http://dx.doi.org/10.30585/jrems.v1i4.341 © 2019 the Authors. Production and hosting by Avicenna FZ LLC. on behalf of Dubai Business School, University of Dubai, UAE. This is an open-access article under the CC BY 4.0 license (https://creativecommons.org/licenses/by/4.0/). Page | 33 Journal of Research in Emerging Markets JREM, 2019, Vol. 1, No. 4, ISSN: 2663-905X Available online at http://publications.ud.ac.ae/index.php/jrems The difficult act of balancing financial and academic performance: Product adaptation strategies at university branch campuses Ali Bhayani a a Faculty of Business, University of Wollongong Dubai, United Arab Emirates, alibhayani@uowdubai.ac.ae. Received: 24 June 2019, revised: 9 November 2019, accepted: 25 November 2019, published: 8 December 2019. ABSTRACT Adapting a product to suit local requirements is a well-known international marketing strategy. Branch campuses generally adapt programs to suit local requirements. However, the academic fraternity has resisted adaptation on concerns about the dilution of academic standards. This study uses data from five branch campuses to examine the link between adaptation and financial and academic performance. The results indicate that adaption leads to increased financial performance but does not maintain academic standards. The study recommends strategies to maintain a balance between an ethnocentric approach, which calls for similar academic standards, and a geocentric approach, which requires adaptation. Keywords: Higher education, internationalization, product adaptation, branch campuses, academic standards JEL codes: D11, D21, D40, D83, F23, I23, M31 1. INTRODUCTION Universities are looking to internationalize to target worldwide segments with their program offerings (Bhayani, 2015; Nelson Oly Ndubisi, Naidoo, & Wu, 2014). In order to maintain academic standards, higher education (HE) as a product, needs to be standardized in offshore markets, where regulation is limited (Lieven & Martin, 2006). On the other hand, Kerr (1990) argues that due to divergence in educational systems across the world, universities are expected to adapt their products in accordance with the host countries. The adaptation debate overlooked the fact that universities cannot be compared to commercial firms. This is because, a commercial firm’s focal point is the consumer and it is run by senior management, whose objectives are to generate an economic surplus (Sugden, 2004) and to function like multinational corporations (Marginson, 2013). Furthermore, commercial offshore locations, in order to achieve economic efficiency and augment revenues, usually offer adapted and many times sub-standard products that satisfy the consumer (Bhayani, 2014; Nixon, Scullion, & Hearn, 2016). Existing research regarding adaptation has generated inconclusive results with regard to economic efficiency (Tan & Sousa, 2013). Moreover, research discussing product adaptation primarily deals with products marketed by multinational corporations. These studies might not be able to encapsulate intricacies associated with higher education services because it is not as simple as satisfying the consumer, the students, and generation of economic surplus (Naidoo, Sankar, & Ekant, 2011). Universities considering internationalization need to solve the product adaptation dilemma so they can predict the consequences of their strategy on financial and academic performance. Studies that have explored HE product adaptation (Hsuan-Fu & Chia-Chi, 2008), have overlooked the impact of product adaptation on financial performance. This study would breach this gap by providing exploratory research with regards to assessing the international marketing strategies of the universities. Another motivation for this study is to overcome the obsession of scholars to emphasize on proof-driven research that ignores the context of the study (Redding, 2005). Although there has been an increase in a number of studies that have stated that the context is not only complex and dynamic but also multi-dimensional (Michailova, 2011; Piekkari, Welch, & Paavilainen, 2008; Poulis, Poulis, & Plakoyiannaki, 2013; Sminia, 2015). Therefore, this study aims to breach this gap in the literature by studying international product strategies in a specific context and developing an understanding-driven model. HE in International Business (IB) literature is