Sustainable Competitive Advantage for Market Leadership Amongst the Private Higher Education Institutes in Malaysia

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2 INTERNATIONAL CONFERENCE ON BUSINESS AND ECONOMIC RESEARCH (2 ICBER 2011) PROCEEDING

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SUSTAINABLE COMPETITIVE ADVANTAGE FOR MARKET LEADERSHIP AMONGST THE PRIVATE HIGHER EDUCATION INSTITUTES IN MALAYSIA Loh Teck Hua KDU University College Business School Section 13 Campus, 76, Jalan Universiti, 46200, Petaling Jaya, Selangor DE ABSTRACT One of Malaysia’s economic goals is to become an education hub for the region. To achieve this, the Malaysian government had liberalised government policies resulting in the proliferation of Private Higher Education Institutions (PHEIs) including private Universities and University Colleges. As competition intensifies it becomes increasingly pertinent to ask “What sustainable competitive advantage should the Private Higher Education Institutions (PHEIs) have to achieve market leadership in the Malaysian education industry?” For the smaller PHEIs, it is a question of survival itself. This paper aims to provide a theoretical study of some of the key strategic activities of the leading PHEIs to answer this question. The literature review covering both foreign and local sources indicates three key factors of sustainable competitive advantage, i.e. branding and image, the physical aspects of higher education including location and facilities, and the mode of delivery. The paper will seek to identify these factors amongst the market leaders to ascertain the validity of the secondary data via critical analysis of their activities. The theoretical framework employed for the analysis will be Michael Porter’s Three Generic Strategies and Five Competitive Forces. The PHEIs have largely evolved into business entities and this development makes the framework appropriate for the study.

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List of tables Table1. Summary of expert views on sustainable competitive advantage Table 2. Analysis of competitive advantages in the context of the five competitive forces Competitive advantage: a convergence of views. 7 13

Table 3.

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List of figures Fig. 1 McGee, Thomas and Wilson’s differentiation strategy. Fig. 2 The five competitive forces affecting the PHEIs Fig. 3 The nature of educational offering 5 8 16

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INTRODUCTION Archer and Hutchins (2000) indicated that the reasons for undertaking a degree program were largely personal and economic: to earn more money and to avoid hard, dirty or dangerous jobs. Higher education allows personal development and facilitates social-class mobility by helping one move up in the socio-economic ladder. Prior to 1996 only the public higher educational institutions had the rights to confer degrees. The Private Higher Educational Institutions (PHEIs) could only confer certificates and diplomas. Since 1996, the Ministry of Education Malaysia (MOE) had introduced legislations that have revolutionalized the higher education system bringing about educational reforms and the democratization of secondary education, increased student enrolment at PHEIs, new public policies and the privatization of higher education in Malaysia. While this development had generally benefited the industry, it had created a challenging, fluid environment where Government interference and legislative changes demand great flexibility and an even greater entrepreneurial mind set from PHEIs. With the creation of the Malaysia Qualifications Agency (MQA), a single quality assurance agency is created in the country whose scope covers both the public and private higher education providers using the Malaysian Qualification Framework (MQF) as a basis.While the MQA has added value and has contributed to the growth of the PHEIs in recent years because it has bolstered confidence in the quality of education, the MQA has also raised the bar for the PHEIs and the PHEIs had to...
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