Founder of Apollo Group

John Sperling founded the Apollo Group after realizing the need to transform the country's established higher education system. His main goal was to meet the educational demands of working adults who wanted to enroll in classes but were unable to do so due to their busy schedules at traditional institutions and colleges. Adults between the ages of 23 and 39 make up the school's student body. At the undergraduate and graduate levels, it offers both campus-based and online learning programs. Late in 2007, the Apollo Group and the Carlyle Group formed Apollo Global to make significant investments in the international education sector. Apollo Global currently operates educational institutions in the United Kingdom, China, the Netherlands, Chile, India, and Mexico. This is in addition to the numerous institutions established in the United States.

The Apollo Group is the parent organization of the University of Phoenix that operates as a profit education institution which is contrary to the traditional educational institutions. The Wall Street Journal ranked Apollo Group among the top 50 organizations after its stock rose from an IPO of $0.76 to $98 in the mid-2005. The group has been able to record increases in revenue from $2 billion in 2006 to $5 billion during the 2008-2009 recession period.

The group has grown from a student population of 25,600 to over 550,000 in 2011. This is attributable to the online learning program that allows working adults to enroll and complete their education programs at their convenience. Unlike other traditional universities and colleges, the University of Phoenix employs 33,000 tenured professionals in all its faculties to provide online and offline academic guidance to students, 5% of which are full-time members (Robinson, 2012). The strategic objectives of the Apollo group focus on improving the student well-being thus contributing to its continued success since its inception.

The Apollo Group

The Apollo Group operates as a multi-business learning institution that ought to meet the needs of the online as well as the campus-based students. This group operates under the proprietary (for profit) college and university sector in the United States that has attracted a lot of government scrutiny on its performance. This sector is growing over time with most institutions struggling to get accreditation to include degree programs as part of their curriculum. Therefore, it is important for the Apollo Group to conduct its operations and ensure it has a competitive edge in the industry.

Alternative Solutions

The management has to make a decision on three portfolio strategies to ensure it competes competitively in this industry that has attracted numerous players. It has to review whether it will use a low-cost, speed-based, or differentiation strategy. The success of these strategies depends on whether the Apollo Group wants to operate on a narrow or wide competitive scope. Differentiation strategy is the ability of an organization to offer the customers something different from competitor offerings (Miltenburg, 2005). It requires the firm to have a broad market focus and offer superior products that create value for the customers. When marketing these products, the business has to emphasize these differentiating features to build on its brand image and reputation.

Low-cost is a cost leadership strategy to reduce the costs of a product in comparison to competitors. The firm always targets a broad market and offers high quality products to its customers. The success of this strategy is possible if the business cuts down on its costs in each of its sector (Miltenburg, 2005). Lastly, the speed-based strategy is how fast an organization responds to technological or market changes, and customer demands. It provides a company with competitive advantages in the present-day competitive global business world. This strategy is short-term as the market, technology and consumers wants change rapidly. It is suitable if the company focuses on a narrow market as it may lead to significant losses once it is outdated.

Selected Solution to the Problem

The Apollo Group should adopt a low-cost strategy in its operations. The company spends significant amounts on selling and promotional activities. Its budget relies heavily on the student program funding which is not a good financing option as these funding is subject to strict monitoring by the government. As the group is expanding its educational institutions to a global market, it is important for the firm to review its fee structure to meet the financial needs of the target market.

Implementation

To implement this strategy, the Apollo Group has to find cost-effective methods of marketing its educational services to the students. It could use their website to advertise for enrolment and to give accurate information concerning the operations of the university. It could rely on its current students to market the online education programs to other potential students. The company should find alternative means of generating revenue instead of relying on the Title IV program funding.

Recommendations

The differentiation strategy is an alternative competitive strategy to the low-cost strategy that Apollo Group. The strategic goals of the Apollo group are unique and prioritize the students before the employees. It should deliver additional benefits to the students besides allowing them to pursue online programs at their convenience. The guidance Apollo Group offers its students before enrolling for a program is helpful in ensuring they pursue programs that suit them. This education institution should find a means of reducing the cohort default rate among its students to eliminate the chances of discontinued programs.

Conclusion

The Apollo Group is a giant in the online-education market as an analysis of the number of students at the University of Phoenix earned their degrees through online learning. The increasing use of technology in every sector of the economy has contributed to its rapid growth. The Apollo Group should follow a low-cost strategy then a differentiation strategy to achieve a competitive advantage in the market.



References

Miltenburg, J. (2005). Principles of Competitive Strategy. In Manufacturing Strategy: How to Formulate and Implement a Winning Plan 2nd Edition (pp. 9-26). New York City: CRC Press.

Robinson, R. (2012). The Apollo Group, Inc.





Appendix

Appendix I: SWOT Analysis

Strengths

Keeps touch with the employers of their students.

Fee is 60% of what a typical private college charges.

Uses plain-vanilla technology during global expansion.

No costs on student unions, sports teams and societies.

Opportunities

Globalization of education.

Shortcomings in the quality of higher education offerings.

Insufficient public funding to meet demand for education

Weaknesses

High selling and promotional expenses.

Low quality of education in natural sciences,

Threats

Increase in the cohort default rate.

Technology and research and development

Quality of education.

Most classes are offered in leased spaces countrywide.