After a decade of establishing itself in China’s foreign education market, the Canadian Institute of Business and Technology (CIBT) Education Group was finding that the market for Western-style education in major Chinese cities was becoming saturated. The enrolment rate in CIBT’s MBA programs in Beijing declined sharply by 20% in 2004. Toby Chu, president and CEO of CIBT, believed that the company needed a significant change in strategy and a new business model for future growth in China. One option was to shift attention to the relatively unexplored second- and third-tier cities where less competition was expected. In 2004, Weifang University (WU) based in Weifang, an inland, third-tier city in Shandong province, was interested in collaborating with CIBT to provide vocational programs. Chu and his executive team had to respond to WU and Chu was wondering if Weifang could be a start to test CIBT’s new model for education in China. Case B provides a follow up and an update.
Learning Objective
1) Expand the understanding of large markets like China by introducing students to a lesser-known city like Weifang. 2) Understand the subtleties of business planning in large markets like China where growth opportunities in second- and third-tier markets tend to be ignored by businesses. 3) Develop an appreciation of the role of partners in these markets, which tend to be more complex and high on institutional voids. 4) Understand the tradeoffs between market attractiveness and business competitiveness; profitability can be better in tier-two or tier-three markets for businesses that cannot match the industry leaders.
Keywords
International Business, Global Strategy, Education, Business School, Growth
Settings
Asia, China
CIBT Education Group
2004
Available Languages
English
Related material
Teaching note
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