Establishment of Golden Coast

Tech
Nous Group interactive case study

Bold ideas | Engaging people | Influential, enduring solutions

Nous Group interactive case study

Establishment of Golden Coast Tech |

This page is intentionally blank.

Nous Group

nousgroup.com.au

| i |

Nous Group interactive case study

Establishment of Golden Coast Tech |

Contents
1

Introduction ....................................................................................................................................... 3

Case study .......................................................................................................................................... 4

2.1

Background ............................................................................................................................. 4

2.2

Question 1 ............................................................................................................................... 5
2.2.1

2.3

Question 2 ............................................................................................................................... 7
2.3.1

2.4

Answer to question 4............................................................................................... 12

Question 5 ............................................................................................................................. 13
2.6.1

2.7

Answer to question 3............................................................................................... 10

Question 4 ............................................................................................................................. 11
2.5.1

2.6

Answer to question 2................................................................................................. 8

Question 3 ............................................................................................................................... 9
2.4.1

2.5

Answer to question 1................................................................................................. 6

Answer to question 5............................................................................................... 13

Question 6 ............................................................................................................................. 14
2.7.1

nousgroup.com.au

Answer to question 6............................................................................................... 16

| ii |

Nous Group interactive case study

Establishment of Golden Coast Tech |

1 Introduction
Thank you for taking the time to work through this practice case study. It provides an example of the
work we do at Nous Group (Nous) and the foundational skills we expect from our consultants. It also
offers an example of the type of question you may be asked at a candidate interview, though it is likely
to be briefer in an actual interview. Just like a real interview case, information outside of that provided is
not required.
As with a real interview case, you should be less concerned with getting the right answer in a precise
sense, and more focused on how you approach the problem. The solutions we offer are just one
possibility. Importantly, they provide a structured approach to thinking about the problem.
Feel free to provide any feedback at careers@nousgroup.com.au if you think we could make this case
even more useful for you and others.
Thank you,
People Team

nousgroup.com.au

| 3 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2 Case study
2.1 Background
USEQ is looking to capture growth
The University of South East Queensland (USEQ), a traditional research-based university, is looking to open
a subsidiary university. The proposal is in response to changing conditions in student demand for bachelorlevel qualifications. Over the past few years, USEQ has observed growing demand in the region for:

bachelor degrees in particular areas of regional skills shortages

bachelor degrees based on a more practical rather than theoretical pedagogy

bachelor degrees that include work placements during study and a fast track to employment.

The subsidiary university, to be known as Golden Coast Tech, would focus on meeting these new sources
of student demand, most likely in a way that would complement USEQs current and preferred
strategy of focusing on students with an Australian Tertiary Admission Rank (ATAR) greater than 70.* If
established, Golden Coast Tech would also operate in the south east Queensland region, at a site already
owned by USEQ.
USEQ has engaged Nous Group (Nous) to determine the high-level feasibility of establishing Golden
Coast Tech as a subsidiary university. USEQ requires a report for its governing body, which is meeting in
three weeks.

* A students ATAR measures how they fared in their Year 12 studies relative to their peers in each state.
For example, an ATAR of 90 implies a student was in the top 10% of their year; an ATAR of 80 implies the
student was in the top 20%; and so on.

nousgroup.com.au

| 4 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.2 Question 1
To determine the high-level feasibility of Golden Coast Tech a number of pieces of analysis will be
required. A Nous Principal has asked you to think about the areas of analysis we should primarily focus
on considering the short timeline for the projects delivery.
a. Of the following modules of analysis, what should be the core focus over the three-week
engagement? Select 3 to 5 to focus on.
Attractiveness of the tertiary education market
Competitive environment
Legal and regulatory environment for new tertiary education institutions
Scenario analysis
Business relationship between Golden Coast Tech and USEQ
Analysis of overseas models of tertiary education
Management skills of USEQ executives
Value chain analysis
Golden Coast Techs potential students
Student satisfaction with USEQ
b. Of the 3-5 modules you have selected above, list 2-4 more specific areas of focus (i.e. sub-questions)
that you think the team should focus on.

nousgroup.com.au

| 5 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.2.1 Answer to question 1

Suggested modules and most critical areas in each to focus on
1a

1b

(i) Attractiveness of the

tertiary education
market
Specific areas to consider:

(ii) Golden Coast Techs

potential students

Specific areas to consider:

Market size

ATAR band

Forecast market growth,

including likely trends in
tertiary education

Type of qualifications of
interest

Market profitability
(revenue and expenses)
Financial barriers to
entry, i.e. start-up costs
Likelihood of relevant
federal and state
government policy
changes

Desired delivery styles

and learning methods
(e.g. classroom, on-line,
work place)
Willingness to travel to
access preferred tertiary
education
course/institution

(iv) Business relationship

between Golden Coast
(iii) Competitive environment
Tech and USEQ
Specific areas to consider:

Threat of substitutes, i.e.

other higher education
providers

Market share

Market fragmentation,
i.e. possibility for market
share to be eroded over
time

Specific areas to consider:

How should Golden Tech

be branded?

Should Golden Coast Tech

compete with USEQ, with
similar course offerings?

Should Golden Coast Tech

be a feeder for USEQ,
i.e. preliminary courses
that provide a basis for
further university study?

Is there a possibility for

USEQ to redefine its own
strategy to further
complement Golden
Coast Tech?

(v) Legal and regulatory

environment for new
tertiary education
institutions
Specific areas to consider:

Legal relationship with

USEQ, i.e. part of USEQ or
completely separate?

Time and cost to obtain

initial regulatory approval

On-going legal and

regulatory requirements

The areas identified aim to broadly determine feasibility:

A. Is there sufficient demand?
B. Can we compete?
C. Can we implement?

nousgroup.com.au

| 6 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.3 Question 2
The following questions will explore the first three modules. Lets begin by reviewing the attractiveness
of the market.
The Nous project team has examined federal government data on undergraduate enrolments to gain a
macro picture of domestic demand for tertiary education (see Exhibit 1 below). All students who gain a
place in a bachelor degree are selected on the basis of their ATAR, except those listed below as nonATAR entries (e.g. mature age students).
Exhibit 1: New undergraduate enrolments in Australian universities
Students (000s)
grouped by ATAR
band

CAGR
(NB: Total = 8%)

160
140
120
100

80
60

2.4
2.1
8.2

1.9
1.7
7.2

17.6

16.0

3.0
2.5
9.5
19.4

3.7
3.0
10.9
21.3

4.7
3.6

12.5

6.3
4.7

27%

15.7

17%

28.2

23.5

24.4

25.4

26.4

26.9

27.7

28.5

26.1

25.4

6%
Non-ATAR
entries
50 or below

32.2

40

12%

23.5

30.1

22.6

22%

5%

50.05-60.00
60.05-70.00
70.05-80.00

20

28.8

28.3

29.4

30.0

30.6

34.2

4%

80.05-90.00
90.05 or more

0
2007

2008

2009

2010

2011

2012

CAGR refers to the compound annual growth rate, i.e. the rate of growth if this growth were at a steady
rate.
What are the key insights from this chart?

nousgroup.com.au

| 7 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.3.1 Answer to question 2

The market for tertiary education is dominated by those with ATARs of over 70, even if lower ATAR
cohorts are increasingly enrolling in undergraduate degrees in Australian universities.
Student enrolments have grown moderately each year, except in 2012 where growth was more
significant.
Fastest growth is in cohorts with lower ATARs and non-ATAR entries, with year-on-year growth in the
cohorts of students with ATARs of 70.05 and above lower than the overall CAGR of 8%.
Notwithstanding the CAGR of 8% over the period is potentially misleading, noting that growth from 2011
to 2012 was much higher than earlier. An important question to consider is whether this is a once-off
trend (possibly due to a population anomaly) or is indicative of future growth in tertiary education.
Based on the trajectory of previous enrolments, there would appear good prospects for continued
growth, particularly in students with lower ATARs.

nousgroup.com.au

| 8 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.4 Question 3
Lets now review the potential for Golden Coast Tech to focus on a particular segment of the market for
students in south east Queensland.
The Nous team prepared Exhibit 2 to better understand the opportunity for students in the region, again
with a focus on ATARs.
In conducting this analysis the team was reminded by the client of USEQs strong preference to remain a
traditional research-based university with a focus on students with ATARs above 70. This may provide a
market opportunity for Golden Coast Tech to focus on students with lower ATARs, to occupy a
complementary market position.
Exhibit 2: Undergraduate enrolments in south east Queensland universities (2012)

Students 100%
grouped by
90%
ATAR band
80%
70%

6%

56%

7%

1% 1%
12%
16% 15%
17%
26% 23%
24% 27%
7%

3%

3%

3%

4%

2%

45%

60%

50.05 70.00

50%
87%
79% 82% 84%
74%
69% 70% 71%

40%
30%
20%

50.00 or less

38%

48%

70.05 or
more

10%

Engineering

Science

Architecture

Agriculture

Health

Humanities

Creative Arts

Education

Business

Info. Tech.

0%

What are the key insights from this chart? What does this mean for Golden Coast Techs opportunity
considering USEQs preferred strategy?

nousgroup.com.au

| 9 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.4.1 Answer to question 3

Undergraduate enrolments are generally dominated by students with ATARs of 70+, but there is some
variance amongst degrees.
Information technology and business degrees comprise a comparatively larger share of students with
ATARs below 70. Accordingly, there is a captive market in Information Technology and Business for
Golden Coast Tech due to the large number of students seeking one of these degrees if USEQ focuses
less on those students with ATARs less than 70. The size of this captive market depends on the extent to
which USEQ has market share of south east Queensland universities in these areas.
Another (counter) inference might be drawn: there is a captive market for those courses at the right end
of the chart because students who would like to study courses in these areas (e.g. science and
engineering) are not currently able to do so in south east Queensland. However, this chart makes no
indication of the size of this potential grouping. Moreover, there may be other reasons why students
with lower ATARs are not typically enrolled in these courses, e.g. typical difficulty of such courses. For
these reasons, the former inference is preferred.

nousgroup.com.au

| 10 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.5 Question 4
Lets continue with the second module of analysis to gain a more detailed view of the type of student
in terms of their academic standing that Golden Coast Tech might focus on.
The Nous team is aware that an educational researcher, Professor John Kimble, has just finished a study
looking at completion rates at Australian universities based on a students ATAR (see Exhibit 3). In his
sample, he looked at degrees that are:
1. Vocationally focussed, e.g. applied business, applied information technology
2. Theoretically focussed, e.g. traditional humanities, science, engineering
Exhibit 3: Undergraduate completion rates at Queensland universities grouped by ATAR (2008-2011)

79%
67%
55%

63%
53%

64%
56%

77%

77%
77%

67%
Theoretical
focus

44%

90.05 or more

80.05-90.00

70.05-80.00

60.05-70.00

50.05-60.00

Vocational
focus

50 or below

90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

What are the key insights from this chart? What does this mean for Golden Coast Tech?

nousgroup.com.au

| 11 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.5.1 Answer to question 4

There would appear a consistent correlation between a students ATAR and their likelihood of
completing an undergraduate degree.
For students with an ATAR above 70, the likelihood of completion does not vary between vocationally
focused or theoretically focused degrees.
For those with an ATAR less than 70, completion rates are much higher for those studying degrees with a
vocational focus.

nousgroup.com.au

| 12 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.6 Question 5
USEQ Vice-Chancellor wants a mid-project update.
Nous Principal on the project has asked you to update the Vice-Chancellor on the teams analysis and
findings to date. The principal asks you to complete a short PowerPoint slide pack (3-5 slides) for the
Vice-Chancellor with a summary of our findings so far.
What major points (3-4) would you include in the PowerPoint slide pack, including an overall
headline?

2.6.1 Answer to question 5

A major opportunity exists for Golden Coast Tech to capture the high-growth demand for vocational
Bachelors degrees by low-ATAR students, particularly in Information Technology.

There was solid growth in the enrolments for bachelor-level degrees, with CAGR of 8% from
2007 to 2012 (with a noticeable spike from 2011 to 2012).

There was very strong growth in enrolments for students with ATARs less than 70 and those
without an ATAR (though from a low base).

In nearly all fields of study most students have ATARs of more than 70. In Information
Technology and Business the majority of students have ATARs less than 70.

Students with ATARs less than 70 are more likely to complete their degree if it is vocationallyfocused.

nousgroup.com.au

| 13 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.7 Question 6
Following the briefing from the Nous project team, USEQ asked Nous to undertake a preliminary
assessment of the feasibility of establishing a degree in information technology to ascertain approximate
students numbers and therefore potential revenue. The selection of a degree in information technology
was supported by anecdotal evidence from local employers of a skill shortage in this area.
Now focusing on the third module of analysis, the Nous team and the client agreed this degree could be
particularly successful if it:

targeted students with ATARs of less than 70 or applicants without ATARs

is vocationally-focused in terms of its teaching and delivery

has a limited intake of 50 students each year to ensure maximum support for each student such
that extraordinarily high completion rates are possible.

USEQ has provided some internal analysis about forecast student applications for information
technology degrees in the region (see Exhibit 4). This is based on trend data collected by USEQ.
Exhibit 4: Applicants for information technology degrees in Golden Coast Techs regional area

Number of
applications

1200
1000
800

75

77

80

210

216

223

82

84

229

236

273

281

Non-ATAR entry
50.00 or below

600
250

258

265

400
200

50.05 - 70.00
70.05 or more

350

361

371

382

394

0
2014 2015 2016 2017 2018
USEQ also believes that an information technology degree offered by Golden Coast Tech could 'capture
a percentage of this available market. Again, based on collected trend data, USEQ has provided likely
capture rates, where the capture rate refers to the market share of potential applicants that Golden
Coast Tech could expect from the forecast number of applicants for information technology degrees in
the region. See Exhibit 5 for these capture rates.

nousgroup.com.au

| 14 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

Exhibit 5: Anticipated capture rates by ATAR band

Student cohort

Forecast market share or capture rate for Golden Coast

Tech

Non-ATAR entry

10%

50.00 or below

10%

50.05 - 70.00

5%

70.05 or more

1%

Based on the data provided in Exhibit 4 and Exhibit 5, how many students could Golden Coast Tech
expect to be teaching in information technology each year between 2014 and 2018 (inclusive)? Round
the number of students (broken down by 1st year, 2nd year and 3rd year) to the nearest integer.
NB: The proposed degree would be for three years of study, and USEQ has requested that Nous
assume a 100% completion rate of the degree to provide a maximum possible figure.

nousgroup.com.au

| 15 |

Nous Group interactive case study

Establishment of Golden Coast Tech |

2.7.1 Answer to question 6

Student enrolments were forecast by applying the capture rate to each cohort. Each cohort was then
summed to provide annual enrolments. For example, year 1 intake in 2014 was calculated as follows:
(10% of 75) + (10% of 210) + (5% of 250) + (1% of 350) = 44.5 (rounded to 45). This intake continues in
year 2 and year 3.
100% completion rates were assumed, meaning that all students enrolled in 2014 proceeded to 2nd
year in 2015 and 3rd year in 2017.
For reference, the maximum intake of 50 would be reached in 2018.
Exhibit 6: Forecast enrolments at Golden Coast Tech for an information technology degree

Forecast student 160

enrolments
140
120

45

46

47

100

3rd year students

80
45

60

46

47

49

2nd year students

1st year students

40
20

45

46

47

49

50

2014

2015

2016

2017

2018

nousgroup.com.au

| 16 |