Learning Industry Business Model

Rob Paterson is preparing a presentation discussing the state of food production on PEI. Doesn’t sound of interest to a learning technologies guy, but Rob is looking at systems and business models. Most businesses fail because they don’t have the right business model.

Rob talks about the need to understand the systems at play, and the changing business models in other sectors. I have just finished a project for the NB learning industry, where I was asked to analyse the current industry and make some recommendations about future efforts. There are many parallels in Rob’s post, which I encourage you to read. Rob cites e-Bay as a successful business, along with Southwest Airlines, StarBucks, Dell and Wal*Mart. He states that all of these companies started in small towns, of which New Brunswick has many, and that they have created open systems focused on a community of customers.

How could the NB Learning Industry succesfully use this kind of business model? First, connect with small communities, because we understand their needs. Get away from the idea of making the big sale to a multinational corporation. Sell to other rural communities, because your customer support staff will relate to them. Create a sense of community, through open source software (another success), which is what many small organisations are using already. All of our companies are small, so let’s focus on small markets – lots of them. This doesn’t mean that we sell to small markets so that we can grow and then sell to “real” markets. It means that we stay focused on our core values and strengths, and relate to our markets one conversation at a time. We can become the e-Bay of learning opportunities by creating a real sense of community of small businesses, organisations and countries.

Open Source Learning Business Model

From Scott Leslie; Dokeos is a private Belgian company using the open source Claroline LMS. This company offers training, services and hosting, based on an open source system. I will be interested to see if this business and its model survive. I think that open source in a commercial education venture is not only viable, but that it’s a stronger model. With open source, the vendor can’t hide the system’s weaknesses, but will work with clients to improve the system.

I had previously written about one of my projects last year and discussed this kind of business model.

Oct 2003: I was evaluating LCMS’s for a client and it had been a few years since I’d done this. I saw how much the market had changed. I had conducted some evaluations in 1999 and 2000 for Industry Canada, while I was at Mount Allison University’s Centre for Learning Technologies. The Centre no longer exists, but one of our reports is still available on theTeleEducationNewBrunswick site. We also helped the Centre for Curriculum and Technology Transfer develop the "landonline" LMS evaluation site, which has since become Edutools.

Three years ago there were many choices, or so it seemed. Now the commercial vendors are fewer, and there are even less in the academic market. There are a lot of Open Source systems available, but my clients were uneasy about these, and I understand why. It’s hard to sell your board of directors on technology that has been "cooked-up" by a worldwide network of part-timers. They wanted some kind of insurance.

I believe the next great business model for an elearning entrepreneur is to provide high quality installation and support services for a select group of open source learning systems. Your customers will soon realize that you are not trying to sell them the next upgrade to get more cash, because the software is free. You will be selling your knowledge, experience, and customer service. Many IT departments would be more apt to use open source if they knew that it was strongly supported. Also, there is a lot less conflict of interest when you remove the vendor from the ongoing support.

Having lived through the dot com era, I believe that the marketplace is ready for this new business model.

The Internet and Real-Time Evaluation

Liz Lawley in Many2Many discusses the merits of blogging conference presentations, and describes the different types of presentations, from good speakers & good content to the reverse. The privacy of IRC or other media encourages criticism, and some critical thinking, as well as plain old heckling. I see this as a pretty good method to evaluate conference presenters, either as formative evaluation for improvement or summative evaluation, to ensure that they don’t get invited back if they can’t cut it. Blogging and chat seem to be better evaluation tools than "smiley" sheets that few attendees complete …

This reminds me of Conor Vibert’s competitive intelligence class at Acadia University, where he has students giving presentations on a business, while others are going online to question their claims, and other students are using chat to discuss the points without interrupting the speakers. It’s exciting to watch Conor’s classes in action at the Acadia Real Time Case Competition.

Open Source is a Credible Option for the Big Guys

Even CIO magazine, read by most IT professionals, is coming out in favour of open source, with its recent article on The Myths of Open Source. This is a balanced article, clearly showing that open source does not mean free. Six myths are debunked, such as the idea that there is a lack of support, or that open source is not ready for mission-critical applications. In the end, open source is about standards, like HTML, which are necessary for any kind of collaboration. If you need to collaborate, you probably need open source.

Leadership for the Information Revolution

Peter Levesque, in Democracy & Socioactive Software and Technology [dead link] discusses the effect of the Internet in connecting an unprecedented number of people, who in turn have created a variety of community-based initiatives, such as open source, open content and more flexible copyright rules, like the Creative Commons.

He continues on the Cluetrain thread that markets are conversations, and these conversation must be genuine. This should mean that corporations have to “get real” in order to connect with their markets, as many communities do. But Levesque goes on to say that communities have not been as successful as corporations in producing certain kinds of societal benefits.

Levesque calls for new leadership for the information revolution. “I suggest that the leaders will be found among the aggressively intelligent citizenry, liberated from many tasks and obligations by technology freely shared; using data, information and knowledge acquired from open source databases, produced from the multiples of billions of dollars of public money invested through research councils, universities, social agencies, and public institutions.”

I would suggest that business models that will allow the leadership to prosper will be essential. These potential leaders, from the “aggressively intelligent citizenry”, need to be free from corporate non-disclosures or government gag orders, and the most effective business model could be the free agent working within a peer network. As tenure was essential for academic freedom, so an unfettered business model may be necessary for future leaders. If all individuals had the rights of today’s corporations, what kind of societal benefits would ensue?

Thanks to Stephen’s OLDaily for pointing to this.

Edinburgh Scenarios on eLearning in 2014

I’m posting this information on the Edinburgh scenarios, because I believe it is important, and because I cannot find any more information on the results of the scenario building that took place in Edinburgh last month. Does anyone have any more information? I would like to keep the conversation going.

The eLearninternational 2004 World Summit recently wrapped up in Edinburgh. Prior to the summit, four scenarios were developed by a group of experts, including Jay Cross. These represent a good synthesis of the spectrum of possibilities for 2014. The four scenarios are based on two critical uncertainties, as determined by the working group:

1. Whether the role of technology in society empowers or frustrates; and
2. Whether power, influence and new ideas are primarily from established sources or from new and emergent sources.

The resulting scenarios from the quadrants formed by the intersection of these two axes are:

Web of Confidence: Technology advances, power shifts to emergent players
U Choose: Technology frustrates, power shifts to emergent players
Virtually Vanilla: Technology advances, power retained by established players
Back to the Future: Technology frustrates, power retained by established players

Each scenario describes the main attributes of Learners, Education, Corporations and Government concerning elearning in the future. Both the Web of Confidence and U Choose offer a potentially optimistic future for our own learning industry in New Brunswick, while the other two scenarios are less positive for a small region like ours. In analyzing these scenarios, one can find something plausible in each one. Each scenario will have its proponents and its detractors. There are a number of comments on each scenario online that can be viewed.

edinburgh scenariosThese scenarios offer some common ground for discussion, and we can ask the question: Towards which scenario should we strive? I would suggest that it is the Web of Confidence, with new technologies being used by nimble niche players to foster innovation and learning. On the corporate side, the Web of Confidence would see more flexible, innovative companies offering new forms of learning, while larger corporations struggle to match the ideas produced by start-ups and networked, self-governing groups. If we want the Web of Confidence, with empowered learners and decentralized education, to become reality we should do everything we can to support this vision for 2014.

Another way to look at the possible future is by using Marshall McLuhan’s Laws of Media (McLuhan, M. & McLuhan, E. ,1992, Laws of Media: The New Science. University of Toronto Press.) tetrads on elearning. McLuhan’s laws of media can act as a lens to analyze any medium. The laws of media present a way of analyzing and predicting the effects of a new medium such as elearning.

The laws are presented as a series of questions or probes:

Enhancement. What does the medium enhance, extend, enlarge or intensify?
Obsolescence. What does it make obsolete? When an old medium enters its obsolescence phase, it becomes more ubiquitous, often changing from a utilitarian to a recreational role (e.g. fountain pens).
Reversal. When something is extended beyond the limits of its potential, its characteristics are often reversed. For example, cars which promote greater freedom, when multiplied to the extreme can result in gridlock.
Retrieval. What medium that was previously rendered obsolete does the old medium retrieve from the past? This is usually something from the distant past.

Using these laws we can examine the four components of the Edinburgh scenarios (Learners, Education, Corporations, Government). According to Federman & deKerckhove “the most interesting and revealing exploration comes from the RETRIEVES quadrant“. This is where the money is, in developing potential scenarios.

elearning (Learners)
1.Enhances independence
2.Obsolesces sitting in a classroom
3.Reverses into information overload, isolation
4.Retrieves diaries (web logs)

elearning (Education)
1.Enhances its reach.
2.Obsolesces teacher as “sage on the stage”
3.Reverses into commodification of learning
4.Retrieves community involvement (parents involved via elearning from home or office)

elearning (Corporations)
1.Enhances just-in-time training
2.Obsolesces just-in-case training
3.Reverses into over-prescription and overload
4.Retrieves sense of community (virtual communities of practice)

elearning (Government)
1.Enhances learning for all
2.Obsolesces physical infrastructure
3.Reverses into “one size fits all”
4.Retrieves the “town hall” (individual access to government)

This is only one exercise, and is limited in its insights, as the tetrads should be used, re-used, refined, questioned, and further refined before drawing any conclusions. McLuhan would always recommend deeper probing. But what can this initial probe tell us? First, we could say that individual freedoms are retrieved by elearning. This shows that one of the strengths of elearning is in fostering individual freedom to learn. One result of this retrieval could be more fragmented markets, composed of many individuals. In turn, this could create more room for multiple niche offerings. This form of retrieval supports the case for the Web of Confidence scenario.

At the same time, there is the potential for the reversal effects of elearning shown above. The reversal effects could result in the bleaker scenarios of Virtually Vanilla or Back to the Future. Much of this future is ours to shape, but by seeing the potential effects of our decisions today, we can make the right decisions for the long term.

RSS & e-Bay

A follow-up on e-Bay and how the customer community is making the process of buying & selling online easier. How do you compete with a business model where customers help each other to use a web service? In this case, it’s an RSS feed to keep track of items for sale in your news aggregator. I don’t use e-Bay but I sure like their business model. From Seb.

Knowledge Work

Lilia has written an excellent paper on knowledge work and weblogs. The main uses she cites for blogging (personal knowledge repositories, learning journals, or networking instruments) are the same reasons that I blog. I find that writing about things that I find interesting or useful online helps me to create my own knowledge repository. With Drupal as a CMS, my repository is also searchable, so I can search my own blog to find something that I posted about open source a few months back. This is the main reason that I amalgamated my other blogs; so I could find stuff. The discipline of writing every day is a form of a learning journal, and is similar to what Stephen Covey calls "sharpening the saw". The more you write, the more skilled you become; I hope 😉

Another point in Lilia’s paper is that knowledge work is "discretionary behavior", in that knowledge workers have to be motivated to do knowledge work. Many companies are tryng to find ways to motivate their knowledge workers. This makes me wonder about Peter Drucker’s comment that the corporation as we know it won’t be around in the next 25 years (Managing in the Next Society, 2002). Perhaps the actual structure of work, especially the Corporation itself, is an obstacle to knowledge work. Instead of tweaking the mechanisms of the corporation, through job redesign or cultural initiatives, we should be re-examining the basic structure of the corporation. It is an industrial age creation, designed to maximize physical capital and may not be optimal for maximizing "knowledge capital".

The network, with its dynamic conversations, is where a lot of knowledge work gets done, and we should be looking at new laws to recognise networks in a similar way that we recognise corporations as legal entities. Is anything like this happening?

Conversations on e-Bay

One of the first things that Meg Whitman remarked about e-Bay was that ‘It looks like the experience people have with each other helps define your brand.’. The Monitor has an in-depth article on the current CEO of e-Bay, showing how peer-to-peer relationships and a small service fee are some of the keys to the success of this multi-billion dollar company. One more example that there are others on the Cluetrain, who are successful.