010503LN(M)ZXF575GKAT-P1 Driving pro-active growth at the IBO United World College meeting 23 June 2003

010503LN(M)ZXF575GKAT-P1

Driving pro-active growth at the IBO

United World College meeting23 June 2003

2

The first iteration of a strategic plan to be presented to the Council of Foundation in November 2003 should address the following themes:

– planned growth in order to maximise the impact of the IBO mission

– the prioritisation of work using an ‘impact function’

– the development of additional delivery models that will enable the IBO to fulfill its mission in a wider range of circumstances

– the use of fundraising as an essential tool to achieving impact in places that would otherwise be financially unable to work with us

– a plan to ensure that the PYP and MYP become self-financing

3

Agenda

Measured by the standards of our mission, in force during the past decade, the IBO has done very well.

We now can – and must – decide how we want to develop in the mid to long term:

– How should we prioritise our growth opportunities?

– What delivery models do we need to meet our clients’ needs?

– Do we need to fund our growth?

– How do we make the MYP and PYP self-sustaining?

Summary: the IBO in the period of influence – a paradigm shift

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The IBO mission

The International Baccalaureate Organization aims to develop inquiring, knowledgeable and caring young people who help to create a better and more peaceful world through intercultural understanding and respect.

To this end the IBO works with schools, governments and international organizations to develop challenging programmes of international education and rigorous assessment.

These programmes encourage students across the world to become active, compassionate and lifelong learners who understand that other people, with their differences, can also be right.

5

Number of students receiving an IB education*

*Calculated by the average of students of schools in the PYP**Diploma students is the sum of Diploma and Certificate students in first and second year of study***CAGR – Compound Average Growth Rate (average year-on-year growth)

Source: Internal data; McKinsey analysis

1997–2002E, 000 PYPMYPDiploma**

0

40

80

120

160

200

1997 1998 1999 2000 2001 2002E

CAGR***

PYP: 50% p.a. (2000)

MYP: 26% p.a.

DP: 10 % p.a.

+18.8%

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New students, 1997–2002E*

No. of students receiving an IB education

*Diploma only, 54% growth in NA from Diploma and 46% from CertificateSource: Internal data; McKinsey analysis

5,131

15,544

3,440

48,227

78,757

2,634 2,045 1,140 596

1997 NA public school

Europe NA privateschool

Asia Pacific

LatinAmerica

Middle East

Africa 2002E

North America and Europe

represent 80% of growth

12.0 8.5 13.8 9.6 5.0 17.8 7.8 10.3Relative growth, %

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IBO presence in the world

Depth

Developed

Public System

PrivateSystem

Breadth InternationalRich in poorand

developing

PrivatePublic

“Rigour and independent marking makes IB a popular choice for ambitious pupils at top schools”

Economist, 25 Jan 03

“There is a definite trend towards the IB. It (IB) has the advantage of being widely recognised… but it is significantly more challenging and is thus not for everyone”

International Herald Tribune, 25 Jan 03

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Agenda








9

IBO in 2010E*

% of total number of students

*Assuming historic growth patterns. Diploma only

Depth

Developed world

Developed

Public System103k

PrivateSystem36k

59%(from 55% actual)

20%

80%

From . . .

“One IB school in every country”

. . . to?

“We have the responsibility to widen access to IBO’s programme, rejecting its restrictions to an economic elite”

Strategic intent

Breadth

100% = 175k

International 8k 4% (from 9% actual)Rich in poorand

developing

Private 26k 15%Public 1%

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Impact definition

IBO presence in the region Special relations with schools, gov’t, etc. Segment’s readiness and attitude towards

IBO Sustainability of specific initiative

Impact = ƒ(Educational , ease of implementation, size of potential student pool)

Assessed as a function of improvement in the educational experience and relevant utility of programme for the individual student. Three levels could be considered: National education School level Individual level

No. of students it reaches in each segment (e.g country, in public and private schools)

Country purchasing power

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Discernable groupings of potential IBO target segments

Universe of K-12 education

Band 4 Rest of K-12 universe: purely international school reach or no reach at all

Characteristics IB solidly present in private and public schools Strong networks with schools and authorities Strong sub-regional organisation

Band 1 Where IB programmes are already well established


Band 2Where the IBO has the strongest potential to grow its impact2a. Traditionalists2b Pioneer models

Characteristics First public school reached or within reach Good relations with educational authorities Recognition of IB values in local

educational context

Band 3 Where the IBO has low presence with no signs of reaching critical mass

Characteristics Low, purely private presence beyond int’l

schools No key relationships in sight Lacking infrastructure or desire to fully use

IB programmes

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Segment strategies


Band 4 As a rule of thumb, do not engage

STRATEGYLet development happen at natural paceSupport local/sub-regional IB initiativesPull back from extensive direct school support

BAND 1 Where IB programmes are already well establishedE.g., U.S. (FL), Australia, International Schools


BAND 2Where the IBO has the strongest potential to grow its impact2a. Egypt, Russia, US (LA), Singapore2b. Germany, Lithuania, Texas (PYP)

STRATEGYBuild actively in 2a with IBO world schools, in 2b with customised models

Set proactive targetsPromote the creation of local networksTarget-specific projects

BAND 3 Where the IBO has low presence with no signs of reaching critical massEx. Portugal, Ghana, Vietnam

STRATEGYDo not pursue unless special circumstances signal potential to reach critical mass

Put more responsibility on counterpart before investing energy

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Weak Strong

Stand alone study

All stand-alone consultancy exercises

– Lectures

– Private organisations

– Advisory board

* Clear end

IBO enabled

IBO transfers its expertise on curriculum, assessment and development activities; but does not monitor the quality of the outcome

IBO brand not used

IBO endorsed

The IBO act as a provider and monitors programme quality

IBO provides the curriculum and supports assessment and teacher development

IBO’s secondary brand

IBO world schools

IBO has tight control on the whole education process: curriculum, assessment, teacher development

IBO brand name in use

IBO consulting Team formed by pulling the best knowledge within the IBO Clear scope, time frame and objectives ‘Per diem’ rate

IBO control, branding,

responsibilityMore consultative More transactional

PRELIMINARY

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IBO consulting evolution

Impact

Time

Formation

Structuring

Maturity

Establish a formal consultancy structure without full-time team (use resources available today)

Establish a ‘per diem’

Establish a full-time consulting team

Start building ‘knowledge’ database

Clear set of product offerings

Significant ‘knowledge’ database

Professional structure bringing together the best of IB for every client

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17

IBO financial results

$000,000

Source: Finance department 1997-2002; McKinsey analysis

Surplus/deficit

Expenses

Revenues

-0.8

26.7

34.8

0.91.32.70.2

-0.1

29.0

24.022.2

19.2

15.4

33.9

18.415.3

22.4

30.3

1997 1998 1999 2000 2001 2002

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1.5

22.3

52.3

22.8

Share comparison*

%

* Diploma onlySource: UNESCO–EFA report; Finance department; McKinsey analysis

‘potential student pool’, 2000 IBO student distribution, 2002E

47.3

16.5

6.7

31.3

Developing public

Developing private

(0.2)Poor

Developedprivate

Developedpublic

Developing public (1.5)

Developing private

Poor (0.9)

Developedprivate

Developedpublic

100% = 99m 100% = 78,000

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Potential fundraising targets

$

*Assuming return on capital of 6%/year, an endowment of this size would provide funds for described activity for infinity

Objective Endowments* Goal Total

Support one Diploma student in a full functioning school in the developing world for the whole duration of the course (2 years)

16,500 1,000 students 16.5million

Sponsor 75% of the authorisation and maintenance (IB-related costs only) of 1 MYP/PYP school in the developing world

143,500 5 schools(one network)

717,500

Sponsor 75% of the authorisation and maintenance (IB related costs only) of a medium sized school for the Diploma in the developing world. No student included

186,500 5 schools 932,500

ILLUSTRATIVE

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Agenda








21

Programme contribution to surplus**

$000,000

-0.5

0.9

1.8

-0.3

DP Surplus

MYP deficit

PYP deficit

Consolidatedsurplus

*Based on 2002 P&L (Deloitte&Touche revised, May 2003)

**Contributions rounded

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23

The development of the IBO . . .

Voluntary work and passion were the main drivers of success

Several financial crises and mostly informal business processes

A renowned and well regarded international curriculum is built

Niche player (“The heroic years”)

Significant penetration gained in the developed world

Professional management processes introduced

Incipient work with international organisations (e.g., National Education Organisation, UN, etc.)

Developed world player(“The professional years”)

1968 90s 21st centuryTime

ImpactGlobal player(“The period of influence”)

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We have begun a paradigm shift

Passive reaction to others’ initiative Active development of target segments

From ‘The Professional Years’… To ‘The Period of Influence’

IBO centric Networked/delegated One full-service model–IBO world schools

4 models–IBO world schools, enabled, endorsed, consulting

Quality ensured by complete IBO control

Quality ensured by accreditation

IBO staff as creators and executors:–Assessment: Cardiff-centered

–Prof dev’t: Regional offices–Authorisation & reviews: in-house

IBO staff as enablers and trainers:–Assessment: scalable models (regionalisation/accreditation of ext. assmt centers)–Prof dev’t: external partnerships for workshop delivery–Authorisation & reviews by networks of trusted ‘IB experts’ Straight fee Funded fees from endowments

Blocks of funds raised sporadically from few donors

Systematic development of fundraising portfolio across donor types

Active alumni organisation No continued contact with students

25

The first iteration of a strategic plan to be presented to the Council of Foundation in November 2003 should address the following themes:

– planned growth in order to maximise the impact of the IBO mission

– the prioritisation of work using an ‘impact function’

– the development of additional delivery models that will enable the IBO to fulfill its mission in a wider range of circumstances

– the use of fundraising as an essential tool to achieving impact in places that would otherwise be financially unable to work with us

– a plan to ensure that the PYP and MYP become self-financing

26

ENDThank you for listening

Documents

010503LN(M)ZXF575GKAT-P1 Driving pro-active growth at the IBO United World College meeting 23 June 2003