advising on immigration matters, orientations, and cultural programs. The management of international agreements encompasses identifying international partners, vetting the content of the agreements, routing agreements for signature, and keeping records of agreements.

Although maintaining educational commitments to students, scholars, and programs remains central to the activities of these offices, new initiatives are emerging. Dual degree agreements in which students earn degrees from two separate institutions for one coordinated course of study are ever more common, as is international student recruitment. Two other emerging activities are the delivery of credit overseas to foreign students and the establishment of international alumni networks.

Utilizing the framework of academic capitalism, international initiatives can be classified into two market-based categories: acquisitions and mergers. We offer these business metaphors to emphasize and differentiate the entrepreneurial nature of the undertakings discussed in the interviews. Conceptualizing international activities as acquisitions and mergers helps us identify changes in international education as developing countries are increasingly asserting themselves in creating collaborations that will both benefit themselves and their international partner. For example, an increasing number of Chinese universities are focusing on dual degree programs with foreign universities rather than simply sending their students abroad. These students are now pursuing part of their degrees in China while contributing to the quality of Chinese universities. Developing shuang ying (win–win) relationships is becoming increasingly important for foreign universities building relationships with Chinese partners. Such an example of a shift away from mere acquisitions and toward mergers is quite evident in the internationalization of Chinese higher education.

Although these strategies and activities were justified on educational grounds, the drivers are primarily financial. Traditional activities such as study abroad programs and international student and scholar services are becoming increasingly entrepreneurial as international offices are shifting toward user-pays funding mechanisms. The following sections detail the senior international affair officers’ views.

Acquisition

In the context of international education, acquisitions can be understood as activities focused on the acquiring of resources from abroad. In this study, the primary form of acquisition is international student enrollment, while international alumni giving is emerging.

International student enrollment

The primary form of internationalization occurring in the sampled institutions is an emphasis on recruiting international students. Whereas international exchange and study have historically been viewed as extensions of educational diplomacy, SIOs described these students in terms of their considerable financial value as payers of out-of-state tuition rates who bring added revenue to the university. Half of the interviewees indicated that they were directly encouraged to recruit students from abroad. For example, whereas SIO 1 values the presence of international students on campus for educational reasons, she explained that for her central administration, “the primary incentive appears to be financial.” The leadership of both HEIs 5 and 15 likewise supported the presence of international students on campus for educational reasons but acknowledged that their primary interest was monetary. The president of HEI 9 regularly asks SIO 9 about his international student recruitment numbers. SIO 9 stated, “There is this recognition that international students are an important component to our . . . I don’t want to say financial survival . . . but in a way they are.” According to SIO 13, “the need to attract more international students who are fee paying constitutes an expectation that has been articulated quite clearly by the senior administration here.”

Given the increasing supply of students looking to study in the United States, there has also been a recent trend toward international recruitment. Many HEIs have either recently started recruiting abroad or plan on doing so soon. HEI 6 actively recruits international students. According to SIO 6, the institution is “struggling to get some funding for oversees recruitment,” to expand recruitment through relationships with recruiters.

HEI 5 is in the process of developing its recruitment capability, as SIO 5 described,

We’ve been looking more recently, in the last year or two, at international student recruitment. Even though that’s not formally under this office, we’ve taken a sort of leadership role, in that when the university looked at doing it for the first time, and we were going through a first institutional campus internationalization planning process, we did that in a sort of preliminary way, just through the international education committee. But this particular year it’s something that’s been requested by the provost, so because it’s being requested by the top leadership, it’s more intensive, and more likely to be successful so we’re very optimistic about that right now.

Although it is not clear which entity would ultimately be responsible for international recruitment, SIO 5 was providing leadership in moving the initiative forward. International student recruitment is one of six initiatives highlighted in IO5’s 2012 strategic plan, and an international student recruitment coordinator was to be hired in spring 2013.

SIO 15 had recently had international recruitment added to his responsibilities; he stated that it “never used to be part of this office, never used to be systematically approached on campus in any way, so we’ve become much more systematic and much more intentional about our international recruiting efforts.” Similarly, IOs 24 and 26 had until recently engaged in limited recruitment, but international recruitment may become a responsibility of the international office. SIO 28 indicated interest in recruitment but noted,

Right now, no one is really claiming responsibility for recruitment, and I’ve also found out that I don’t really have any tools to help in recruiting the students. I mean, I do have some tools, but in general I don’t have scholarships, I don’t have tuition waivers, things like that.

HEIs 7, 11, 16, 21, 26, 27, and 30 were also engaging in international student recruitment. SIO 16 acknowledged that his office has greater interest in education abroad, but they will continue to recruit international students, “maybe more so than in the past because of cutbacks and state budgets.” HEI 21 approached international student recruitment by making it a responsibility of both the international office and the enrollment management office. At HEI 30, a professional international education administrator was hired to develop international recruitment.

International alumni

Alumni relations offices at U.S. colleges and universities have long nurtured domestic alumni by developing alumni networks, publishing alumni newsletters, inviting alumni to campus events, and otherwise keeping them engaged with their alma mater, in the hope that they would contribute financially to the institution. International alumni have traditionally been neglected in these efforts at all but a few universities, but this situation seems to be changing.

SIOs 8, 12, 13, 15, and 26 specifically identified networking with foreign alumni. IO 12’s internationalization plan assigned to the alumni relations office the responsibility to “establish a network of alumni living and working abroad.” SIO 13 commented,

It is important to spend time and resources cultivating international alumni because I still believe that they represent an untapped pool of resources and support that the university will increasingly need as it moves into an era where state support continues to decline.

SIO 13 hoped eventually to receive financial support from alumni living abroad, as expressed in IO 13’s mission statement: “to co-opt international alumni and other entities to support the global agenda through giving.” A report by the international education committee at HEI 13 recommended that “a development officer will be assigned to the [international office] who will work alongside the Vice Provost to make global education an organizing principle for fundraising at the university.” IO 15 had not yet begun nurturing alumni but indicated having plans to seek donations to support international education. SIO 18 was the most expressly entrepreneurial of the officers interviewed. A few months after the interview with SIO 18, IO 18 hired a full-time director for international alumni development.

Mergers

Mergers refer to programs that simultaneously benefit either partnering institutions or countries. The primary forms identified in this study were dual degrees and credit delivery abroad. The findings further suggest that some mergers can lead to acquisitions.

Dual degrees

Like international student recruitment, dual degree agreements appear to be becoming more common. Several HEIs were in the process of developing more dual degree programs. SIO 18 reported that the increase in demand for higher education in developing countries, “particularly China and India,” has fueled the growth of dual degree programs at that institution. SIO 13 admitted focusing almost all dual degree efforts on China to tap into the Chinese higher education market. Several interviewees reported the same rationales for targeting Chinese students: China has experienced tremendous growth in demand for higher education in the past decade as its rapidly developing middle class can better afford the costs associated with studying abroad. Like most Asian countries, the supply of high-quality higher education in China has not kept pace with this demand, thus creating excess demand. At the same time, U.S. higher education enjoys an excellent reputation in China. These factors have aligned to make China an important supplier of students to U.S. universities.

Sometimes mergers can lead to acquisitions. HEI 27 has focused its dual degree programs mostly on Korea, and more recently Vietnam, resulting in a recent tripling of international student enrollment. HEI 29 has also developed agreements in both Vietnam and China. Before HEI 29 centralized the responsibility for dual degree programs in the international office, the university had trouble creating agreements that provided high-quality services to international students in an efficient manner. SIO 29 believes that the current centralized system for dual degrees has streamlined and ultimately made more efficient use of institutional resources while providing better services to students.

Curriculum

Although less common, one way that HEIs have sought to achieve both their financial and educational goals has been through internationalizing their curricula in cooperation with international partners through the delivery of credit abroad. The interviewees generally foresaw revenue potential associated with such arrangements. HEI 7 is negotiating with a for-profit organization that will facilitate “providing [HEI 7] credits overseas at study centers.” HEI 18 developed an early-start program in China, whereby Chinese students earn credits from HEI 18 while still in China. This program acted as a feeder of international students to the institution. SIO 18 explained that from his institution’s perspective, the program “was primarily driven by a very pragmatic approach to revenue generation. On the Chinese side it was driven simply by the educational demand.”

The merger of curricula is another activity with acquisition potential. HEI 26 worked with a private organization to develop a feeder program based on the same principle as HEI 18’s program: using the feeder program as a recruitment tool that brings tuition-paying international students to campus. According to SIO 26,

Students would . . . study at [name of organization omitted] study centers in China, and basically already get their sort of first year of general education credits during that time. And then they would come into a summer bridge program coordinated by [HEI 26].

Students would then enroll in HEI 26 as regular international students. SIO 26 reported that the feeder program became problematic and was suspended pending further evaluation because students were enrolling in the program without the skills and academic background necessary to succeed at a U.S. university, and large numbers were failing. The institution “had very little control over the students we were actually getting and their level of preparedness. So we just decided from a resource perspective, it just wasn’t worth it.” From HEI 26’s perspective enrolling poorly prepared students not only put the university’s reputation at risk but also required it to invest resources in students who were less likely than domestic students to persist until graduation.

Discussion

The U.S. higher education landscape is changing as universities increasingly engage in entrepreneurial behaviors (Slaughter & Leslie, 1997). Entrepreneurial behaviors are manifested through (a) stronger connections between universities and the private marketplace and (b) the commercialization of the goods and services produced by universities (Slaughter & Rhoades, 2004). The increasingly entrepreneurial ambitions of HEIs are changing how they educate their students, produce knowledge, and serve their communities.

The findings of this study support previous research that has found educational (Knight, 2004) and entrepreneurial (Davies, 1992; Williams & Kitaev, 2005) rationales for international education now coexist. HEIs are internationalizing in part to realize revenue opportunities present in international student fees, overseas research projects, overseas educational delivery, and international consultancies (Davies, 1992; Williams & Kitaev, 2005). For example, IO 18, the most expressly entrepreneurial of the institutions studied, took the unusual step of creating a full-time position dedicated to nurturing international alumni. This suggests a growing realization that international students often come from wealthy families and are likely to one day be in a financial position to support their alma maters. Targeted international alumni giving is too recent to allow measurement of its outcomes. Soliciting alumni for donations rarely occurs in countries other than the United States and is thus a new concept to many international alumni. The question will be whether students adopt a practice of the host country or practice the norms of their home countries, where alumni typically do not support their alma maters. The time and resources SIOs invest into building relationships with their alumni may not provide a return during their tenures. It may take decades of relationship building before alumni choose to financially support their alma maters. In this respect, SIOs are laying the groundwork for funding that may materialize long after their departure.

The findings of this research also advance current understandings of entrepreneurialism in international higher education. Altbach and Knight (2006) have identified entrepreneurialism’s new role as a driver of international education, but past studies have not explained how that role manifests in international offices, nor do they offer a market-based framework to classify the various approaches. This study contributes to existing scholarship by identifying and classifying ways that entrepreneurialism intersects with internationalization. As this study found, acquisitions and mergers are increasingly commonplace. According to the study participants, revenue generation was an important consideration for maintaining their current activities as well as developing new initiatives and partnerships. For example, SIO 5’s decision to take a leadership role in promoting international student recruitment may be driven in part by a desire to increase the role and responsibilities of his international office. Because international student enrollments can contribute significantly to a university’s bottom line, the unit that brings those students to campus becomes more valuable to the institution. Strategically, one would expect all SIOs to want to leverage international student recruitment as long as they have the resources necessary to do so. Logistically, there are also advantages to having a close relationship between those who recruit international students and those who manage immigration, orientation, and programming for these students by having both units located in the international office.

The delivery of credit abroad is another potentially lucrative acquisition activity. It has the potential to provide highly coveted U.S. higher education to foreign students without those students assuming the extensive costs associated with traveling to and living in the United States for multiple years. However, HEI 26’s experience showed that, as is often the case with new initiatives, credit abroad activities have several challenges. The use of a third-party liaison to the foreign student market apparently diminished HEI 26’s control over the program. As more U.S. HEIs deliver credit abroad to foreign students, best practices will undoubtedly develop to guide program designs such that they better benefit both institutions and the students they serve. In the meantime, the findings of this study suggest that HEIs should proceed cautiously and evaluate whether quality education is a driver of internationalization or merely a convenient excuse to increase revenues.

Footnotes

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

Notes

Author Biographies

Eric Deschamps is the director of Education Abroad and the associate director for the Center for International Education at Northern Arizona University. Dr. Deschamps recently completed a dissertation on the impact of entrepreneurialism on higher education internationalization.

Jenny J. Lee is an associate professor of higher education at the Univeristy of Arizona and an honorary associate professor at Korea University. Her research topics have included academic and administrative labor markets, university partnerships, student engagement, and internationalization.

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