Dieter Holtz Wedde
President and Director General
Laureate International Universities México
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View from the Top

Employability and Productivity Catalyst for Human Talent

Tue, 09/01/2015 - 10:53

Q: What are the key elements that make Laureate the largest education provider in the world?

A: Laureate is growing very aggressively based on the philosophy of employability, which is the most important component of our educational strategy. While Laureate does not invest heavily in finding new patterns and developing new and sophisticated formulas or machinery through complicated research, we offer a network of teaching universities that focus on creating employability for our students. This approach is what has made us so successful within the middle classes of the countries in which we operate.

Worldwide, we have around 1 million students that are distributed across 80 universities in around 29 countries. Our current growth is geared toward countries in which we do not yet have a presence, which is most of Asia. In Latin America, we are already more consolidated, allowing us to take advantage of a sophisticated network of universities and use economies of scale for the benefit of the students. This also gives us a competitive advantage in terms of content and the network of professors. In Mexico, we have been particularly successful in delivering employability to our graduates through a formula of very specific academic content and educational models for the middle class. Our courses have been very popular with individuals that come from families with no university degrees in their history. This is a completely different academic approach to the known, traditional, elite universities. Our commitment to Mexico lies within its growing middle class, to which we deliver an international quality education at accessible prices. No other Mexican educational institution can match our large network of universities. We can provide online content and platforms, visiting professors, seminars, and many other benefits because of our global scale. Given that we have 200,000 students in this country, we are, by far, the largest private education institution in Mexico. By taking on the responsibility of educating the middle classes, which are the people who will boost the country’s productivity, we aim to push Mexico’s growth at a faster rate.

Q: Which educational institutes is Laureate using to deliver these solutions to students in Mexico?

A: The two institutions that enable us to achieve this are Universidad del Valle de México (UVM), and Universidad Tecnológica de México (UNITEC). UVM has around 125,000 students, and UNITEC has around 75,000. UVM has a model that expanded geographically into 22 states, while UNITEC is just beginning that process and is more focused on the metropolitan area of Mexico City. The UVM model is focused on international content and opening up the doors of our international network to our students, while UNITEC is focused on people that need to study efficiently, quickly, and flexibly. UVM provides a university experience with extra-curricular activities, such as sports, cultural activities, networking, and campus life, while UNITEC is more direct in its approach to studying because 75% of our people at this university are also working part-time. UVM’s ratio of work and study students is more like 30-35%. Clearly, these are two very different institutions, but together they cover a wider spectrum of the middle class in Mexico. The difference in tuition fees between both institutions is around 40-50%.

Q: What are the most significant ways in which Laureate serves the automotive industry in Mexico in terms of human talent?

A: With thousands of engineers graduating from our institutions every year, we are one of the most important suppliers of human resources to the automotive industry. We have found that there is a critical area of opportunity due to the lack of technical talent in the Mexican automotive industry. There is an inefficiency in the way that engineers are hired, which is something that we discovered during intense conversations with FCA, Nissan, KIA, Audi, Volkswagen, and GM. These companies take about eight to 12 months to train engineers, which results in a one year gap of productivity across the entire country. Only around 4% of people working in the industry have graduated from some sort of higher education with a technical degree. The average found by the Organization for Economic Co-operation and Development (OECD) is 30%. This shows that the country has not been doing things correctly. Another example is Chile, where every year 65% of students within higher education are studying technical careers, while the remaining 35% focus on university degrees. In Mexico, 95% go to university and 5% go into technical education. When entering the automotive sector, most candidates need to have technical capabilities, which is something that Mexico has neglected. There is not yet a system in place to change this, but we have made an effort to work with the automotive sector in order to understand its needs. Approximately 71% of the automotive companies operating in Mexico cannot find people with the education they require. However, they still hire these people but then have to focus on training them for 12 months. Additionally, 59% of the employees in the automotive industry did not get above the level of middle school.

Having worked with all the main companies in the industry, and now working with auto parts companies, we are seeing the same trend across the board. There is a requirement for graduates to have a specific technical competency, but the system is not delivering. In response, we have enlisted the help of ten universities in our network that are focused on technical higher education. Together, we have been providing the best content and teachers to develop technical programs in the automotive sector. By sitting down with some large OEMs in Mexico, such as Ford and Nissan, we were able to show them the content that we defined from our global benchmarking, in order to develop these technical programs. This has proved to be a substantial endeavor because Mexico has a negative opinion of technical education. We have found that a well-prepared technician can earn the same salary as somebody who graduates from university as an engineer or even more. Today, Laureate is working toward bringing the entire industry into this program, and toward being able to offer the students a certificate of recognition, because we are partners of the automotive industry. OEMs are happy to share their best practices with us so that we may consolidate them into an academic model, in order to bring more, much needed talent to the sector.