Strategic Groups and the Competitive Dynamics of Higher Education in Chile

Abstract

To study the competitive dynamics of higher education in Chile based on the theory on strategic groups. Methodology / approach: Exploratory factor analysis is applied to determine the strategic dimensions. Afterwards, a k-means cluster analysis is applied to group the universities. Finally, Pearson’s correlation analysis is applied to study the performance of strategic groups. The competitive dynamics of universities is determined by the variables of reputation, infrastructure, social responsibility, distance learning, scope and publicity; universities are also classified in nine strategic groups based on the strategic positioning on each of its dimensions. Also, strategic decisions adopted by universities are consistent with their performance indicators. It is possible to access higher levels of statistical validity as higher levels of information are available, that all universities are considered, and that the temporal consistency of strategic groups is analyzed. With the theory of strategic groups, public managers can implement public policies that are in line with the market structure and competitive dynamics of universities. On the other hand, university managers can know their strategic positioning, who are their direct competitors, and the impact of strategic dimensions on performance indicators.The results of the study supports the theory of strategic groups and the need to study the structure and competitive dynamics of higher education sectors.