1. Changing Trends on Overseas
Tertiary Education Choices
Prepared for: 2nd International Entrepreneur & Family
Business Association World Conference 2009 / UIBL 2009
Prepared by: Spire Research & Consulting
Date: 30 October 2009
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 1

2. Trends on Overseas Higher Education for Indonesian
Fact & Figures
SIZING UP THE POTENTIALS
Each year, more than 4 million new Indonesian students pursue tertiary education program
About 0.75% of total or 30,000 students elect for overseas education program
A large market of estimated USD 450 million each year for the tuition fee spending
More than 90% of the students obtain their education fund from their parents
OUTSIDE ASIA LOCATION: THE TARGET NARROWING
To prepare for the succession, the children of successful family-owned businesses owners
are often sent to overseas for their secondary and tertiary education
The potential self-funded international student segment for oversea education outside Asia
narrows to children of family with their own business or the upper-class family
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 2

3. Trends on Overseas Higher Education for Indonesian
The Changing Trends
HIGHER OVERSEAS EDUCATION COST IN LOCAL CURRENCY
The overseas education cost has increased with higher exchange rate of foreign currencies
against the Asian local currencies since 1997
The affordability for overseas tertiary education to children of the rich families was reduced
and limited especially for Indonesia and Malaysia.
…THE CHOICE OF LOCATION EVOLVES
The trend in the choices of university and country selection within ASEAN is changed
Singapore, Malaysia, Australia and New Zealand universities gaining higher popularity:
Closer distance proximity
More affordable living and education budget
The previously popular countries like the United States,
Canada and UK are becoming less popular
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 3

4. Trends on Overseas Higher Education for Indonesian
Location Choice: United States of America (USA)
HIGH-LIVING COST & POPULAR STATES STILL POPULAR ……
Indonesia is ranked 16th in top countries sending students to US, with 7,629 student intakes
from Indonesia, in 2007-2008.
The total intakes declined from over 10,000 students each year before 1997
Major high-living cost states in California, New York, Massachusetts and Washington
States are the popular destination
One the top six universities for Indonesian students studying in USA is University of Southern
California (USC) in Los Angeles, is a popular choice for the children of the rich, family-
owned business owners since the 1990’s.
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 4

5. Trends on Overseas Higher Education for Indonesian
Location Choice: United Kingdom (UK)
SMALLER INTAKES, BUT IMPORTANT TO UK HIGHER LEARNING INSTITUTIONS………….
Among overseas students studying in UK:
Malaysian: ranked 5th
Indonesian: ranked 6th
Total number of Indonesian students studying in UK is less than 1,000 students
The average tuition fee of £9,000 as of 2007-2008 (in 1999-2000: only £6,550) becomes
affordable to the rich-family children for self-funding students.
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 5

6. Trends on Overseas Higher Education for Indonesian
Location Choice: Australia
A POPULAR LOCATION CHOICE TO BOTH INDONESIAN AND MALAYSIAN STUDENTS…..
There were 21,000 Malaysian and16,000 Indonesian students enrolled in Australian
universities in 2008
Malaysia is on the 5th most of all international students studying in Australia
Both Indonesian and Malaysian students combined contribute AU$500 millions of tuition fee,
with average tuition fee of AU$13,500 per year.
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 6

7. Trends on Overseas Higher Education for Indonesian
Location Choice: Singapore
MOST POPULAR OVERSEAS EDUCATION LOCATIONS FOR
INDONESIAN AND MALAYSIAN STUDENTS……
The total number of international students increased from 50,000
students in 2001 to almost 100,000 students in 2008
Indonesian and Malaysian students are the top in the
ranking:
Similar Asian culture
Close proximity to Indonesia & Malaysia
Indonesian family-owned businesses owners having their own
residential property investment in Singapore
New Singapore universities, like Singapore Management
University (SMU), taking more international students
The success of long-established universities and institutions
in taking Indonesian and Malaysian students:
Nanyang Technology University
National University of Singapore
Singapore Institute of Management
LaSalle International Design School
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 7

8. Trends on Overseas Higher Education for Indonesian (cont’d)
Location Choice: Singapore
Upon completion of the bachelor program, they will:
Return to Indonesia to run the family business
Continue their further post-graduate education in Australia
Continue to live in Singapore and take senior position in their
Singapore regional headquarters.
Some successful large Indonesian companies that was
previously a family-owned business growing to become
international companies and set up their regional head quarter
in Singapore
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 8

9. Executive Post-Graduate Market
MBA Program Gaining Popularity Among Top Executives
SHORT-PROGRAM OR DISTANCE-LEARNING MBA PROGAM FOR TOP EXECUTIVES……
Some top executives running the family-owned businesses require further post-
graduate study
Programs are typically from world’s top universities with high tuition fees
Likely to elect for short-program or distance-learning Executive MBA program
Only required to take class-room based teaching or lectures for a short-period of time only,
6 to 18 month programs
Affordability and frequent travel expenses, even once or twice in a month
Singapore benefits from its close distance to Indonesia.
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 9

10. Key Industry Trends in Overseas Education
Aggressive Marketing, Twinning Program, Reach Out New Target
Aggressive & increase marketing effort to attract international students in Asia
Organize seminars in hotels or directly at elite high schools
Appoint and work with education service agents
Local campuses, twinning programs
Open a new local campus in the high-promising countries
Establish linkage with local universities as campus in the targeted countries for twinning
program “3+0”, 2+2”, “2+1”
Reach out new different potential student segment
Children of upper-class families that looking for lower-cost option yet still obtaining degrees
from international universities in US, UK or Australia
Most of the study years are in local country without attracting high expenses of living
abroad
Tuition fee typically range from US$10,000 to 20,000 for the whole program of 3 or 4 years of
study to completion.
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 10

11. Relating Overseas Education, Family Business & Entrepreneurs
The Emergence of New Young Entrepreneurs (1)
Emergence of New Young Entrepreneurs
During their time in universities, start to build their make friendship with same country of
origin and similar family background, the rich families that own businesses.
From school friendship network later turns out to be a powerful business network system,
when returning home
New businesses are often started with their network
Shortly in a few years after their return to their home country
Among students studying together in overseas, the most common sectors for new business
ventures are:
Retail
Fashion
Food franchises
Entertainment
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 11

12. Relating Overseas Education, Family Business & Entrepreneurs
The Emergence of New Young Entrepreneurs (2)
Key reasons for selection of new business:
Easier to set up
No difficulty in raising the initial investment capital
Have a high-profile for social acknowledgement and recognition
Lesser constraint of business expansion capital
Some of the businesses become successful and grow into a sizable business
relatively faster in 2 to 3 years
Successful young entrepreneurs and top executives reunite back with old school
friends and strengthen social and business network by joining young entrepreneurs
groups and clubs.
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 12

13. Relating Overseas Education, Family Business & Entrepreneurs
The Emergence of New Young Entrepreneurs (2)
Dynamic, Gradual Characteritic Changes to Family Business & Conglomerates
In Indonesia, successful conglomerates & family business only started in the 1980s &
1990s:
Now run by the 2nd or even 3rd family generation of the founders and owners
The sons and daughters are immediately posted in top position and senior managements of
the company
Top executives obtained academic qualification from overseas education system
Bringing new management concepts learnt from the school
Gradually change the management system from a single-authority management to
team-based or committee-based senior management decision
The senior management team are formed with academically-qualified and
professional managers, some are their ex-school friends.
Ex-school friends are trusted due to the long-established relation built since the student days
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 13

14. Tel: (65) 6838 5355
Fax: (65) 6838 5855
78 Shenton Way #20-01
Singapore 079120
sg.info@spireresearch.com
www.spireresearch.com
Prepared for: UIBL / IEFBA 2nd Conference 2009 Date: 30 October 2009 Page 14