Discourse on dynamic capabilitites of privately run higher education institutions in Latvia

Abstract

There are no any indicators, showing that the Higher Education Institution’s (HEI) market in Latvia can grow. The demographic decline, economic uncertainty and high unemployment rate allow predicting the exit from the market the weakest HEIs. The aim of the paper is to identify strategies that privately run HEI might pursuit in current high-velocity environment sustaining competitive advantages. Authors have applied the dynamic capabilities framework as a theoretical foundation and propounded four research questions. Having investigated the stage of Latvian privately run HEI industry consolidation, authors have answered the first research question: what should be the cornerstone of a HEI long term strategic plan in current industry consolidation stage? Then authors conducted the survey of students’ opinions among different privately-run Latvian HEIs and answered second research question: what educational philosophies have been adopted by many privately run HEIs: customer or product oriented approach towards students? Next, the research paper identifies the necessity of product oriented approach and determined dynamic capabilities for such strategic move. Finally, authors answered on the forth research question: is it possible to develop and sustain the competitive advantage, developing international strategies by exploiting a HEI’s resource and capabilities? Despite the limitations the paper has potential to generate a scholar’s discussions and might lead to further research. Methodological, theoretical and practical implications are discussed.