Worth becoming more competitive?
by Tom Scott
“When the going gets tough, the tough get going” is a well-known idiomatic proverb which refers to the importance of working hard when things are difficult, and the phrase seems to have an ever-present and continued meaning in organisations around the world today. It seems that in today’s reality, hard work never ceases, whether things are on the up or heading down. The importance of working to gain even the smallest of advantages can be what keeps a business operating or an employee in their job.
In my personal opinion, education as an industry has often seen this subject as irrelevant and even taboo; common arguments including “the government will always support us” and “people need to study, so why worry”. I think the harsh reality in many cases is that these no longer rub. Public money is not banded around with the same enthusiasm that it was, and in some cases education above the very basic of levels has become far more of a privilege for those who can pay than being any kind of human right. This, in turn, is having a huge effect on education as a business, and of course stretches to all those who work in it. Like it or not, I suggest the concept of competitive-advantage is one that education and its employees can no longer ignore. Education is a business like no other, so employees and employers must act accordingly or face the prospect of falling behind those who embrace it. With limited space here, I will focus generally on including the idea of competitive-advantage in education, how to understand it and the initial steps to embracing it.
To start, here is a short theoretical case study to consider. School X provides language classes and teacher training. Three other suppliers in X’s market-place provide exactly the same service offerings in the same locations, at prices which are more or less the same. However, School X is the market leader and has been for three years. One of X’s competitors is close to bankruptcy. Ignoring the factor of pure financial clout, have a quick brainstorm and think of some of the factors which may have led to this outcome?
Some of the answers you may have come up with are: hard-work, strong reputation and brand, quality customer service, well-trained staff and detailed industry knowledge, amongst many others. The key to being competitive lies in understanding what these mean, what your strengths and weaknesses are, and how to arm and use them to succeed.
Moving forward, it is useful to understand some of the underpinnings of competitive- advantage and consider the research done to date which companies and their strategists are using to survive in an increasingly dog-eat-dog world. One of the most prominent theories is the Five Forces Model of Porter (1979 / 2008), who proposed that five factors relating to industry positioning were what mattered: considering strengths and weaknesses and considering threats from competitors, providers and suppliers. Later, this model was challenged by Barney (1995), who proposed that looking at the resources one possessed would load the gun with the silver bullet for success. He argued that possessing the best resources (e.g. facilities, knowledge, staff, innovations and technology) was more important than what existed outside. Both theories are still widely applied today, but a more modern approach was proposed by Teece et al (1997) which attempted to bridge the gap between its predecessors, accounting for both tangible and intangible factors. In short, the theory of ‘dynamic capabilities’ argued that, and excuse any kind of innuendo, advantage stemmed from not only what you had, but how you used it.
I think the last theory is one which can provide educational institutions with the best advice when seeking a way to be competitive in a marketplace where wealth and particularly cash-flow are sometimes scarce and precious commodities. I base this assumption on the fact that some factors of advantage can be built through sheer determination, hard-work and through maintaining quality above all else. Consider, for example, why a new company creating a nice looking computer is not as instantly popular as Apple or Microsoft.
Achieving an Advantage
Now, let us revisit the case study from before and consider it from a different angle. We already know that each company has the same resources, but how is School X organising its resources more effectively to achieve the best advantage?
To explain this, I am fortunate to be working in a company which is competing strongly in a soaring market, full of opportunity. This is not the first time I have been in this position, having held roles in sales, recruitment and management in other industries. In contrast, I have also been in companies finding it tough, and I think it was in the latter where I learnt most of my lessons about what it takes to compete. I decided to draw on both my past and present experience and put my finger on what led to those companies being successful versus their competitors.
Thus, if considering the three models above, certain advantages are built over time and are protected by the high degree of difficulty in emulating them. For example, International House World redesigned the corporate image last year. Interestingly, many know the blue logo incorrectly as the brand; importantly, a brand is much more than an image. The IH brand is essentially actions and emotions which people associate with IH (both internally and externally) including quality, changing worlds, achievement, communication and understanding amongst others. This represents the importance of understanding organisations and individuals as social beings; no different to other social crowds or organisms we are part of. Think for a moment, can you buy the factors which create this brand, or do they come from developing and training over time, or even more, from the core values which we hold as individuals and as a group?
All of the values within the IH brand and culture link directly or indirectly into other parts of daily practice in schools. For example, when someone chooses where to take a CELTA course or study English, in IH or a competitor, what influences them aside from price and location? The brand is one factor, but well-trained staff, high quality customer service and unparalleled industry knowledge are likely to be contributing key factors, all of which make up the IH experience and actually change people’s worlds. These factors are what differentiate IH from others who do things differently.
Meaning in Practice
For me, the sole existence of fundamental values and culture is not enough to ensure competitive advantage – consistently acting on and reinforcing them is what creates this difference, ultimately, any company could draw up a picture about values and display it to customers in reception.
Before I suggest anything more, I want to be clear that I am not saying anything or anyone is doing things incorrectly. Simply, it is my belief that within IH we must strive for excellence by enacting our mission and culture, seeking innovation, making the most of what we have and ultimately by doing things better than the rest. I am sure some are already doing this, but this process is not one-dimensional and short; so opening our minds is arguably a source of advantage.
Teacher training, both formal and informal, is a catalyst for this process. My CELTA focused within the four-walls of the classroom, but the truth is I wish it could have prepared me for the other factors which clients now expect of me. Teachers, as well as other stakeholders like sales and marketing, management and suppliers (all those with a vested interest in an organisation), are seeing more and more demand from clients who expect to gain their own advantage by choosing IH. Thus, while academic development should always be at the forefront of our minds, I agree strongly with Christopher Holloway who wrote in the IH Journal in 2006, that training in customer service is vital. I personally believe that raising every single stakeholder’s awareness of the importance of each client to the future of our organisation will provide the basis for future development. In effect, this is a process of educating human resources (intellectual capital) how to use and show our strengths (tangible and intangible resources) which are our sources of advantage.
These days, as a Director of Studies and of Teacher Training, I have to wear many different hats and I would be the first to acknowledge my role is perhaps unique compared to that of others who share the same title(s). Nonetheless, what I have learnt in my different posts in education is that the importance of business concepts cannot be ignored by any of the stakeholders in the organisation. For instance, parents at schools expect results for their money, and teachers are no longer hidden from clients by their managers; in fact, they are in front of them every day and are those who can arguably make the biggest difference to success or failure. In my current post, I see fostering my team to become more eclectic professionals is what will keep them and us ahead of the pack.
In practice, this means utilising important sources of advantage which are not always obvious or being tapped. To be clear, not for one moment am I suggesting that academic conversations such as those about Dogme and ELF cease to exist. Instead, I am arguing here that such conversations might not exist at all if during times of hardship and success there is not a focus on schools as businesses and a group understanding that bums on seats is what makes the rest possible. I suggest teachers must now be not only academically trained, but also commercially; so my suggestion is not to replace academic topics, but to discuss them in a wider context, much like the application of social sciences in the study of leadership.
To sum up, what does all the above equate to? I think it signifies that we can no longer see the General Director and sales team as those responsible for commercial success, and the academic team as responsible for theirs. Rather, each and every stakeholder must now understand the all encompassing brand and culture, as well as being equipped academically and professionally while having access to better knowledge and resources than the competition (what we possess). To get ahead and stay there, they must be both trained to utilise these resources and more importantly be allowed to use them, supported from above and below (how we use it). This, I hold, is something which should and will become fundamental to our culture and place IH at the forefront of our industry.
Author’s Bio: Tom Scott is currently Director of Studies and Director of Teacher Training at IH Mexico City. Originally a graduate in Chemistry, he achieved Delta 1/2 (writing up Module 3 on management) and is currently half way through his MBA from the University of Liverpool, UK. He has a passion for the social sciences and enjoys giving plenary talks on Distance Learning, Professional Development and other topics.
Barney, J.B. (1995) ‘Looking inside for competitive advantage’, Academy of Management Executive [Online], 9 (4), pp.49-61.
Holloway, C. (2006) ‘Understanding expectations – the client approach to teaching in-company’. IHJournal [Online], 20, 2006.
Porter, M.E. (2008/1979) ‘The five competitive forces that shape strategy’, Harvard Business Review [Online], January, pp.23-41.
Teece, D.J., Pisano, G. & Shuen, A. (1997) ‘Dynamic capabilities and strategic management’, Strategic Management Journal [Online], 18 (7), pp.509-533.