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Business Officer Magazine
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Why and How to Go Global

American University in Cairo (AUC) President Lisa Anderson discusses the risks and benefits of pursuing international opportunities.

By Joseph Yohe

Many institutions in the United States want to expand their global presence in some way-initiating a new international program, a student exchange, or a physical campus. As institution leaders assess how they can best fulfill their globalization mission, what suggestions do you have for decision makers when evaluating the risks and benefits of new international opportunities?

It's inevitable and desirable for American higher education leaders to think of their institutions in a global context, and that could mean a whole variety of things, not the least of which is more international students, more study abroad opportunities for degree candidates, and more faculty mobility. The question is, how does an institution ensure that whatever it is doing for its students and faculty is sustainable? (For more of Lisa Anderson's interview detailing lessons learned as president of an overseas branch campus, see the On Balance interview in the March 2014 issue of Business Officer.)

Part of the impulse to establish branch campuses and global relationships has been an assumption that we can manage the quality and make sure that our students and faculty are well cared for by our standards wherever we have campuses. The problem with that, in my estimation, is that it can actually limit the options of an ambitious, agile university in the 21st century.

The way to think about higher education in the next 20 or 30 years is within this context of a preponderance of mobility, where you don't want to limit your students or faculty to going places where you have a brick-and-mortar presence. The best universities in the world are essentially going to be nose-in networks.

Can you expand on that?

What you want are thick networks of relationships with existing institutions already embedded in other places. That permits you to send small research clusters here and there to collaborate on specific interests where you have or want to establish expertise.

In this scenario, there may be 300 nodes of these networks supported by universities that can maintain multiple relationships. I think partnerships are much more likely the way that intellectual exchange and research collaboration is sustained going forward and the way that faculty and student mobility will be managed.

Simply erecting a building in another part of the world to present essentially the same curriculum that you offer in Washington, D.C., or New York City, or Seattle doesn't give the home institution the kind of advantage of exposure to different approaches to problems or different ways of organizing things that obliging yourself to working with another institution does. If you pick your 100 best friends and start developing programs with them, you are much more likely to have the variety of options that any ambitious university wants to provide to its students and faculty. That's a different model, but one that I think we will see emerge more frequently.

For institutions that do wish to pursue an international campus, are there key financial and reputational considerations that decision makers must bear in mind?

Clearly, the two issues that you mentioned are what most people think about, at least on the surface. Is this going to be a drain on the budget of the home campus? What is the opportunity cost? Could you build a new program at home instead of doing this? The financial concerns are quite serious and legitimate. As for the reputational concerns, for institutions that anticipate operating in countries that don't have the same kind of civil and human rights traditions that the United States has, leaders must be comfortable with that.

Another way to measure whether this is something an institution ought to do is faculty interest. Too often presidents and provosts and deans may think something is a great idea, but then no one on the faculty embraces it. They may not oppose it, but if there's no real uptake, it won't gain traction.

If I were a university president in the United States trying to make this decision, and if I didn't have faculty champions—and more than one or two—I would have serious qualms about it even if I thought it was affordable and there was no reputational downside. You have to consider who is going to love this program over the long run and be dedicated to sustaining it when others are long gone.

What are some of the inherent administrative challenges that institutions face when they expand internationally, and what is the best way for institutions to organize operationally to support, from an administrative perspective, these endeavors?            

I don't have any dramatic insights about operations. We look a lot like an American university in how we are organized, how we admit students, how we interact with our board of trustees, and so forth. These would be completely familiar to anyone running a private university in the United States.

That said, there are some significant differences. For starters, we operate in two different regulatory environments. We are incorporated and accredited in the United States, so we have to meet those standards. We also have to meet the federal regulatory standards on higher education because some of our study abroad students bring with them federal financial aid. Of course we also must adhere to operational requirements and regulations here in Egypt. Many of the ways our degrees are certified in Egypt create a parallel universe of administration.

We also operate in a completely different labor regime. Something I had to learn quickly when I came to AUC first as provost and then as president was that Egyptian labor law reflects a very different theory of how a workplace is run and different practices for how you recruit, retain, and compensate people—from custodians to faculty—so that's been quite a challenge.

We also obviously operate in two currencies. This creates another layer of complexity in our budgeting that we have to accommodate. In the past couple of years, the Egyptian pound—which had been quite stable against the dollar—began to fall. And so we've had to learn to manage our budget in the face of considerable foreign exchange uncertainty. Putting together and managing a budget is challenge enough without such uncertainty.

And, of course, we operate in two languages. We are an English medium university. All of our teaching is in English and most of the senior administration is conversant in English. But, as soon as you move to facilities operations, for instance, we shift to speaking Arabic. We have to work very carefully to make sure that our communications to various internal and external constituencies are understandable to all. So, we've done a lot to increase the agility of our communications as well as our operations.

Most of the places where American universities have thought about branches are in countries in the Gulf or Singapore, which are essentially English media operations, so this is less complicated. But, if you really want to put a branch campus in Paris, for instance, you're going to have to operate in French. The transaction costs of operating in another country should not be underestimated.

JOSEPH YOHE is associate vice president for risk management, Georgetown University, Washington, D.C.